Health Net 1999 Annual Report Download - page 12

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10 FOUNDATION HEALTH SYSTEMS, INC.
This intensely consumer-focused effort is a key asset as we pursue
enhanced consumer service strategies in our other lines of business.
costs. Stockholders should expect that Medicare
enrollment may well decline in coming years as
we review our plans across the country. In every
case, we will not continue to offer services if we
cannot guarantee access to quality health care and
we will, very likely, continue to add premiums and
selectively pare benefits to maintain the financial
viability of our Medicare programs.
GOVERNMENT AND SPECIALTY
SERVICES DIVISION
Government Contracts and Specialty Services
revenues rose 8 percent, to $1,529,855,000 in
1999, as the Division’s gross margin contribution
also climbed 8 percent to $526,962,000.
Government Contracts
Our Government Contracts business is comprised
primarily of three contracts in the Civilian Health
and Medical Program of the Uniformed Services
(CHAMPUS), now referred to as the TR ICAR E
program. FHS serves approximately 1.5 million
dependents of active duty military personnel and
retired military personnel through these contracts,
which cover nine states plus small portions of
two additional states.We continued to effectively
manage these programs for the Department of
Defense (DoD) in 1999 and, early in 2000,
received a one-year extension for R egion 11,
which includes Washington and Oregon.We are
seeking one-year extensions on the two other
contracts as well.
Managed Health Network (MHN)
MHN, our behavioral health subsidiary, had
another stellar year and added one million new
members for the early part of 2000.The primary
growth engine for MHN is Employee Assistance
Programs (EAPs).Among the many Fortune 500
companies that are MHN clients, such programs
have gained increasing popularity as they move
beyond mental health care to encompass a wide
variety of other services such as child care, elder
care and financial assistance.This intensely
consumer-focused effort is a key asset as we
pursue enhanced consumer service strategies in
our other lines of business.