Business digest

MEDICARE HMO RATES REVEALED: The federal agency that administers Medicare published its rates Friday for Medicare HMO reimbursements in 2003. The new pay schedule reflects a 2 percent increase over this year's rates. HMOs in Pinellas County, for instance, will receive $571.17 per member per month next year; in Pasco County, $613.45; Hillsborough, $564.10; and Hernando, $581.55. Citrus County has no Medicare HMOs. The American Association of Health Plans, which represents HMOs, immediately criticized the new rate schedule as being inadequate to meet rising health care costs.

ANDERSEN LOSES CLIENT: Merck & Co. dropped Arthur Andersen LLP, its auditor for the past 31 years, becoming the biggest company to abandon the accounting firm that reviewed the records of Enron Corp. Merck appointed PricewaterhouseCoopers as its outside auditor for 2002. A Merck spokesman would not comment on Andersen's role in the Enron scandal. Separately, Arthur Andersen agreed to pay $217-million to settle three lawsuits stemming from the 1999 collapse of the Baptist Foundation of Arizona, an investment group designed to raise money for Southern Baptist causes. A state lawsuit alleged that Andersen prepared financial statements that concealed huge losses that should have been red-flagged to alert investors. Three former BFA officials have pleaded guilty to fraud charges. The foundation's failure, the largest nonprofit bankruptcy in U.S. history, left 13,000 mostly elderly investors out $570-million. Andersen neither admitted nor denied wrongdoing in the settlement.

AUTOMAKER RENEWS OFFER: General Motors Corp. said it will resume offers of zero-percent financing on most new vehicles, and Ford Motor Co. said it would extend its no-interest finance program. GM had allowed its previous zero-percent financing plan to expire two months ago. Ford has continued to offer zero-percent financing. Cadillac, Saturn, Saab, Hummer, Chevrolet Corvette, GMC Envoy XL and all 2003 models are excluded from the new GM financing offer. Separately, GM said February sales edged up 0.4 percent from a year ago, as strong sales of its light trucks more than offset a 19.7 percent decline in sales of cars. Sales of Ford, Lincoln and Mercury cars tumbled 25 percent.

PILLOWTEX TO TRIM FORCE: Pillowtex Corp. plans to cut nearly 1,000 jobs as it closes a towel manufacturing plant in Georgia and scales back operations at an Alabama mill. Pillowtex disclosed the cutbacks Thursday as a federal court in Delaware approved its plan to emerge from bankruptcy proceedings. Pillowtex filed for Chapter 11 bankruptcy protection November 2000. The cutbacks are designed to save the company about $20-million a year. The company's brands include Cannon, Fieldcrest and Royal Velvet.

WALTER CEO ADDS TITLE: Don DeFosset, who took over as president and CEO of homebuilder Walter Industries Inc. in November 2000, has assumed the additional role of chairman. He replaces Donald Boyce, a board member who stepped in as interim chairman, president and CEO in August 2000 after turnaround artist Bob Burton quit four months into the job. Boyce will remain a board member of the Tampa company.

STATE FARM POSTS LOSS: State Farm said it lost $5-billion in 2001, as claims rose more than expected and the company's stock investments declined. The company's loss compared with net income of $400-million in 2000. State Farm's 2001 catastrophe losses were the third-biggest in the company's 80-year history, a spokesman said, behind only 1994 and 1992, the years of the Northridge, Calif., earthquake and Hurricane Andrew. State Farm's losses from the Sept. 11 terrorist attacks amounted to $40-million from auto and life insurance claims.

CARNIVAL CEO PAY DETAILED: Carnival Corp. chairman and chief executive Micky Arison realized a profit of $36.7-million from the exercise of stock options in fiscal 2001, according to a filing with the Securities and Exchange Commission. Arison earned a bonus of $1.7-million for the year ended Nov. 30, up from $1.5-million the previous year. His annual salary for the year was $501,000, unchanged from the previous year.

GENERAL DYNAMICS GETS ARMY PACT: A St. Petersburg unit of military contractor General Dynamics Corp. will provide ammunition to the Army for the fourth consecutive year. General Dynamics Ordnance and Tactical Systems will receive $72.9-million for 152,000 rounds of tank ammunition the Army uses for training. The deal is part of a multiyear contract. Headquartered in Falls Church, Va., General Dynamics had $12.1-billion of revenues in 2001.

MR. COFFEE CO-FOUNDER TAKES ACTION: A Naples man who co-founded the company that makes Mr. Coffee has filed a billion-dollar lawsuit against two firms who employed a broker suspected of cheating clients out of $277-million. Samuel Glazer's lawsuit in U.S. District Court accuses Lehman Brothers Inc. and SG Cowen Corp. of allowing Frank Gruttadauria to conduct the 15-year scam "through greed, carelessness or both." It accuses the firms of fraud, breach of fiduciary duty, negligence, breach of contract and civil conspiracy. Gruttadauria, 44, surrendered to authorities in Ohio last month after spending a month as a fugitive. He is being held without bond on a charge of making false statements to a financial institution.

© 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111

Contact the Times | Privacy Policy
Standard of Accuracy | Terms, Conditions & Copyright