SOURCE: Stull, Stull & Brody

November 29, 2005 18:34 ET

Stull, Stull & Brody Announces Class Action Against Universal American Financial Corp.

NEW YORK, NY -- (MARKET WIRE) -- November 29, 2005 -- Notice is hereby given that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of all persons who acquired the publicly traded securities of Universal American Financial Corp. ("Universal American" or the "Company") (NASDAQ: UHCO) between February 16, 2005 and October 28, 2005, inclusive (the "Class Period"). Also included are all those who purchased in the secondary offering on or around June 16, 2005.

Stull, Stull & Brody has substantial experience representing employees who suffered losses from purchases of their employer's stock in their 401(k) plans. If you bought Universal American's stock through your Universal American retirement account and have information or would like to learn more about these claims, please contact us.

The complaint alleges defendants violated federal securities laws by issuing a series of materially false statements concerning the Company's medical loss ratio. The medical loss ratio is an expression of the relation of the cost of health care provided to premium income. An increase in the medical loss ratio means higher expenses relative to premium income, which in turn indicates that the Company is growing less profitable. The Company stated that the profitability of its Medicare Advantage business depended, to a significant degree, on the Company's ability to predict and effectively manage costs related to the provision of healthcare services. State regulations required that the Company monitor its medical loss ratio and the Company claimed to have systems in place that enabled it to do so. Defendants further stated that they were reversing a negative trend in the medical loss ratio.

On October 28, 2005, defendants announced a 22% year-over-year decline in net income resulting from higher medical care costs and expenses. On this news, the Company's share price dropped $7.50 to close at below $15.00 per share. During the Class Period, the Company and Company insiders sold Universal American shares for proceeds in excess of $200 million.

If you purchased Universal American common stock during the Class Period, you may request that the Court appoint you as lead plaintiff by January 23, 2006. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Stull, Stull & Brody, or other counsel of your choice, to serve as your counsel in this action. Stull, Stull & Brody has litigated many class actions for violations of securities laws in federal courts over the past 30 years and has obtained court approval of substantial settlements on numerous occasions. Stull, Stull & Brody maintains offices in both New York and Los Angeles.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Tzivia Brody, Esq. at Stull, Stull & Brody by e-mail at SSBNY@aol.com, by calling toll-free 1-800-337-4983, or by fax at 212/490-2022, or by writing to Stull, Stull & Brody, 6 East 45th Street, New York, NY 10017. You can also visit our website at www.ssbny.com.

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