My cousin works for Labcorp and recently I learned -- as some of you may know -- starting in 2007, UHC's exclusive agent for labwork will be Labcorp.

In many areas, it has as many/more locations as Qwest. (Not so where I live unfortunately.) I know that my monthly labwork runs close to $400 -- so obviously, that's a bill no one would want to be stuck with -- even for one month.

Check with UHC regarding your policy specifically.... I'm only repeating this so that no one gets burned. I personally haven't seen any notification yet, and my understanding is that the letters only recently went out to physicans, and that many -- especially the rheumies who are so high volume in terms and labwork and often have Qwest in office -- are boiling mad over this.

There is some question whether one can continue to use Qwest offices that send the labwork in the offices mentioned in the story below. They are part of a business Qwest recently acquired whose contracts end later than the original Qwest ones do.

Anyhow -- just a heads up....

Quest dives; LabCorp surges on UnitedHealth deal
By Carolyn Pritchard, MarketWatch
Last Update: 5:30 PM ET Oct 3, 2006

SAN FRANCISCO (MarketWatch) -- Quest Diagnostics Inc. shares plummeted 18% Tuesday after revealing it has lost its largest contract, as the exclusive national provider of laboratory services to an affiliate of health insurer UnitedHealth Group Inc., effective Jan. 1.

UnitedHealthcare awarded the exclusive contract to Laboratory Corp. of America Holdings for a 10-year term, sending its stock up as much as 11% to a fresh 52-week high of $72.39.

The shares ended the session higher by $1.36 at $66.57.

LabCorp said the UnitedHealthcare deal and associated business will generate additional revenue of more than $3 billion over the life of the agreement.

During the first three years, LabCorp will reimburse UnitedHealthcare up to $200 million for transition costs. The deal will result in incremental operating expenses of $14 million to $18 million in 2006, reducing its earnings by 6 cents to 8 cents a share.

LabCorp further said it expects 2007 revenue to be 11% to 13% higher than 2006 and forecast 2007 per-share earnings of $3.68 to $3.83 a share.

UnitedHealthcare accounts for about 7% of Quest Diagnostics' annual revenues, which totaled $5.5 billion in the full-year 2005 period. The company said it was unable to estimate the financial impact of losing the national agreement, but said on a conference call that it would provide further information when it issues 2007 guidance in January.

The Lyndhurst, N.J.-based company's labs in Cincinnati and in Lenexa, Kan. will continue to provide contracted services to UnitedHealthcare members until 2008; it also plans to keep competing for
UnitedHealthcare business in certain markets on a non-contracted basis.

Quest Diagnostics had been negotiating terms of a new national agreement with UnitedHealthcare for almost a year, Chairman and Chief Executive Surya Mohapatra said on the call. "But at the last minute, United changed direction and insisted that we sign an amendment to our existing contract that would have given them the ability to unilaterally dictate certain key terms over a period of up to eight years," he said.

"Accepting these terms would have been irresponsible for us," he said.
Quest Diagonostics said it that to the extent its volume changes as a result of losing the contract, it will adjust its cost structure "accordingly."