Wednesday, August 22, 2001

6 bidders line up
for ailing insurer

$10 million is needed
to purchase UHA

By Lyn Danninger

There are now six bidders interested in acquiring ailing health insurer University Health Alliance, state Insurance Commissioner Wayne Metcalf said yesterday.

Metcalf declined to disclose the names of the companies but said his division would begin a proposal evaluation process next week. Bidders would then be ranked and the division will enter into negotiations with the parties, he said.

Metcalf said his division contacted mainland as well as local insurers who would likely be interested in acquiring UHA's business.

Anyone purchasing UHA will have to prepared to invest a total of about $10 million in the company, he said.

"We are asking for them to demonstrate they can infuse $5 million into the company and then present a plan for an additional $5 million within a year," he said.

UHA's financial slide began toward the end of last year. During the last quarter of the year, the company picked up 14,000 new members when Queen's Health Plans decided to exit the insurance business. That brought the plan's total membership to around 32,000. The company then fell behind in its reserves and was forced to enter into a supervisory agreement with the Insurance Division.

Since June, a court appointed executive has overseen company operations.

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