Health Net 1998 Annual Report Download - page 4

Download and view the complete annual report

Please find page 4 of the 1998 Health Net annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 60

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60

2F O U N DAT IO N HEALT H SYST EM S, I N C.
Jay Gellert
P resident & Chief Executive Off i c e r
F H S
In August of 1998, Jay Gellert became chief executive officer of FHS. Since his election, Jay’s central mission
has been to focus the company on its core operations to bring needed clarity to the business, reduce corporate
debt and prepare for future growth.
Jay previously served as president and chief operating officer of FHS. Prior to joining the company in 1996, Jay
oversaw strategic advisory engagements for Shattuck Hammond Partners Inc.
In the second half of 1998, we recommitted ourselves to making Foundation Health Systems,Inc.
(FHS) an organization that focuses on the basics of serving the health care needs of our members.
The reason FHS exists,after all,is based on the simple fact that health care is one of the most
important parts of people’s lives. By focusing on the basics of high quality health care and service,
we will demonstrate that managed care works and works well when provided by sound,stable
organizations.By effectively meeting the health care needs of our customers, we can successfully
address the many and often controversial issues surrounding managed care today.And, in meeting
these needs, we will serve our stockholders’ interests as well.
Thanks to the dedicated and tireless efforts of many in our management team,FHS has made
remarkable progress by focusing on three vital goals: one, strengthen the company by generating
positive cash flow on a consistent basis; two, divest non-core properties that were and are a drain
on our management and financial resources;and three, focus relentlessly on improving the perfor-
mance of our core operations and revamping our management team. For you,our stockholders,it
is most important to remember that FHS possesses outstanding core operations with market-lead-
ing health plans in California,Arizona and the Northeast.We also have interesting oppotunities in
Florida, Oregon and Washington. Our specialty operations include Managed Health Network, one
of the nation’s leading mental health management organizations,as well as growing dental and
vision companies.Finally, we are the leading contractor for the Department of Defense’s Civ i l i a n
Health and Medical Program of the Uniform e d Services (CHAMPUS).These are the core opera-
tions that represent the future of FHS.
In 1998, we addressed several pressing issues.We re s o l ved the cash flow issue, g e n e r a t i n g
m o re than $100 million in positive operating cash flow, despite being negative by more than