OmniCare Health Plan will remain in business following a decision of a Michigan judge. The judge approved a financial plan that will allow the HMO to repay doctors, hospitals, and other providers a fraction of what they were originally owed.

The new plan allows creditors to choose between two payment plans: an immediate sum, or investing in the HMO while it converts to a for-profit status which gives creditors the chance to collect more money from OmniCare. The ruling also calls for the termination of OmniCare's management contract with United American Health Care and the relocation of office space they share. These moves are expected to save the health plan money.

OmniCare Health Plan, which has been in rehabilitation under the Michigan Office of Financial and Insurance Services (OFIS) since July 2001, should not be liquidated, according to OFIS Commissioner Frank M. Fitzgerald. Despite the fact that OmniCare owes doctors and the Detroit Medical Center more than $92 million, it has turned a profit ever since it has been in receivership, says Fitzgerald.