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PACIFICARE HEALTH SYSTEMS ANNOUNCES FIRST QUARTER RESULTS

 PACIFICARE HEALTH SYSTEMS ANNOUNCES FIRST QUARTER RESULTS
 CYPRESS, Calif., Feb. 3 /PRNewswire/ -- PacifiCare Health Systems, Inc. (NASDAQ: PHSY) announced today that operating revenue for the first quarter ended Dec. 31, 1991 increased 29 percent to $360,079,000 compared to revenue of $279,190,000 for the same quarter last year. Earnings for the quarter were $6,632,000, or $0.57 per share, compared to earnings of $2,509,000, or $0.21 per share last year. Total membership increased by 192,096 to 873,807 at December 31, 1991. The first quarter results incorporate the effects of the previously announced acquisition of The Health Plan of America ("HPA"), which added approximately 130,000 members to the company's operations, effective Dec. 9, 1991.
 "The results for the December quarter reflect a continuing focus on margin improvement," said Terry Hartshorn, president and chief executive officer. "A nearly two percentage point improvement in our operating margin, which was 2.1 percent of operating revenue at the quarter end, was primarily a result of substantially lower health care costs as a percentage of premium revenue.
 "PacifiCare's contracting health care providers continue to effectively manage the delivery of health care and their efforts this quarter have resulted in lower than average commercial hospital utilization. Slightly offsetting some of the quarter's improvement was an increase in Medicare prescription drug costs, due to the implementation of a prescription drug benefit in June 1991. Increased staffing to support administrative reorganization and new business development also added costs.
 "Looking ahead, we are particularly excited about our recent acquisition of HPA and the potential it brings to our existing California operations," said Hartshorn. "We are also encouraged by federal and state governments' increased promotion of HMOs as an alternative to traditional health insurance."
 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 and fastest growing Medicare risk programs. Other operations include Columbia General, an insurance subsidiary licensed in 35 states; Pacific Review Services, an independent utilization review and case management company; and LifeLink, a chemical dependency and behavioral health company.
 PACIFICARE HEALTH SYSTEMS, INC.
 (in thousands except per share data)
 (unaudited)
 Three months ended
 Dec. 31,
 1991 1990
 Income Statement
 Premiums $357,315 $277,184
 Other income 2,764 2,006
 Total operating revenue 360,079 279,190
 Health care services 301,718 242,502
 Marketing, general &
 administrative expenses 50,794 36,112
 Operating income 7,567 576
 Interest income 4,427 3,723
 Minority interest (21) ---
 Interest expense (284) (110)
 Amortization of intangibles (294) (22)
 Income before income taxes 11,395 4,167
 Provision for income taxes 4,763 1,658
 Net income $6,632 $2,509
 Weighted average number
 of shares outstanding 11,726 11,712
 Earnings per share $0.57 $0.21
 Operating Statistics
 Medical loss ratio (health care services
 as a percentage of premium revenue):
 Consolidated 84.4 pct. 87.5 pct.
 Commercial 82.2 pct. 88.1 pct.
 Secure Horizons Medicare 86.9 pct. 86.8 pct.

 Marketing, general & administrative
 expenses as a percentage
 of operating revenue 14.1 pct. 12.9 pct.
 Operating revenue as a percentage
 of operating revenue 2.1 pct. 0.2 pct.
 At Dec. 31, 1991
 Secure
 Comm'l Horizons Total
 Membership Data
 PacifiCare of California 517,587 136,856 654,443
 PacifiCare of Oklahoma 99,263 3,036 102,299
 PacifiCare of Oregon 52,921 20,549 73,470
 PacifiCare of Texas 33,078 10,517 43,595
 Total membership 702,849 170,958 873,807
 At Dec. 31, 1990
 Secure
 Comm'l Horizons Total
 Membership Data
 PacifiCare of California 376,413 109,535 485,948
 PacifiCare of Oklahoma 90,550 0 90,550
 PacifiCare of Oregon 47,428 18,163 65,591
 PacifiCare of Texas 33,421 6,201 39,622
 Total membership 547,812 133,899 681,711
 At At
 12/31/91 9/30/91
 Balance Sheet Data
 Cash & equiv. and marketable securities $271,234 $205,846
 Medical claims and benefits payable $184,800 $175,700
 Total assets $474,690 $322,328
 Long-term debt $53,654 $2,280
 Total shareholders' equity $106,974 $99,678
 -0- 2/3/92
 /CONTACT: Wayne Lowell, CFO, 714-952-1121, or David K. Erickson, 714-229-2636, both of PacifiCare/
 (PHSY) CO: PacifiCare Health Systems ST: California IN: HEA SU: ERN


KJ -- LA037 -- 6381 02/03/92 17:03 EST
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Date:Feb 3, 1992
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