Health Systems Purchases Stake in New Jersey Firm

Health Systems International Inc., a Woodland Hills-based managed-care company, said it will pay $30 million to buy a 40% stake in First Option Health Plan of Red Bank, N.J.

Health Systems also acquired the option to buy another 20% of First Option.

First Option is owned by doctors and hospitals and has 298,000 members throughout New Jersey. Its 1995 revenues were $111.4 million.

The move followed Health Systems’ acquisition of M.D. Health Plan in Connecticut and Greater Atlantic in Philadelphia, and an announcement last month that Health Systems would combine with Foundation Health Corp. in a $1.27-billion stock swap to create the nation’s fourth-largest managed-care company.

The purchase of the First Option stake is part of the company’s larger plans to expand in the Northeast, the company said.