PacifiCare Posts Higher Quarterly Revenue, Net Income

SANTA ANA — Managed health care services giant PacifiCare Health Systems Inc. posted higher net income for the third quarter, while revenue doubled.

Net income totaled $30.8 million, or 67 cents a share, up from $3.5 million, or 11 cents a share, in the year-earlier period, which included charges of $58.7 million for restructuring and other expenses.

The company reported that total membership increased 89% to more than 3.8 million for the quarterly, primarily as a result of PacifiCare’s acquisition of Orange County rival FHP International Inc.

Per-share results beat the 65-cent average estimate of 19 analysts surveyed by IBES International Inc., which helped PacifiCare Class B shares rise $3.13 to $68.38. The Class A shares of stock rose $3 to $67.88.

However, total health-care costs rose even as the company tried to cut costs through reductions in marketing expenses and efficiencies in administrative and information systems. PacifiCare’s medical-loss ratio--a closely watched measure of how much of premium revenue it spends on patient care--rose to 85.9% from 84.2% a year earlier.

For the first nine months, net income rose to $92.3 million, or $2.11 a share, from $44 million, or $1.39 a share, for the comparable three quarters of 1996. Revenue advanced 83% to $6.6 billion from $3.6 billion.