28.04.04

28.4.2004: Meldung: Oxford Health First Quarter 2004 Results

Oxford Health Plans Reports First Quarter 2004 Results
Monday April 26, 4:44 pm ET

* Earnings per share of $1.03 for the quarter

* Parent cash and investments total $433.5 million
TRUMBULL, Conn., April 26 -- Oxford Health Plans, Inc. (NYSE: OHP - News) announced today net earnings of $86.7 million, or $1.03 per diluted share, for the quarter ended March 31, 2004, compared to $72.9 million, or $0.86 per diluted share, for the prior year quarter. The prior year results include a pretax charge of $45 million, or $0.32 per share after tax, for the settlement of the 1997 securities class action litigation. See Exhibit 1 of this release for a reconciliation of net earnings reported under generally accepted accounting principles to run rate earnings for the first quarter of 2004 compared to 2003.
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"We are pleased with these financial results, as they continue to demonstrate the success of our overall strategy. Our customers value our broad portfolio of products, as well as the scope and quality of our provider network and service we provide," commented Charles G. Berg, President and CEO of Oxford.
Business Highlights
Membership: Total fully insured commercial membership ended the quarter at 1.40 million members compared to 1.43 million members at the end of December 2003. The decline in fully insured commercial membership during the quarter was in line with management"s estimates. Medicare membership was 70,400 at the end of the quarter.
Premium Revenue: Premium revenue increased 5.6% in the first quarter to $1.38 billion from $1.31 billion in the first quarter of 2003. Commercial premiums increased 5.4% to $1.22 billion from $1.16 billion in the first quarter of 2003. During the first quarter of 2004 commercial premium yields increased approximately 9.9% over the prior year quarter. Commercial member months declined 4.1% for the quarter compared to the 2003 period. Medicare premiums were $167.1 million in the first quarter of 2004, compared to $155.4 million in the first quarter of 2003.
Investment and Other Income, net: Investment and other income, net, was $24.1 million in the first quarter of 2004, compared to $31.6 million in the first quarter of 2003. Realized gains for the quarter were $4.9 million in 2004, compared to $13.7 million in 2003. The net pre-tax yield on the Company"s investment portfolio was approximately 3.0% for the first quarter of 2004, compared to approximately 3.6% in the first quarter of 2003.
Health Care Services Expense: Health care services expense was $1.118 billion in the first quarter of 2004, compared to $1.034 billion in the first quarter of 2003. The first quarter of 2004 includes approximately $0.5 million of net favorable medical reserve estimate changes from prior periods compared to approximately $7.1 million in the first quarter of 2003. Commercial per member per month (PMPM) medical costs for the first quarter of 2004 increased approximately 11.8% compared to the 2003 first quarter. This increase reflects the reported PMPM commercial medical costs adjusted for net favorable development of commercial medical reserves of approximately $3.3 million and $8.0 million in the first quarter of 2004 and 2003, respectively, and the impact of one additional business day in the first quarter of 2004. Adjusting for the additional business day, commercial PMPM medical costs increased by approximately 10.7%. This increase was in line with management"s estimates for the quarter and is consistent with management"s estimate of a full year commercial PMPM medical trend between 9% and 10%.
The previously reported first quarter 2003 commercial PMPM medical costs increased only 8.4% over the first quarter of 2002, creating an atypical point of comparison for the current quarter"s results. The 2003 first quarter PMPM commercial medical cost increase was lower than expected at that time as a result of several one-time events affecting utilization in that quarter. The remaining three quarters of 2003 had higher medical cost trends and represent more normalized run rates for year-over-year analysis. Full year 2003 PMPM commercial medical cost trends were approximately 9.4%.
Marketing, General and Administrative (MG&A) Expenses: MG&A expenses were $147.3 million, resulting in an administrative loss ratio of 10.6% for the first quarter of 2004, compared to $142.3 million and a 10.8% administrative loss ratio in the first quarter of 2003. As a result of business mix changes and higher premium tax rates, broker commissions and premium taxes accounted for $50.8 million, or 34.5%, of total MG&A expenses for the first quarter of 2004, compared to $45.7 million, or 32.1%, of MG&A expenses in the first quarter of 2003. Excluding the increases in broker commissions and premium taxes, remaining MG&A expenses were essentially flat compared to the first quarter of 2003. (All dollar amounts and percentages cited in this paragraph for 2003 exclude the litigation charge for settlement presented in the accompanying income statement.)
Medical Costs Payable: Medical costs payable were $692.9 million as of March 31, 2004 compared to $671.5 million as of December 31, 2003. The $21.4 million increase during the quarter was primarily due to an increase in IBNR and unpaid claims reserves of $21.1 million. Days claims in medical costs payable ended the quarter at approximately 58 days, consistent with the level at December 31, 2003.
