Albuquerque, N.M.-based Horizon Healthcare Corp. reported a net loss of $2 million, or 6 cents per share, for the fourth quarter ended May 31, compared with net income of $5.8 million, or 25 cents per share, in the year-ago quarter. Revenues from continuing operations grew 43% to $161.2 million. For the fiscal year, the Nashville, Tenn.-based chain reported a 25% increase in net income to $20.8 million, or 77 cents per share, from $16.6 million, or 91 cents per share, for fiscal 1994. Revenues from continuing operations grew 63% to $565.7 million. Net earnings included a loss from discontinued operations of $12.7 million for the fourth quarter and $16.9 million for the fiscal year, resulting from the company's June announcement that it will divest eight of its facilities. The company merged with Continental Medical Systems on July 10 and is now known as Horizon/CMS Healthcare Corp. It operates 37 acute rehabilitation hospitals and 125 long-term-care centers totaling 18,972 beds.
Integrated Health Services reported a 98% rise in net income for the second quarter ended June 30 to $13.4 million, or 52 cents per share, from $6.8 million, or 40 cents per share, in the year-ago quarter. Revenues leaped 99% to $278.4 million. IHS attributed the growth to its expansion of post-acute-care systems, which include subacute care, inpatient and outpatient rehabilitation, pharmacies, home healthcare and diagnostic services. For the six months, Owings Mills, Md.-based IHS reported a 105% increase in net income to $27.1 million, or $1.05 per share, from $13.2 million, or 78 cents per share, in the year-ago period. Revenues grew 100% to $543.8 million. IHS provides post-acute healthcare services in 30 states.
Physicians Health Services recorded a 20% increase in earnings in the second quarter ended June 30. The Trumbull, Conn.-based managed-care company said net income increased to $3.7 million, or 39 cents per share, from $3 million, or 33 cents per share, in the year-ago quarter. Revenues rose 10% to $80.1 million. For the six months, the company reported a 20% rise in net income, to $6.8 million, or 72 cents per share, from $5.7 million, or 61 cents per share, in the year-ago period. Revenues grew 11% to $158.3 million. Enrollment for the quarter rose to 103,133, an 18.9% increase from the year-ago period. PHS stock is traded over the counter.
Physicians in Pennsylvania can buy shares in a new HMO owned and run by doctors. Pennsylvania Physician Healthcare Plan hopes to raise $16.5 million for its statewide HMO, although its offering has the potential to raise $165 million. A prospectus has been mailed to 30,000 practicing physicians, offering 25,000 shares of Class A common stock at $5,000 and 40,000 shares of Class B common stock at $1,000. The HMO intends to hire business professionals to run it, while its board of directors will be controlled by physicians.
A third of the nation's life and health insurers are financially vulnerable, according to a new rating system by Standard & Poor's Corp. The New York-based rating agency switched to a "quantitative" rating system for measuring the financial strength of some 810 life and health insurers that don't pay the agency for a credit assessment. The quantitative ratings are derived solely from an analysis of financial statements filed with state regulators. Standard & Poor's adopted the scale so that those ratings would be directly comparable with the ratings of claims-paying ability provided for some 250 life and health insurance companies that pay for that service. The ratings of claims-paying ability also take into account discussions with management and confidential information. Of the 1,066 life and health insurers rated by Standard & Poor's, 67% are rated BBB or higher, while 33% have speculative ratings of BB or lower.
Craig McKnight was named executive vice president and chief financial officer of Charter Medical Corp., the nation's largest chain of psychiatric hospitals. Effective Oct. 1, McKnight will replace Lawrence W. Drinkard, who had been with Atlanta-based Charter since 1979. Drinkard said he was stepping down to spend more time with his family. McKnight previously was a partner with Coopers & Lybrand.