Kaiser Permanente is preparing to make a huge strategic leap beyond its gatekeeper HMO roots by rolling out an administrative services only (ASO) product offering to large employers. The Department of Managed Care in California is completing new regulations to set parameters on the growing discount health-card industry. Worries are mounting in California over the effect of 10 percent cuts in reimbursement for providers serving Medi-Cal enrollees. Meanwhile, Molina Healthcare is encouraged by a recent test over whether its Medicaid enrollees stayed in the health plan long enough for members and the plan to benefit from predictive modeling. The research disproved the hypotheses that Medicaid members' length of enrollment was too brief to justify predictive modeling.