Cash Flow: Cash flow from operations was $65.1 million in the first quarter of 2004, compared to $114.1 million in the first quarter of 2003. Cash flow from operations for the first quarter of 2004 and 2003 includes only two months of Medicare premium receipts. Proforma for the January Medicare premiums received in December of each prior year, operating cash flows would have been $54.2 million and $50.2 million higher in 2004 and 2003, respectively. The decrease in operating cash flow from the prior year quarter was primarily due to the timing of income tax payments, increases in medical costs payments and the funding of certain accrued expenses. Net income for the first quarter of 2003 included a $45 million non-cash charge for litigation settlement.
Parent Cash Balances: Parent company cash and investments totaled $433.5 million at March 31, 2004, compared to $369 million at December 31, 2003. The increase during the quarter was primarily due to dividend receipts from regulated subsidiaries, income tax transfers from subsidiaries in excess of amounts due to taxing authorities and proceeds from stock option exercises. The Company currently has a $50 million dividend request under review by New York regulators.
Share Repurchase Program: As a result of the proposed merger between the Company and a wholly owned subsidiary of UnitedHealth Group, the Board of Directors of Oxford has terminated the Company"s share repurchase program. The Company did not repurchase any shares in the first quarter of 2004. The Company repurchased 23.8 million shares for $757.2 million since the inception of its share repurchase program in the third quarter of 2001.
Quarterly Dividend: The Company will pay a quarterly cash dividend of 10 cents per share on April 27, 2004 totaling $8.2 million, to shareholders of record as of April 12, 2004. The Company does not anticipate declaring any additional quarterly dividends at this time due to the proposed merger.
Conference Call and Webcast
The Company will hold a conference call today at 6:00 p.m. (Eastern Time) to review the results of the first quarter and to discuss management"s outlook for the balance of 2004. This call replaces the previously scheduled call on Thursday, April 29, 2004. The public is invited to listen to this conference call by dialing 1-888-452-0455 (using the passcode 3580340) at least 10 minutes prior to the start of the call. Individuals who dial in will be asked to identify themselves and their affiliations. Investors, analysts and the public are also invited to listen to the conference call over the Internet by visiting our website at www.oxfordhealth.com. To listen to this call live on the Internet, visit the investor page of Oxford"s web site at least 20 minutes early (to download and install any necessary audio software).
About Oxford
Founded in 1984, Oxford Health Plans, Inc. provides health plans to employers and individuals primarily in New York, New Jersey and Connecticut, through its direct sales force, independent insurance agents and brokers. Oxford"s commercial insured products and services include traditional health maintenance organizations, preferred and exclusive provider organizations, point-of-service plans and consumer directed health plans. The Company also offers Medicare plans and third party administration of employer-funded benefits plans. More information about Oxford Health Plans, Inc. is available at www.oxfordhealth.com.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release, including statements concerning the Company"s strategy, product portfolio, provider networks and other statements contained herein regarding matters that are not historical facts, are forward-looking statements as defined in the Securities Exchange Act of 1934; and because such statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward- looking statements. Factors that could cause actual results to differ materially include, but are not limited to:
* Changes in federal or state regulation relating to health care and
health benefit plans.
* The state of the economy.
* Rising medical costs or higher utilization of medical services,
including higher out-of-network utilization under point-of-service plans
and new drugs and technologies.
* Competitive pressure on the pricing of the Company"s products, including
acceptance of premium rate increases by the Company"s commercial groups.
* Higher than expected administrative costs in operating the Company"s
business and the cost and impact on service of changing technologies.
* The ability of the Company to maintain risk transfer, risk sharing,
incentive and other provider arrangements and the resolution of existing
and future disputes over the reconciliations and performance under such
arrangements.
* Any changes in the Company"s estimates of its medical costs and expected
cost trends.
* The impact of future developments in various litigation matters and the
periodic examination, investigation and review of the Company by various
federal and state authorities.
* The Company"s ability to renew existing members and attract new members.
* The Company"s ability to develop processes and systems to support its
operations and any future growth and to administer new health care
benefit designs.
* Any future acts or threats of terrorism or war.
* Those factors included in the discussion under the caption "Cautionary
Statement Regarding Forward-Looking Statements" in Part I, Item 1, of
the Company"s Annual Report on Form 10-K for the fiscal year ended
December 31, 2003 filed with the Securities and Exchange Commission.


