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State lowers HMSA insurance rate hike

The state Insurance Division has denied Hawaii Medical Service Association's request for an 11.5 percent rate increase for its small business customers.

In a letter to HMSA, the division said it approved a 9.87 percent increase for the insurer's most popular coverage, the preferred provider plan.

State Insurance Commissioner J.P. Schmidt could not be reached for comment.

Steve Van Ribbink, HMSA senior vice president and chief financial officer, said his company has been in discussions with the division and re-filed for the new rate increase yesterday so it can go in effect July 1 as planned.

"We respectfully disagree with them but given the alternative, we feel it's better to comply and re-submit," Van Ribbink said.

But Van Ribbink said he will sit down with the division at a later date to discuss issues related to the filing and the division's rationale for approving a smaller rate than was sought.

"I'm still unclear what they disagreed with so we intend to meet with them to discuss it for future filings so it will operate smoother," he said.

The change in rates will cost HMSA $3.5 million, Van Ribbink said.

Kamehameha completes land sale

Kamehameha Schools has concluded its sale of 390,000 acres of timber land in Michigan to a forest management partnership headed by the Forestland Group LLC, headquartered in North Carolina. The price was not disclosed.

Kamehameha said the sale is in line with its plans to reduce its mainland holdings. Kamehameha, formerly known as the Bishop Estate, made many mainland investments over the years as it sought to expand resources that would help its role as a trust for the education of children of Hawaiian ancestry.

The trust said it made a "favorable return" on the forest investment. The Forestland Group said it will manage the property as a long-term timber land investment.

Palm to buy rival Handspring

SAN JOSE, Calif. >> Palm Inc., the leading maker of personal digital assistants, said yesterday it plans to acquire challenger Handspring Inc., which was created five years ago by Palm's founders.

The deal calls for the Silicon Valley rivals to merge after Palm completes its spinoff of PalmSource, the unit that makes the Palm operating system for handheld computers. The transactions are expected to be completed back-to-back in the fall, and the merged company will be renamed, the companies said.

Under the proposed terms, Handspring's shareholders will receive 0.09 Palm shares -- and no shares of PalmSource -- for each share of Handspring stock owned. Palm will issue 13.9 million shares of Palm common stock to Handspring's shareholders on a fully diluted basis.

As a result, Handspring's shareholders would own approximately 32.2 percent of the newly merged company, and Palm's shareholders would own approximately 67.8 percent. The current value of the deal is unclear, since Palm shares currently include the PalmSource subsidiary. The merged company will be renamed, the companies said.

The deal could give Palm a desperately needed foothold in the market for handhelds with phone and wireless data functions, and jolt Handspring with an infusion of cash and marketing power.

United Airlines aims at business travelers

CHICAGO >> United Airlines is kicking off its biggest advertising campaign since 2001 in a push to lure back more business travelers while it overhauls its operations in bankruptcy.

The promotion -- four trips for the price of three -- is being backed by full-page ads in national newspapers and others in key markets throughout the summer travel season that is critical to United's recovery.

Under the initiative announced yesterday, customers enrolled in United's frequent-flier program who fly three eligible paid round trips between today and Sept. 30 will earn a free round-trip ticket for travel in the 48 contiguous states between Sept. 2 and the end of the year. The deal covers mainly pricier tickets -- first and business classes and coach fares that don't require a Saturday night stay. A maximum of two free tickets can be earned.

In other news ...

>> California's economy will likely emerge from recession by the end of the year, but the recovery probably won't translate into more than a small percentage increase in new jobs, according to a report released yesterday by the University of California, Los Angeles.

>> A federal jury yesterday ordered Taco Bell Corp. to pay $30.1 million to two men who claimed the fast-food chain stole their idea for the advertising campaign featuring a talking Chihuahua.

>> Clear Channel Communications Inc. will strengthen its position as the largest owner of U.S. radio stations under new federal media-ownership rules, analysts said; the company has said it would be harmed by the regulations.

>> Fleming Cos., the grocery distributor that filed for bankruptcy protection in April, said it will restate its 2000 financial results by about $2 million and has delayed filing its first-quarter report.

>> A federal grand jury has indicted the former chairman of health services giant McKesson Corp., alleging he conspired in an accounting ruse that inflicted $9 billion in shareholder losses after it unraveled four years ago.

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[Hawaii Inc.]

Promotions

>> Tom Barlow has been named president and chief executive officer of Pacific Resources for Education and Learning. He replaced company founder John Kofel, who retired. Barlow joined PREL in 1996 and has served as chief operating officer of the company since 2000. PREL is a nonprofit organization that supplies education services. 

>> CB Richard Ellis Hawaii Inc. has promoted Roger B. Lyons to senior vice president from vice president. He is a director of CBRE Hawaii and works in the retail arena, representing both tenants and landlords. He has been with the company for 15 years. 

>> Charlene "Charlie" Goodness has been promoted to hotel manager food and beverage operations for Mauna Kea Beach Hotel and Hapuna Beach Prince Resort. She was previously food and beverage director for Mauna Kea Beach. Goodness will oversee the quality and operations of ten outlets between the two hotels. The company has also hired Wade Gesteuyala as hotel manager rooms operations. He comes from Pacific Island Club in Guam and has previously worked at Hawaii Prince Hotel Waikiki as executive housekeeper.

On the board

>> Parents and Children Together has elected Phillip Deaver chairman for 2003-04. Deaver is a partner in the law firm Bays Deaver Lung Rose Baba. Other board officers are: Urban Real Estate Co. Housing Manager Director Lui Faleafine Jr., vice chair; Bally Shoes Regional Manager Valerie Sylvester, secretary; Tax Foundation of Hawaii Executive Director Lowell Kalapa, treasurer; Plan Pacific President John Whalen, past chair. New members of the board of directors are Early Head Start and Head Start Program Consumers Johnelle Kimura and Terri Lyn Torres, and American Savings Bank Community Relations Manager Kimberly Yatomi.