HSI FILLS NEW POST : POSITION DESIGNED TO UNBURDEN CEO.

Byline: Dawn Yoshitake Daily News Staff Writer

Health Systems International Inc. named financial consultant and former health care executive Jay Gellert as president and chief operating officer Wednesday, giving him control of the day-to-day operations of the fast-moving company.

The move frees Dr. Malik Hasan, HSI chief executive and chairman, to concentrate on the future direction of the Woodland Hills-based managed care company.

Gellert, who will fill the newly created position Monday, will also serve as chairman of HSI's managed care subsidiaries Health Net and QualMed. And he will also serve as a board member.

``I'll oversee the operations of Health Net and QualMed and assist in mergers and acquisitions with Dr. Hasan,'' said Gellert, 42.

Hasan, in a statement, says: ``Jay is the first new member of what will be an expanded management team at HSI. We will make additional announcements in the days ahead as HSI prepares to execute an aggressive growth strategy based on continued expansion of our existing businesses, acquisitions and the development and implementation of new medical management systems.''

Gellert envisions his job will take on three challenges - the rolling out of new products, the formation of partnerships with physician groups and hospitals and the execution of more acquisitions.

``We want to design small business products because there is a need and we have experience in the medium to big business range,'' he said. ``We also want to offer a Medicare product that allows seniors to get care within an HMO environment or go outside the system with a co-pay.''

Analysts said Gellert's background will be an asset in achieving his goals for HSI.

He previously worked for investment firm Shattuck Hammond Partners, which specialized in health care. During his two-year tenure, Gellert last year advised HSI on its failed merger attempt with WellPoint Health Networks and a $100 million merger with M.D. Enterprises of Connecticut Inc. - that state's third largest HMO.

And in the late 1980s, Gellert served as chief executive for Bay Pacific Health Corp., an HMO company based in San Bruno, Calif.

``When I took over the company, it was losing money. But during the three years I was there, it turned a $10 million profit,'' he said. ``Revenues during that time also grew 25 percent.''

He added Bay Pacific was successful in launching partnerships and introducing a number of new products.

Edward Keaney, an analyst with Volpe, Welty & Co., said Gellert is a good fit for HSI.

``I think he's a really good choice for the day-to-day operations of the company,'' Keaney said. ``Dr. Hasan's strengths are in developing strategies and he can use some able manager to execute the vision he has to reposition the company.''

In another change announced Wednesday by HSI, acting Health Net chairman and chief executive Michael E. Gallagher resigned. But Gallagher will remain as an HSI director and will rejoin Shamrock Investments as a partner.

Hasan also is expected to name a chief financial officer to replace retiring Keith Hovland, as well as new department heads for its subsidiaries.