OXFORD HEALTH PLANS, INC.
Consolidated Income Statements
For the Three Months Ended March 31, 2004 and 2003
(In thousands, except per share, per member per month
and membership highlights data)

Unaudited
Three Months Ended
March 31,
2004 2003
Revenues:
Premiums earned $1,384,248 $1,310,460
Third-party administration, net 2,888 3,117
Investment and other income, net 24,109 31,555
Total revenues 1,411,245 1,345,132

Expenses:
Health care services 1,118,457 1,034,109
Marketing, general and
administrative 147,275 142,250
Litigation charge for settlement - 45,000
Interest and other financing charges 4,594 2,228
Total expenses 1,270,326 1,223,587

Earnings before income taxes 140,919 121,545
Income tax expense 54,254 48,620
Net earnings $ 86,665 $ 72,925

Net earnings per common share - basic $ 1.07 $0.87

Net earnings per common share - diluted $1.03 $0.86

Dividends per common share $ 0.10 $ -

Weighted-average common shares - basic 81,365 83,762
Dilutive effect of stock options 3,166 1,470
Weighted-average common shares - diluted 84,531 85,232

Selected Information
Medical loss ratio 80.8% 78.9%
Administrative loss ratio,
excluding net litigation charge 10.6% 10.8%
Earnings before income taxes,
financing charges, depreciation
and amortization ("EBITDA") $ 152,407 $ 129,570
PMPM premium revenue $312.18 $283.99
PMPM medical expense $252.24 $224.10
Fully insured member months 4,434.1 4,614.5

As of March 31,
Membership Highlights 2004 2003
POS, PPO and Other Plans 1,216,600 1,276,800
HMO 187,500 204,000
Total Fully Insured Commercial 1,404,100 1,480,800
Medicare 70,400 70,700
Third-party Administration 37,100 41,100
Total Membership 1,511,600 1,592,600


OXFORD HEALTH PLANS, INC.
Consolidated Balance Sheets
As of March 31, 2004 and December 31, 2003
(In thousands, except share data)

Assets
Unaudited
March 31, December 31,
2004 2003
Current assets:
Cash and cash equivalents $ 617,168 $ 536,510
Investments - available-for-sale,
at market value 1,383,185 1,370,535
Premiums receivable, net 38,200 30,505
Other receivables 30,966 30,082
Prepaid expenses and other current
assets 15,209 16,785
Deferred income taxes 36,329 45,240
Total current assets 2,121,057 2,029,657

Property and equipment, net 37,422 31,638
Deferred income taxes 9,390 9,572
Restricted cash and
investments-held-to-maturity,
at amortized cost 59,554 59,738
Goodwill and other intangible
assets, net 21,161 21,785
Other noncurrent assets 6,394 7,811
Total assets $2,254,978 $2,160,201

