PacifiCare Health Systems Names Sam Ho, M.D., Senior Vice President, Chief Medical Officer and Pete McKinley, Senior Vice President, Network Management

Business Wire, May 24, 2002

Business Editors & Health/Medical Writers

SANTA ANA, Calif.--(BW HealthWire)--May 24, 2002

-- Promotions Further PacifiCare's Efforts to Streamline Regional and Corporate
Operations

-- Ho and McKinley to Lead Consolidated Health Services and Network Management
Departments, Respectively

PacifiCare Health Systems Inc. (Nasdaq:PHSY), named Sam Ho, M.D., senior vice president and chief medical officer, effective immediately.

He replaces Michael Kaufman, M.D., J.D., who left the company to pursue other interests. In addition, McKinley has been promoted to senior vice president, network management, to head a consolidated network management department.

Ho will be responsible for developing and implementing strategies to improve the quality and cost-effectiveness of health-care services throughout the company. He will report to Brad Bowlus, executive vice president of PacifiCare Health Systems and president and chief executive officer of the company's health plans division.

"Sam's extensive experience in improving clinical and service outcomes, developing innovative consumer health programs and fostering close working relationships with physicians and purchasers position PacifiCare to better meet the needs of today's and tomorrow's health services marketplace," said Bowlus.

"Sam has spearheaded our distinctive quality initiatives, such as our QUALITY INDEX(R) profile of medical groups, and led the way in PacifiCare's achieving 'excellent' accreditation status, the highest level of distinction, by the National Committee for Quality Assurance (NCQA) in five states."

Ho said, "My goal as chief medical officer is to continue PacifiCare's success as a leader in quality and comprehensive medical management so that we may better service our members."

Ho joined PacifiCare of California in 1994. Throughout his tenure he has developed and implemented innovative quality initiatives that resulted in substantial improvement in population health outcomes and exemplary achievement of systemwide NCQA accreditation.

Prior to joining PacifiCare, Ho served as senior vice president, health services at Woodland Hills, Calif.-based Health Net Inc. He has also served as deputy director of health, medical director and county health officer for the San Francisco Department of Public Health.

He has held faculty appointments at both the Schools of Medicine and Nursing at the University of California, San Francisco. He has held positions as the chairman of the California Medical Association and California Nurses' Association's Joint Practice Commission.

The Honolulu native received his bachelor's degree in sociology from Northwestern University in 1972 with Phi Beta Kappa honors, and his medical degree from Tufts University School of Medicine in 1976. Ho completed his residency in family practice at the University of California, San Francisco.

PacifiCare also announced that McKinley has been promoted to vice president of network management. He previously served as president of PacifiCare of California's Northern California operations. As senior vice president, network management, McKinley will oversee the newly consolidated network management department, which includes network architecture, provider contracting, network operations and contracting standards. He also will report to Bowlus.

McKinley brings extensive relationship experience and a proven background in hospital and physician management, including chief operating officer for ReadyScript Corp., president and CEO for IntensiCare Corp. and vice president of Business Development for Talbert Medical Management Corp.

Prior to PacifiCare's acquisition of FHP International Corp., he served various executive and management roles at FHP including vice president of provider services and network development, associate regional vice president of IPA Management and associate vice president of medical center operations.

McKinley received his bachelor's degree in business administration from the University of Southern California and his master's degree in business administration from Pepperdine University.

"Pete's years of health-care management experience and his success in leading our Northern California operations will be a tremendous asset for our newly consolidated network management department," said Bowlus.

"His experience at Talbert Medical Management and executive management positions with FHP better strengthen PacifiCare's network management strategy. I look forward to working with Sam and Pete to further our success with our quality initiatives and enhance our relationships with doctors, medical groups and hospitals to improve the quality of care for our members."

Ho's and McKinley's promotions are part of the company's overall effort to consolidate core functions between the company's corporate office and its California health plan.

"As we continue our strategy of transitioning to a health and consumer services company, it is imperative that we operate on a more integrated basis," said Howard G. Phanstiel, president and CEO of PacifiCare Health Systems. "We have spent considerable time and energy developing an experienced team of executives and managers dedicated to PacifiCare's strategy and growth."