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PACIFICARE HEALTH SYSTEMS, HEALTH PLAN OF AMERICA MERGER FINALIZED

PACIFICARE HEALTH SYSTEMS, HEALTH PLAN OF AMERICA MERGER FINALIZED
 CYPRESS, Calif., Dec. 10 /PRNewswire/ -- PacifiCare Health Systems Inc. (NASDAQ: PHSY) and Health Plan of America (HPA), today announced that the merger of the two organizations has been finalized.
 PacifiCare Health Systems and HPA signed a definitive merger agreement on Sept. 25 after merger discussions between the two health care organizations were initiated earlier this year. HPA's purchase price was $91 million (subject to a net worth adjustment), which PacifiCare Health Systems paid through a combination of cash, debt and convertible debentures of PacifiCare Health Systems.
 According to PacifiCare Health Systems President and Chief Executive Officer Terry Hartshorn, "With the completion of this transaction, PacifiCare Health Systems now owns two California HMOs, PacifiCare and HPA. Both PacifiCare and HPA bring advantages to the market," he explained. "Our goal is to combine these strengths to improve quality, cost and flexibility."
 Hartshorn continued, "The senior managers at both organizations are currently involved in defining future business opportunities. It is our intention to operationally merge the two HMOs during 1992."
 HPA's President and Chief Executive Officer Lawrence Kugelman added that, "This merger has created an extremely strong health care organization, one that we believe will be a major force in this industry for many years to come."
 From PacifiCare Health Systems' perspective, the merger adds some 130,000 new HMO members, bringing PacifiCare Health Systems' system- wide membership to more than 850,000. Headquartered in Orange, Calif., HPA is one of the state's largest IPA (independent physician association) model HMOs. Additionally, the HPA merger will extend PacifiCare's California HMO provider network into several new areas including the Central Valley and the metropolitan Sacramento region. HPA's statewide coverage, combined with PacifiCare's extensive provider base, creates one of the state's most comprehensive provider networks.
 PacifiCare Health Systems owns and operates HMOs in California, Oklahoma, Oregon, Texas and Washington. The company also operates Secure Horizons, one of the nation's largest Medicare risk programs. Other operations include Columbia General, an insurance subsidiary licensed in 33 states; LifeLink, one of California's largest managed behavioral health care companies; and Pacific Review Services, a utilization review and case management company.
 -0- 12/10/91
 /CONTACT: Debby Iacunato, VP-corporate communications of PacifiCare Health Systems, 714-220-3745/
 (PHSY) CO: PacifiCare Health Systems Inc,; Health Plan of America ST: California IN: HEA SU: TNM


KJ-EH -- LA002 -- 0865 12/10/91 09:04 EST
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Publication:PR Newswire
Date:Dec 10, 1991
Words:398
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