Liabilities and Shareholders" Equity

Current liabilities:
Medical costs payable $ 692,915 $ 671,515
Current portion of long term debt 4,000 4,000
Trade accounts payable and accrued
expenses 146,861 138,925
Unearned revenue 144,971 187,751
Income taxes payable 45,340 30,530
Current portion of capital lease
obligations 4,811 5,749
Total current liabilities 1,038,898 1,038,470

Obligations under capital lease - 467
Long-term debt 393,000 394,000

Shareholders" equity:
Preferred stock, $.01 par value,
authorized 2,000,000 shares - -
Common stock, $.01 par value,
authorized 400,000,000 shares;
issued 106,847,681 shares in 2004
and 106,612,822 shares in 2003 1,068 1,066
Additional paid-in capital 776,408 750,919
Retained earnings 859,369 780,856
Accumulated other comprehensive
income 18,655 10,622
Unearned restricted stock unit
compensation (16,221) -
Treasury stock, at cost (816,199) (816,199)
Total shareholders" equity 823,080 727,264

Total liabilities and
shareholders" equity $2,254,978 $2,160,201


OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the Three Months Ended March 31, 2004 and 2003
(In thousands)

Unaudited
Three Months Ended
March 31,
2004 2003

Cash flows from operating activities:
Net income $ 86,665 $ 72,925
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation and amortization 7,256 6,070
Noncash income (4,146) (4,146)
Litigation and other noncash charges 274 45,000
Deferred income taxes 5,300 (11,240)
Realized gain on sale of investments (4,854) (13,723)
Changes in assets and liabilities:
Premiums receivable (7,695) (7,736)
Other receivables (884) 808
Prepaid expenses and other
current assets 1,576 (5,520)
Medical costs payable 21,400 56,353
Trade accounts payable and
accrued expenses (15,994) (23,131)
Income taxes payable 14,810 43,290
Unearned revenue (38,634) (45,229)
Other, net (7) 427
Net cash provided by
operating activities 65,067 114,148

Cash flows from investing activities:
Capital expenditures (10,640) (3,588)
Purchases of investments (394,401) (462,412)
Sales and maturities of investments 423,404 457,677
Net cash provided (used) by
investing activities 18,363 (8,323)

Cash flows from financing activities:
Proceeds from exercise of stock options 7,760 7,659
Payments under capital leases (1,405) (1,344)
Redemption of notes payable (1,000) (7,656)
Cash dividends paid (8,127) -
Purchase of treasury shares - (24,237)
Net cash used by financing
activities (2,772) (25,578)

Net increase in cash and cash equivalents 80,658 80,247
Cash and cash equivalents at beginning
of period 536,510 321,627
Cash and cash equivalents at end of
period $617,168 $401,874



Exhibit 1

OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
Supplemental Schedule Reconciling GAAP Earnings to Run Rate Earnings
For the Three Months Ended March 31, 2004 and 2003
(In thousands, except per share data)
(Unaudited)
Three Months Ended
March 31,
2004 2003

Diluted earnings per common share - GAAP $ 1.03 $ 0.86

Effect of run rate adjustments:
Litigation charge for settlement - 0.32
Changes in estimates of prior
period medical cost reserves (0.01) (0.05)
Diluted earnings per common share - Run Rate $1.02 $ 1.13

Diluted common shares 84,531 85,232

Three Months Ended
March 31,
2004 2003

Net earnings - GAAP $86,665 $72,925

Effect of run rate adjustments:
Litigation charge for settlement - 27,000
Changes in estimates of prior
period medical cost reserves (307) (4,235)
Net earnings - Run Rate $86,358 $95,690


Note: Exhibit 1 above reconciles the differences between run rate
earnings and net earnings calculated and presented in accordance with
generally accepted accounting principles ("GAAP"). Management believes
that the presentation of run rate earnings provides useful information to
investors regarding the Company"s results of operations because such
presentation facilitates the period-to-period comparison of operating
performance by eliminating charges for settlement of the 1997 securities
class action litigation, which charges are unrelated to current period
operating performance, and by eliminating, among other things, the
current period impact of changes to the Company"s estimates of prior
period medical cost reserves.

