A.M. Best Assigns Initial Ratings to Health Insurance Plan of Greater New York and its Subsidiaries.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Sept. 5, 2002 A.M. Best Co. has assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. an initial financial strength rating of B++ (Very Good) to Health Insurance Plan of Greater New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (HIP-NY) and HIP Insurance Company of New York. Additionally, A.M. Best has assigned an initial financial strength rating of B+ (Very Good) to the subsidiaries of HIP-NY, Vytra Health Plans Long Island Inc. and Vytra Health Services health services Managed care The benefits covered under a health contract , Inc. HIP-NY's rating reflects its year after year's operating performance, improved capital position and market presence. Offsetting these factors is the operating performance on certain lines of business and the geographic concentration of the organization. HIP-NY has recorded a net gain of $84.1 million as of December December: see month. 31, 2001, compared to a gain of $81.3 million for the prior period. The company has recognized improvements in fundamental profitability drivers: stable membership, administrative expenses and controlled medical loss ratio. The strong earnings have complemented the growth of capital to $280.3 million as of June 30, 2002, compared to $192.4 million for year-end 2001. HIP-NY continues to maintain good market share in its service area with 30% of the managed care population. A.M. Best believes the support of a strong provider network gives it a substantial competitive advantage in accessing health care providers and ultimately controlling medical costs. Over the last four years, HIP-NY has reported an underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. gain where the margin has been impaired by losses in certain segments. The largest losses were experienced in its medical only and Medicaid Medicaid, national health insurance program in the United States for low-income persons; established in 1965 with passage of the Social Security Amendments and now run by the Centers for Medicare and Medicaid Services. lines of business, which reported losses of $3.2 million and $7.2 million, respectively. In A.M. Best's opinion, while 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. occurred in certain segments, it was not enough to offset the gains in the commercial Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. +Choice and Medicare Supplement lines of business. A.M. Best expects as HIP-NY continues to address the issues related to the poor experience in certain segments, overall profitability should improve. HIP-NY's service area is relatively limited, currently offering its products in the five boroughs of New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , Nassau, Suffolk, Westchester, Orange and Rockland counties, while its wholly-owned subsidiary, Vytra Health Plans operates in Suffolk, Nassau and Queens. A.M. Best notes the product portfolio along with the limited geographic market area may pressure future growth. A.M. Best has assigned a stable outlook. 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. --30--bw/ny* csm
CONTACTS: A.M. Best Co.
Public Relations
Jim Peavy, 908/439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Striegel, 908/439-2200, ext. 5378
rachelle.striegel@ambest.com
or
Analyst:
Christopher Formica, 908/439-2200, ext. 5045
christopher.formica@ambest.com
KEYWORD: NEW JERSEY NEW YORK
INDUSTRY KEYWORD: INSURANCE
SOURCE: A.M. Best Co.
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