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UNITED WISCONSIN SERVICES REPORTS HIGHER EARNINGS

 UNITED WISCONSIN SERVICES REPORTS HIGHER EARNINGS
 MILWAUKEE, Wis., July 28 /PRNewswire/ -- United Wisconsin Services,


Inc. (NASDAQ: UWSI) today announced earnings for the six-month period ended June 30, 1992, which are 146 percent ahead of the same period last year. The company also reported second quarter earnings that are 129 percent higher than the same period in 1991.
 "Our strategy of balanced diversification in our core HMO managed care, employee benefit and insurance businesses continues to result in strong earnings and growth," noted Thomas R. Hefty, chairman, president and chief executive officer of UWSI. "Each of our three major business units achieved revenue growth in excess of 20 percent and earnings growth in excess of 50 percent for the six months ended June 30, 1992. We have also benefitted from the stabilization of inflationary trends in health care," according to Hefty, who said that if health care inflation does not resume at higher levels, it may continue to provide additional earnings as the claim reserve level is adjusted to reflect lower trends. Hefty cautioned, however that most observers expect health care inflation to return to higher traditional levels.
 UWSI reported 1992 year-to-date earnings of $12.0 million, or $1.63 per share. These earnings reflect a 146 percent increase over last year's earnings for the same period of $4.9 million, or $.82 per share. Year-to-date revenue totalled $201.2 million, or 28 percent over last year's revenue of $156.9 million for the same period.
 For the second quarter, UWSI reported earnings of $6.8 million, or $.92 per share, 129 percent ahead of 1991 second quarter earnings of $3.0 million. Revenues for the quarter were $102.1 million, 37 percent ahead of 1991's second quarter revenues of $74.4 million.
 Following are individual performance figures for UWSI's subsidiaries and joint venture relationship.
 HMO OPERATIONS
 HMO Operations continued to experience strong earnings growth for the second quarter, reporting a 91 percent increase in quarterly earnings over the same period last year. Earnings growth for the quarter, and year-to-date, is attributable to both an increase in earned fees and improvements in operating expense and claims ratios. In addition, these results for the first six months of 1992 include Midelfort Health Plan which was acquired effective Jan. 1, 1992.
 HMO Operations reported growth in second quarter earnings from $1.3 million in 1991, to $2.5 million in 1992. Earned fees for the same period grew from $50.2 million in 1991 to $61.4 million in 1992, an increase of 22 percent.
 For the six months ended June 30, 1992, HMO Operations earnings of $4.0 million are 95 percent ahead of the $2.1 million for the same period in 1991. Earned fees have grown from $101 million for the first two quarters of 1991 to $123 million for the first two quarters of 1992, a 23 percent increase.
 According to Hefty, "Although the HMO market here is mature, the combination of traditional underwriting with managed care is paying off. Our HMO Operations continue to show an improved profit margin."
 AMERICAN MEDICAL SECURITY
 American Medical Security, Inc. (AMS), UWSI's joint venture, continues to report strong results. AMS primarily markets and administers low cost health insurance products on behalf of UWSI to small employer groups.
 UWSI second-quarter earnings attributable to business sold by AMS have grown from $761,000 in 1991 to $3,409,000 in 1992. Year-to-date earnings have experienced a similar increase from $1.1 million in 1991 to $6.0 million in 1992. While continuing to focus on growth in sales, AMS has also been successful at identifying underwriting risk and improving its operating efficiency, which have favorably impacted expense and loss ratios.
 For the quarter, UWSI premiums attributable to business sold by AMS have grown 94 percent from $15.2 million in 1991 to $29.5 million in 1992. Year-to-date, premiums have grown 40 percent from $39.2 million in 1991 to $54.9 million in 1992.
 UNITED WISCONSIN GROUP
 The United Wisconsin Group (UWG), consisting of the company's life and casualty operations, has shown strong growth for the first six months of 1992. For the first two quarters of 1992, UWG's earnings of $2.4 million are 68 percent above $1.4 million in earnings for the same period in 1991. Premiums for the first two quarters in 1992 are $12.1 million, 22 percent ahead of the $9.9 million in premiums for the same period in 1991.
 Second quarter earnings increased from $706,000 in 1991 to $1,259,000 in 1992. Premiums for the quarter have risen 23 percent over last year, from $5.1 million in 1991 to $6.3 million in 1992.
 OTHER OPERATIONS
 UWSI's other operations, which include Proservices, Take Control, Meridian and United Heartland, posted second quarter earnings of $137,000 on revenues of $1,720,000.
 For the first six months of 1992, earnings were $94,000, a 67 percent decrease over the same period in 1991. Revenues for the same period were $3.2 million, a 42 percent increase over the first six months of 1991. Year-to-date results for these operations reflect start-up costs for Meridian Resource Corporation, a health care and benefits consulting company established in January 1992.
 United Wisconsin Services, Inc., formerly a wholly owned subsidiary of Blue Cross & Blue Shield United of Wisconsin, is a leading provider of group health insurance and managed health care services, primarily in Wisconsin.
 Compcare Health Services Insurance Corporation, a wholly owned subsidiary of United Wisconsin Services, is Wisconsin's largest and oldest health maintenance organization. In addition, UWSI has a joint venture agreement with American Medical Security, Inc., which markets and administers, on behalf of UWSI, low-cost health insurance to employers with typically 25 or fewer employees. In addition to health insurance, UWSI, through the United Wisconsin Group, also underwrites and markets long-term and short-term disability, vision, life, workers' compensation and other insurance. Through various other subsidiaries, UWSI also markets managed care services and computer software for electronic claims processing to health care providers.
 UNITED WISCONSIN SERVICES, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except share and per-share data)
 (Unaudited)
 Three Months Ended Six Months Ended
 6/30/92 6/30/91 6/30/92 6/30/91
 Revenues:
 Earned health and
 disability premiums $92,120 $66,847 $180,989 $142,458
 Earned life premiums 4,655 3,515 8,878 7,084
 Net investment income 3,306 2,813 6,305 4,888
 Net realized investment
 gains 350 184 1,969 547
 Other revenue 1,688 1,009 3,055 1,883
 Total revenues 102,119 74,368 201,196 156,860
 Expenses:
 Capitation 30,669 32,111 64,197 64,332
 Incurred health and
 disability claims 42,340 23,846 81,063 55,816
 Life insurance benefits 2,254 1,907 4,527 3,950
 Total claims and
 capitation 75,263 57,864 149,787 124,098
 Commission expenses 4,184 2,291 7,811 5,590
 Administrative expenses 10,958 8,252 21,942 16,431
 Premium taxes and other
 assessments 915 627 1,788 1,478
 Interest and profit sharing
 on joint ventures 751 567 1,941 953
 Dividends on preferred stock
 of subsidiary 613 613 1,225 1,225
 Total expenses 92,684 70,214 184,494 149,775
 Income before income tax
 expense 9,435 4,154 16,702 7,085
 Income tax expense 2,611 1,178 4,671 2,187
 Net income $6,824 $2,976 $12,031 $4,898
 Earnings per common share $.92 $.50 $1.63 $.82
 Weighted average common
 shares 7,380,000 6,000,000 7,380,000 6,000,000
 -0- 7/28/92
 /CONTACT: Tom Lujak of United Wisconsin Services, 414-226-5756/
 (UWSI) CO: United Wisconsin Services, Inc. ST: Wisconsin IN: INS SU: ERN


KH -- MN016 -- 4300 07/28/92 17:27 EDT
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