Run Rate Adjustments for the Quarters Ended March 31, 2004 and 2003

During the first quarter of 2004, the Company had net favorable prior
period reserve adjustments ("PPRAs") of medical costs of approximately
$0.5 million, compared to approximately $7.1 million in the first quarter
of 2003. These PPRAs had a nominal $0.01 per share effect on reported
net earnings for the first quarter of 2004 and increased first quarter
2003 earnings by $0.05 per share.



Exhibit 2

OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
Changes in Medical Costs Payable
For the Three Months Ended March 31, 2004 and 2003
(In millions)
(Unaudited)

Amounts Relating to
Three Months Ended March 31, 2004 Claims Incurred During
Total 2004 2003 and Prior

Balance as of December 31, 2003 $ 671.5 $ - $ 671.5

Components of health care services
expense:
Estimated costs incurred 1,119.0 1,119.0 -
Estimate changes (0.5) - (0.5)
Health care services expense 1,118.5 1,119.0 (0.5)

Payments for health care services (1,097.1) (536.3) (560.8)

Balance as of March 31, 2004 $ 692.9 $ 582.7 $ 110.2


Three Months Ended March 31, 2003 Amounts Relating to
Claims Incurred During
Total 2003 2002 and Prior

Balance as of December 31, 2002 $ 618.6 $ - $ 618.6

Components of health care services
expense:
Estimated costs incurred 1,041.2 1,041.2 -
Estimate changes (7.1) - (7.1)
Health care services expense 1,034.1 1,041.2 (7.1)

Payments for health care services (977.8) (506.3) (471.5)

Balance as of March 31, 2003 $ 674.9 $ 534.9 $ 140.0


Changes in Medical Costs Payable

During the first quarter of 2004, the Company incurred estimated health
care services expenses of $1.12 billion compared to $1.04 billion in the
first quarter of 2003, representing an increase of $78 million, or 7.5%.
During the first quarter of 2004, net favorable PPRAs were $0.5 million
compared to $7.1 million in 2003. The 2004 amounts were comprised of
favorable development of $3.3 million on commercial reserves and
unfavorable development of $2.8 million on Medicare reserves. The 2003
amounts were comprised of favorable development of $8.0 million on
commercial reserves and unfavorable development of $0.9 million on
Medicare reserves.


Exhibit 3

OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
COMPONENTS OF MEDICAL COSTS PAYABLE
As of March 31, 2004 and 2003 and December 31, 2003
(In millions)
(Unaudited)

Amounts Relating to
Claims Incurred During
As of March 31, 2004 Total 2004 2003 and Prior

IBNR and medical claims reserves $ 662.6 $ 551.5 $ 111.1
Pharmacy PBM payable 27.1 27.1 -
Stabilization and stop-loss pools,
BDCC and GME reserves, net 2.6 4.1 (1.5)
Other reserves 0.6 - 0.6
Medical Costs Payable Balance $ 692.9 $ 582.7 $ 110.2

Amounts Relating to
Claims Incurred During
As of March 31, 2003 Total 2003 2002 and Prior

IBNR and medical claims reserves $ 609.7 $ 505.2 $ 104.5
Pharmacy PBM payable 25.5 25.5 -
Stabilization and stop-loss pools,
BDCC and GME reserves, net 19.3 4.2 15.1
Other reserves 20.4 - 20.4
Medical Costs Payable Balance $ 674.9 $ 534.9 $ 140.0


Amounts Relating to
Claims Incurred During
As of December 31, 2003 Total 2003 2002 and Prior

IBNR and medical claims reserves $ 641.5 $ 615.7 $ 25.8
Pharmacy PBM payable 27.8 27.8 -
Stabilization and stop-loss pools,
BDCC and GME reserves, net (4.9) (11.3) 6.4
Other reserves 7.1 - 7.1
Medical Costs Payable Balance $ 671.5 $ 632.2 $ 39.3


Definitions

IBNR and medical claims reserves: Estimates of liabilities for incurred
but unreported medical claims including in-house inventories, adjudicated
but not yet paid claims, net liabilities under risk sharing arrangements
and reserves for previously denied claims.

