PacifiCare Health Systems Inc., Santa Ana, Calif., has reached an agreement with the U.S. Office of Personnel Management (OPM), the U.S. Department of Justice and a private individual to settle disputes and a qui tam lawsuit under the False Claims Act regarding allegations of premium adjustments for the period 1990 through 1997, primarily related to contracts held by FHP International Corp. (FHP) health plans prior to PacifiCare's acquisition of FHP in 1997.The settlement, for which the company is fully reserved, requires PacifiCare to pay $88 million ($68 million upfront; $10 million in six months; and $10 million in 12 months, all inclusive of interest). In return, PacifiCare will receive payments from OPM amounting to about $15 million.
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