A.M. Best Assigns Initial Rating to QCA Health Plan, Inc.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Nov. 3, 2003 A.M. Best Co. has assigned an initial financial strength rating of C++ (Marginal) to QCA QCA - Quantum-dot Cellular Automata Health Plan, Inc. (QCA) (Little Rock, AR). The rating outlook is stable. The rating of QCA was primarily influenced by the company's weak capital position, the current competitive environment of its market and the size of its risk membership base. The current financial condition of QCA is due to accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. in its early formative formative /for·ma·tive/ (for´mah-tiv) concerned in the origination and development of an organism, part, or tissue. years. The depletion of the initial capital reserves of QCA were bolstered by a number of surplus notes provided by five investor organizations, which represent a very large portion of QCA's current capital and surplus position. Its primary controlling affiliate, QualChoice of Arkansas, also exhibited weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. balance sheet strength for similar reasons as QCA and this potentially exposes the health plan to certain vulnerabilities. QCA's size identifies a need for further business development in order to spread unit costs so that overall profitability can continue to be enhanced. A.M. Best acknowledges that QCA is in the process of executing its turnaround plan. As such, for fiscal year 2002 it reported the first operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in its history. Year-to-date 2003 results continued operating profits. Furthermore, the company's management launched a series of turnaround initiatives over the past three years, which included improving the medical management process, re-negotiating certain provider contracts and exiting unprofitable lines of business. QCA is viewed as a local health plan and benefits from strong support in the local medical community. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion