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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: BDR who wrote (11936)	7/23/1998 11:12:00 AM
From: BDR	Respond to of 18691

Re:UNH Specifics regarding the complaint about the UNH-HUM merger can be found at: quotecentral.com if the link works. From the July 15 PR Newswire article_ "In a letter sent by its legal counsel last week, the hospital association argued that the merger of the two large HMOs would create a powerful entity that would stifle competition in the Chicago area. The merged entity would control approximately 90% of the Chicago-area Medicare HMO market, between 60% and 70% of the Illinois Medicaid managed care market, and 32% of the Illinois HMO market. Its only significant competitor would be Blue Cross and Blue Shield of Illinois, with about 26% of the market. Such excessive market power is likely to lead to "health care purchasers, providers, and patients (experiencing) increased premiums and reduced services if the merger is permitted to go forward," IHHA's attorneys concluded. The letter also cited difficulties encountered with United's business practices. Consumers have filed more complaints about United with the Illinois Department of Insurance than about any other HMO; providers contracting with United report late payments and problems with eligibility verification; and employers have experienced unacceptable premium increases and slow claims processing. If United absorbs Humana it is likely to continue such practices, the letter warned."

To: BDR who wrote (11936)	7/23/1998 8:22:00 PM
From: John Rowton	Respond to of 18691

I live in Illinois and the politicians are screaming about the proposed merger. I know plenty of people whom I have worked with and who were in UNH. almost to a person, they are gone as soon as possible. I think that the sector is ripe for a short, the put options just made me short more and there is nothing positive that can come out this sector with the pols in washington getting involved. when earnings come in, if they beat, i doubt if i will get hurt too much as i have 4 points already, if the earnings miss, maybe another CA.