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In the RegionMd. insurance chief upholds fine...

THE BALTIMORE SUN

In the Region

Md. insurance chief upholds fine against HMO for denying care

Maryland Insurance Commissioner Steven B. Larsen yesterday upheld his agency's largest fine against an HMO for denying medically necessary care - $125,000 imposed against Connecticut General Life Insurance. The fine, imposed in July, came after the insurer denied coverage for additional inpatient rehabilitation for a patient who had received skull surgery.

According to Larsen's ruling, Connecticut General challenged the law under which the Maryland Insurance Administration hears patient appeals over whether care is medically necessary, and has the medical file reviewed by independent doctors. Larsen ruled that federal law did not prevent Maryland from setting up the review system.

Larsen said Connecticut General has indicated it would appeal the ruling in court. There have been court tests of similar review systems in Texas and Illinois, producing contradictory rulings which may eventually be resolved by the U.S. Supreme Court, according to the insurance administration.

Connecticut General officials could not be reached for comment yesterday.

3 city cleaning companies to let 400 janitors unionize

Three of Baltimore's largest commercial cleaning contractors have agreed to allow about 400 Baltimore janitors to unionize, union officials said yesterday.

The agreement with My Cleaning Service Inc., United States Services Industries and Initial Contract Services will recognize the Service Employees International Union at various downtown buildings if a majority of the janitors who clean those offices fill out union cards.

The janitors, who had walked off the job to protest bad working conditions, are hoping the agreement paves the way to later negotiate for full-time hours and better wages and health benefits.

PSINet to forgo quarterly dividend

PSINet Inc., an Internet-service provider whose shares have fallen 99 percent in the past year, said it won't pay a quarterly dividend as it considers filing for bankruptcy or finding a buyer.

Its board did not declare a dividend yesterday on its Series D preferred shares, the company said in a statement.

PSINet, the company name on the Baltimore Ravens' stadium, said it is continuing to consider alternatives, including a bankruptcy reorganization, a sale or restructuring payments due bondholders and other creditors.

Antex Biologics loss grows to $1.6 million

Antex Biologics Inc. reported yesterday that its first-quarter net loss widened to $1.6 million from $1.2 million in the year-ago period as revenue fell and expenses increased.

But the Gaithersburg-based developer of vaccines said its per-share loss, spread out over significantly more shares than in the year-ago quarter, remained at 20 cents. The company had a weighted average of more than 11 million common shares outstanding in the first quarter, compared with 6.6 million in the 2000 first quarter.

Revenue was $47,865, compared with $129,763 in the year-ago quarter. Research and development costs grew to $1.1 million from $1 million a year ago, and general and administrative expenses rose to $630,994 from $433,198.

MICROS Systems lands 6 contracts

MICROS Systems Inc., a developer of high-tech, point-of-purchase computer systems, said yesterday that it has landed contracts with several well-known restaurants and hotels for its products. Amounts were not disclosed.

The Columbia-based company will install a system in Charlie Trotter's restaurants in the Chicago area. The Wine Spectator magazine recently named Trotter's the best restaurant in the country.

MICROS also will install its systems in Boston's Bull & Finch Pub - the inspiration for the hit TV series "Cheers" and now a Boston tourist attraction; two sister establishments, The Hampshire House and 75 Chestnut; and Paradise Island Atlantis resort in the Bahamas, and has a renewed contract with Panera, Inc., which operates 282 bakery-cafes.

Group 1 Software's profit rises 19% to 53 cents a share

Group 1 Software of Lanham yesterday reported a 19 percent gain in net income for the fourth quarter of 2001.

The company reported net income for the quarter of $3.7 million, or 53 cents a share, on revenue of $27 million. That compared with net income a year earlier of $3.1 million, or 45 cents a share, on total revenue of $25.5 million.

For the fiscal year, net income increased 42 percent to a record $8.8 million, or $1.28 per share, compared with $6.2 million or $1 per share in 2000. Group 1 reported a 14-percent increase in total revenue to $93.3 million, up from $81.8 million in 2000.

Southwest to extend flights to mystery city

Southwest Airlines Chairman and Chief Executive Herbert D. Kelleher said yesterday that carrier will expand service to a new city this fall.

He declined to identify the city, other than to say it is east of the Mississippi River - cities lobby furiously for Southwest service, hoping it will bring lower fares. An announcement should come within a week, Kelleher said.

In January, Southwest began flights to West Palm Beach, Fla. The airline has expanded its low-fare, low-cost strategy to the East Coast in the last several years, growing from a Western carrier to the seventh-largest U.S. airline. It is the largest carrier at Baltimore-Washington International Airport.

Elsewhere

U.S. farm loan delinquencies drop from 41% to 21%

Delinquency rates on government farm loans have fallen sharply, despite slumping crop prices, since 1966, because farmers risk being cut off from credit if they don't keep up their payments.

About 21 percent of the $8.7 billion in outstanding direct loans was delinquent as of September 2000, down from 41 percent in 1995, the General Accounting Office reported yesterday.

The delinquency rate on the department's $8 billion in guaranteed loans has held relatively steady at 3.5 percent since rules imposed by Congress in 1996. The rules prohibited farmers from getting new loans if they are delinquent on an existing loan or have debt forgiven.

Comair to sell more jets, lay off 400 nonstrikers

Comair said yesterday that it will lay off 400 more of its 2,000 nonstriking employees and sell an additional 20 jets because of a continuing strike by pilots of the regional airline.

Comair's management said the reductions will cut the company's daily losses from the strike to between $1.5 million and $2 million. So far, the pilots' strike has cost Comair and its parent, Delta Air Lines, $4 million in lost revenue a day, or a total of $208 million since the strike began March 26.

No new talks are scheduled between Comair and the Air Line Pilots Association, which represents its 1,350 pilots. The pilots voted overwhelmingly last week to reject a settlement proposal from the National Mediation Board, which had been mediating the contract talks.

Northwest labor pact adds $232 million in expenses

Northwest Airlines said its new labor contract with mechanics, cleaners and custodians will add $232 million in expenses this year.

The four-year contract signed May 4 provides increased wages and pension benefits, lump-sum retroactive payments and one-time pay adjustments for about 9,500 members of the Aircraft Mechanics Fraternal Association who work for Northwest.

In a filing with the Securities and Exchange Commission, Northwest said the contract will add $138 million to its expenses over the rest of the year plus $94 million in retroactive pay and benefits. In 2000, Northwest's paid out $3.6 billion in salaries, wages and benefits.

This column was compiled from reports by Sun staff writers, the Associated Press, Bloomberg News and Reuters.

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