Got a nice speculative option play for you fellas that are interested. Besides being alittle speculative on the options action the field that the stock is in is good and it just started catching up to the group. The option im reffering to is OCR. Today their was unusual call buying( Im assuming because prices ended up) on the OCR March 32.50x calls current cost is .60 . The volume was 1201 and the open interest is 357. Im assuming somebody had to have bought these because why would they sell them at this price now with a month left to go and when they could sell it for a higher price later in the future especially since the market looks to be headed higher. Next thing to be alittle speculative on somebody purchasing these that has information the street doesnt. Could be moving off some expectations of the news below and also they have earnings in two weeks and this stock has beat the earnings past 3 quaters in a row. They are in the medical field which the street seems to like now.
NEWS RELEASED ON FEB 4, 2009
Wednesday, February 4, 2009
Hospitals sue for Medicaid money
Six medical facilities claim they are owed $60M withheld by OmniCare Health Plan.
Christina Rogers / The Detroit News
Six Metro Detroit hospitals filed a motion Tuesday against three top executive officers of Detroit-based United American Health Corp. asking the court to hold them liable for withholding tens of millions of dollars to medical providers who treated Medicaid patients covered by OmniCare Health Plan, once the state's 10th largest HMO.
The motion is part of an ongoing lawsuit filed in 2005 against United American, which OmniCare hired in 1985 to manage its administrative services, including claims.
The hospitals participating in the suit are Beaumont Hospitals, Henry Ford Health System, Detroit Medical Center, St. John Health, Trinity Health and Oakwood Healthcare. They are suing for about $60 million in damages, resulting from what they claim was United American's mismanagement of finances for OmniCare, a provider of benefits to about 66,000 poor and disabled members through Michigan's Medicaid program.
In the motion, the hospitals argue that United American paid itself $54 million in management fees, rather than pay out the tens of millions of dollars in medical claims owed to the hospitals for treating Medicaid patients. The motion also alleges that the executive officers misrepresented the OmniCare's liabilities in order to continue collecting the management fees as OmniCare slid further into red ink.
The officers named in the filing are Paul Samuels and William Jackson II, who were chief financial officers for United American between 1998 and 2001, when the mismanagement was alleged to have taken place, and current CEO William C. Brooks, who was chairman of the board during this time period.
Rodger Young of Young & Susser, a Southfield law firm representing United American, said, "They have filed other motions on this and have yet to prevail on any of them." He said this motion will be denied yet again.
The motion asks for repayment of damages, with interest, an amount estimated at $83 million.
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