Medica expects to return to positive operating results during 1998. Medica continues to maintain state-mandated reserves to absorb operating losses caused by rapid increases in health care costs. Health plan reserves also allow interest income to be shared with customers in the form of lower premiums and coverage improvements. We have also been able to continue our investments in health improvement, such as the addition of nicotine replacement therapy to our covered benefits. Medica is actively supporting legislation that would allow Minnesota health plans to increase the number of months' expenses health plans are allowed to keep in reserve.
Current law limits health plan reserves to between one and two months of expenses.
Minnesota is the only state in the country to place an upper limit on health plan reserves. Medica was at 1.58 months in reserve at year end 1997. Medica is part of Allina Health System, a Minneapolis-based integrated health care system comprised of doctors, hospitals and health plans serving communities throughout Minnesota, western Wisconsin, and both North and South Dakota. Allina's vision is to be the recognized innovator in community health improvement. This site is presented for information only and is not intended to substitute for professional medical advice.