FORM 8-K/A-1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
July 13, 1998
FOHP, Inc.
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(Exact name of registrant as specified in its charter)
New Jersey 0-25944 22-3314813
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(State or other jurisdiction (Commission File (IRS Employer Identification
of incorporation) Number) Number)
3501 State Highway 66
Neptune, New Jersey 07753
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(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (732) 918-6700
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(Former name or former address, if changed since last report.)
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Item 4. Changes in Registrant's Certifying Accountant.
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On July 13, 1998, the Audit and Finance Committees (the "Committees")
of FOHP, Inc. (the "Company") approved the appointment of Deloitte & Touche LLP
("Deloitte") as the Company's independent accountants for the year ending
December 31, 1998. Deloitte replaces Ernst & Young LLP ("Ernst & Young") as the
Company's independent accountants. Ernst & Young was dismissed as the Company's
independent accountants as of July 13, 1998. The change of independent
accountants was made in connection with the acquisition by Foundation Health
Systems, Inc., a Delaware corporation formerly known as Health Systems
International, Inc. ("FHS"), of approximately 98% of the outstanding equity of
the Company. FHS currently engages Deloitte as its independent accountants. The
Committees and FHS determined that only one independent accounting firm should
be engaged by FHS and its subsidiaries so that there is a consistent and
efficient review of the individual and consolidated financial statements of FHS
and its subsidiaries, including the Company.
During the Company's two most recent fiscal years and the subsequent
interim period through July 13, 1998, the Company and Ernst & Young did not have
any disagreements over any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure.
In connection with Ernst & Young's audit of the Company's financial
statements for the year ended December 31, 1996, the Company received a modified
opinion from Ernst & Young. Ernst & Young issued the modified opinion because
First Option Health Plan of New Jersey, Inc. ("FOHP-NJ"), the principal
operating subsidiary of the Company, had incurred operating losses since
inception and had not met the statutory net worth requirements applicable to it
as set forth in the Certificate of Authority granted by the New Jersey
Departments of Banking and Insurance and Health and Senior Services to FOHP-NJ.
Ernst & Young believed that FOHP-NJ's recurring operating losses and its failure
to meet the statutory net worth requirements applicable to it raised substantial
doubt about the Company's ability to continue as a going concern. Ernst & Young
did not modify its opinion issued in connection with its audit of the Company's
financial statements for the year ended December 31, 1997, primarily because of
the infusion of additional capital by FHS into the Company during 1997 and FHS's
intention to infuse additional capital into the Company as needed.
A copy of this Amendment No. 1 to the Current Report on Form 8-K dated
July 13, 1998 has been delivered to Ernst & Young. Attached as Exhibit 1, is a
copy of Ernst & Young's letter to the Securities and Exchange Commission which
sets forth whether Ernst & Young agrees with the statements made by the Company
in this Amendment No. 1 to the Current Report on Form 8-K dated July 13, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FOHP, INC.
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(Registrant)
By: /s/DONALD PARISI
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Donald Parisi
Senior Vice President, Secretary
and General Counsel
Date: July 23, 1998
EXHIBIT 1
[LOGO] [ ] MetroPark [ ] Phone: 732 906-3200
99 Wood Avenue South
Iselin, New Jersey 08830-0471
July 23, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Gentlemen:
We have read Item 4 of Amendment No. 1 to the Form 8-K dated July 13, 1998, of
FOHP, Inc. and are in agreement with the statements contained in the first,
second and third paragraphs on page 2 therein. We have no basis to agree or
disagree with other statements of the registrant contained therein.
/s/Ernst & Young LLP
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Ernst & Young LLP
Ernst & Young LLP is a member of Ernst & Young International, Ltd.
