How did the top US health insurers do in the first quarter of 2016? And what role did Obamacare play in the earnings results? Here’s a quick snapshot:
Cigna Corp, which is being bought by Anthem Inc, reported a better-than-expected quarterly profit as more customers signed up for its Medicare Advantage business, boosting premiums. Memberships in Cigna’s government business, which sells Medicare and Medicaid plans, rose 10 percent in the first quarter. (Reuters, May 6)
Humana, saddled with the enormous costs from its tie-up with rival health insurer Aetna Inc., reported a 46 percent decline first-quarter profit, though it still topped most expectations. Revenue also fell slightly to $13.8 billion, thought that also edged out Wall Street projections. (CNBC, May 4)
Aetna Inc. raised its earnings forecast for the year after first-quarter profit topped analysts’ estimates, helped by rising premiums.The health insurer now expects 2016 earnings of $7.90 to $8.10 a share, excluding some items, up from a February forecast of at least $7.75. Aetna has added customers in the private Medicare Advantage program for the elderly, and is expanding its wager on the business with the planned acquisition of Humana Inc. That helped cushion a decline in commercial membership and a rise in medical costs. (Bloomberg, April 28)
Anthem’s first quarter earnings were better than expected as the company welcomed 1 million new customers across its businesses since the end of last year, including 184,000 who signed up for coverage on public exchanges under the Affordable Care Act. Anthem, which sells policies under the Blue Cross and Blue Shield brand in 14 states, expects to remain in those markets next year with the potential for expansion should its merger with Cigna be approved. (Forbes, April 27)
UnitedHealth Group boosted revenue in the first quarter, despite losses from participation in Affordable Care Act exchanges that are leading the company to exit those marketplaces in at least five states. Its first quarter revenue rose 25%, to $44.5 billion as compared to that three month period in 2015. Adjusted earnings jumped 17% to $1.81 per share, versus the first quarter of 2015, beating analysts estimates by nine cents.(USA Today, April 19)
What is Medicare Advantage?