Pharmacy PBM payable: Bi-weekly amounts due to the Company"s pharmacy
benefit manager based on submission of pharmacy claims.

Stabilization and stop-loss pools, BDCC and GME reserves, net: Estimated
net liabilities (receivables) related to various state programs including
New York market stabilization and stop-loss pools, bad debt and charity
care and graduate medical education surcharges.

Other reserves: Estimated liabilities for certain former medical
contracts that are in various stages of resolution.

Components of Medical Costs Payable

During the first quarter of 2004, total medical costs payable increased
$21.4 million from the balance at December 31, 2003. IBNR and medical
claims reserves as of March 31, 2004 represented approximately 95.6% of
total medical costs payable compared to 90.3% as of March 31, 2003.
Other reserves declined during the quarter primarily as a result of
settlement payments made to the Company"s former pharmacy benefit
manager.

Total days medical costs payable at March 31, 2004 and December 31, 2003
was approximately 58 days.


Exhibit 4

OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
SELECTED FINANCIAL STATISTICS
(In millions, except PMPM data)
(Unaudited)

2004 2003
1Q Full Year 4Q 3Q 2Q 1Q
Commercial
Premium
Revenues $1,217.1 $4,706.8 $1,191.8 $1,186.0 $1,173.9 $1,155.1
Medicare
Premium
Revenues 167.1 632.5 159.9 159.8 157.4 155.4
Total
Premium
Revenues $1,384.2 $5,339.3 $1,351.7 $1,345.8 $1,331.3 $1,310.5

Commercial
Medical
Costs $ 973.6 $3,711.2 $ 935.8 $ 921.6 $ 950.3 $ 903.5
Medicare
Medical
Costs 144.9 531.2 130.7 131.9 138.0 130.6
Total
Health
Care
Services
Expense $1,118.5 $4,242.4 $1,066.5 $1,053.5 $1,088.3 $1,034.1

Commercial
PMPM
Revenue $ 288.27 $ 269.62 $ 276.44 $ 272.66 $ 267.20 $ 262.36
Medicare
PMPM
Revenue $ 788.38 $ 743.79 $ 751.34 $ 750.16 $ 740.10 $ 733.53
Commercial
PMPM
Medical
Costs $ 230.60 $ 212.59 $ 217.06 $ 211.87 $ 216.31 $ 205.21
Medicare
PMPM
Medical
Costs $ 683.21 $ 624.59 $ 614.02 $ 619.14 $ 648.80 $ 616.66

Commercial
Medical
Loss
Ratio 80.0% 78.8% 78.5% 77.7% 81.0% 78.2%
Medicare
Medical
Loss
Ratio 86.7% 84.0% 81.7% 82.5% 87.7% 84.1%
Total
Medical
Loss
Ratio 80.8% 79.5% 78.9% 78.3% 81.7% 78.9%

MG&A
Expenses(1) $ 147.3 $ 575.1 $ 144.4 $ 143.7 $ 144.7 $ 142.3
Administrative
Loss Ratio
(ALR)(1) 10.6% 10.7% 10.7% 10.7% 10.8% 10.8%
ALR Run
Rate(2) 10.6% 10.7% 10.7% 10.7% 10.8% 10.8%


2002
Full Year

Commercial Premium Revenues $ 4,265.8
Medicare Premium Revenues 585.2
Total Premium Revenues $ 4,851.0

Commercial Medical Costs $ 3,374.9
Medicare Medical Costs 473.9
Total Health Care Services Expense $ 3,848.8

