"Oxford Health has convinced Wall Street it has pulled off a turnaround that is nothing short of legendary. This legend - like many - may not be true." In 1997 Oxford Health Plans saw $3.4 billion in market value disappear completely - in a single day. In 1998 Norm Payson arrived, the former family practitioner and now CEO of Oxford, was saddled with the task of "righting the ship." Over the next year Payson closed offices, laid off employees, and raised capital from private investors. The response from Wall Street was immediately encouraging, over the next two years stock prices climbed and market analysts declared "the turnaround is over." But as Stires points out, "there's only one problem with this feel - good scenario: It doesn't appear to be true." Oxford financed a large part of its turnaround through the release of excess reserves of medical claims and by reducing medical expenses by delaying payment to its providers. Stires examines how Oxford managed to get back on its feet, and if the health care provider has a stable future ahead.
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