Several industry sources indicate UPS has decided to move about a quarter of its workers compensation business from Liberty Mutual to TPA Gallagher Bassett. The transition date is 1/1/2007.
UPS has been with Liberty from the beginning, and this represents a significant loss, as both claims administration and managed care will be moved to GB.
This is a major win for GB, and may mean that the big TPA has revised its business practices and cleaned up its act. GB has had a few embarassments in the marketplace of late, notably the Broward County School Board fiasco. UPS’ adviser is Aon, a consulting/brokerage house I have been less than impressed with in the past; perhaps Aon, which developed a managed care contracting and evaluation strategy as a direct result of its consulting work at a very large payer, has also upgraded its talent and output.
It appears the rationale was UPS’ desire to reduce the number of eggs per basket. It remains to be seen if the folks in brown have used the right approach and picked a decent basket.

Coventry’s First Health unit enjoyed an uptick in workers comp revenues in 2006 from Q1 to Q2, but revenues have been essentially flat over the last five quarters.
Here are the work comp division’s revenue numbers (in millions of dollars)
2005 Q2 $54
2005 Q3 $51
2005 Q4 $53
2006 Q1 $51
2006 Q2 $55
Overall, the entire FH division (work comp, commercial, and other lines) has seen declining revenues, from $224 million in Q2 2005 to $215 million in the most recent quarter. Note that the most recent 10-Q filing indicates revenues have gone up appreciably from the first half of 2005 to this year; this is partly because the acquisition did not close until January 28 2005, making revenue numbers from that quarter artificially low.
More on First Health is here.

In the “we could not make this stuff up” category, former Ohio coin dealer/money manager Tom Noe (!) is set to be sentenced on September 12 for funneling illegal campaign contributions to the Bush re-election campaign . Noe is likely to spend upwards of two years in prison, and perhaps a lot “upwards”. The funds totaled $42,000, and helped Noe attain the coveted “Pioneer” status in the Bush campaign.
The bad news won’t end there for Noe; several weeks after his sentencing he will begin defending himself against separate charges filed by the state of Ohio relating to his alleged theft from the reserves of Ohio’s Bureau of Workers Compensation. For those who have not been following Noe’s transgressions, be advised, the man was pretty busy.