HMO Gets New Owners and New Name

Goodbye, HMO California. Hello, HealthMax?

HMO California--a loss-ridden health plan with 10,000 members--seeks success under new ownership and the new name, HealthMax America.

Founded by local doctors about 10 years ago, HMO California was acquired by health care giant Humana Inc. three years ago, then spun off as a company to a private doctors’ group last November.

Dr. David L. Tsoong, its new chief executive and an owner, says the HMO California name was “too generic.” He believes “HealthMax” reflects his aim of increasing benefits of managed care for small employers and their workers.

Tsoong, 50, is also set on making the loss-ridden plan profitable. He says it lost money as a part of Humana because it was too small to enjoy economies of scale.

He figures he can push the plan into the black by more than doubling its membership to 25,000 in a year. He plans to target small employer groups and individuals on Medicare.

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Barbara Marsh covers health care for The Times. She can be reached at (714) 966-7762 and at barbara.marsh@latimes.com