Admar Contract With N.Y. Life Reaps $100,000

The Admar Group Inc. said it has earned about $100,000 so far on a contract with a large New York insurance company to negotiate and manage discounted hospital fees on its behalf.

The Santa Ana developer and marketer of managed health care programs said Wednesday that its open-ended deal with New York Life Insurance Co., signed last July, has led to decreases in hospital costs for about 200,000 New York Life members. The company did not specify the cost savings New York Life incurred because of the contract.

“So far, it shows that it has been achieving what we wanted it to do,” said Admar Group spokesman John Gray. “It’s been very successful.”

Gray said Admar Group manages, markets and negotiates discounted fees with hospitals around the nation for New York Life. Admar Group earns a percentage of New York Life’s savings from its hospital contracts based on Admar Group’s performance, Gray said.

Nationwide, Admar Group has contracts with 1,400 hospitals and 84 insurance companies, covering a total of about 7.2 million members in 38 states.

Patients who are members of New York Life’s Med$elect program still pay 20% of medical costs under the contract, but since the total costs are held down, their share is smaller than what the average patient pays, Gray said.

Admar Group stock was unchanged on the Nasdaq market, closing at $2.0625 a share on Wednesday.

The Admar Group

at a Glance

* Headquarters: Santa Ana

* Founder and CEO: Richard Toral

* Employees: 266

* In Orange County: 225

* Business: Develops and administers managed health care programs

* Second-quarter earnings: $132,000, or 2 cents per share, on revenue of $4.6 million

Source: The Admar Group; Researched by JANICE L. JONES / Los Angeles Times