Because many managed care health plans are provided by for-profit companies, their cost-control efforts created widespread perception that they were more interested in saving money than providing health care.

Analysts said that the results from both companies were impressive, given the poor market environment for the brokerage business in the second quarter, and reflected strong cost-control efforts at both companies.

Many anxious doctors - fearful of being squeezed by cost-control efforts - have decided to heal themselves by contracting out for management services.

He said strong seasonal volumes and cost-control efforts by Union Carbide also contributed to the strong results.

Despite other cost-control efforts and a shifting of more expenses to employees, these costs have been rising at more than 20 percent a year for many employers.

If the cost-control efforts of insurance companies reduce unnecessary or inappropriate care, "consumers generally would be better off," the Congressional Budget Office said.

The Bush administration has defended that decision in court and has endorsed similar cost-control efforts by other states.

In an environment of rapidly rising drug prices, they said, states' cost-control efforts were the leading factor.

The better-than-expected earnings resulted from cost-control efforts, not good news about new products, they argued.

The planned acquisition demonstrates how cost-control efforts already under way and the prospect of a new national health plan are propelling the rapid consolidation of the medical industry.