Commercial PMPM Revenue $ 244.11
Medicare PMPM Revenue $ 710.36

Commercial PMPM Medical Costs $ 193.13
Medicare PMPM Medical Costs $ 575.26

Commercial Medical Loss Ratio 79.1%
Medicare Medical Loss Ratio 81.0%
Total Medical Loss Ratio 79.3%

MG&A Expenses(1) $ 575.4
Administrative Loss Ratio (ALR)(1) 11.8%
ALR Run Rate(2) 11.1%


(1) - Excludes net litigation charges of ($151.3 million) in 2002 and
($45 million) in the first quarter of 2003, and $14.3 million of
litigation insurance recoveries in the third quarter of 2003.
(2) - Run Rate ALR excludes charges and recoveries related to the
securities class action litigation settlement costs in the first
quarter of 2003 ($45 million) and the recovery of $14.3 million in
the third quarter of 2003. Full year 2002 excludes total charges
and expenses of ($171.3 million) related the now settled securities
litigation and ($15.5 million) for the termination charge related
to the CSC contract.


Selected Trends and Financial Statistics

Commercial premium revenues increased $62 million over the first quarter
of 2003. Commercial premium yields, net of product mix and benefit
changes, increased approximately 9.9% over the first quarter of 2003.
Medicare premiums increased $11.7 million over the first quarter of 2003
as a result of the mix of membership and increased reimbursement rates.

Commercial per member per month (PMPM) medical costs for the first
quarter of 2004 increased approximately 11.8% compared to the 2003 first
quarter. This increase reflects the reported PMPM commercial medical
costs adjusted for net favorable development of commercial medical
reserves of approximately $3.3 million and $8.0 million in the first
quarter of 2004 and 2003, respectively, and the impact of one additional
business day in the first quarter of 2004. Adjusting for the additional
business day, commercial PMPM medical costs increased by approximately
10.7%. This increase was in line with management"s estimates for the
quarter and is consistent with management"s estimate of a full year
commercial PMPM medical trend between 9% and 10%.

The previously reported first quarter 2003 commercial PMPM medical costs
increased only 8.4% over the first quarter of 2002, creating an atypical
point of comparison for the current quarter"s results. The 2003 first
quarter PMPM commercial medical cost increase was lower than expected at
that time as a result of several one-time events affecting utilization in
that quarter. The remaining three quarters of 2003 had higher medical
cost trends and represent more normalized run rates for year-over-year
analysis. Full year 2003 PMPM commercial medical cost trends were
approximately 9.4%.


Exhibit 5

OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES
MEMBERSHIP DATA
(In thousands)
(Unaudited)

Total Ending
Membership 2004 2003 2002
1Q 4Q 3Q 2Q 1Q 4Q
POS, PPO and Other
Plans 1,216.6 1,239.4 1,252.0 1,260.0 1,276.8 1,252.9
HMO 187.5 190.5 191.5 196.5 204.0 226.6
Total Fully Insured
Commercial
Membership 1,404.1 1,429.9 1,443.5 1,456.5 1,480.8 1,479.5
Medicare 70.4 70.8 71.0 70.9 70.7 70.1
Third-party
Administration 37.1 38.5 39.8 40.8 41.1 51.9
Total Membership 1,511.6 1,539.2 1,554.3 1,568.2 1,592.6 1,601.5

Fully Insured
Commercial Change (25.8) (13.6) (13.0) (24.3) 1.3 0.7
Fully Insured
Commercial
Change % -1.8% -0.9% -0.9% -1.6% 0.1% 0.0%


Membership

Total fully insured commercial membership ended the quarter at
1.404 million members compared to 1.430 million members at the end of
December 2003. The decline in fully insured commercial membership for
the first quarter of 2004 was in line with management"s expectations.

Medicare membership remained relatively flat at 70,400 compared to 70,800
at December 31, 2003.



Source: Oxford Health Plans, Inc.
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