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Aetna Reports Higher Net Income On Lower Revenue

By Allison Bell

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NU Online News Service, July 30, 2003, 5:21 p.m. EDT – Aetna Inc., Hartford, says moderation in pharmacy and medical cost increases and solid sales are helping it overcome the weakness of the U.S. economy.

The managed care company is reporting $138 million in net income for the quarter on $4.5 billion in revenue, compared with $108 million in net income on $5.1 billion in revenue for the second quarter of 2002.

The company ended the quarter providing or administering medical insurance for 13 million people, down from 14 million people a year earlier. But enrollment in indemnity plans, preferred provider plans and point-of-service plans was higher than it was at the end of the first quarter.

During the second quarter, new group sales “offset reductions in membership principally resulting from job reductions within certain accounts due to the continued weak economy,” Dr. John Rowe, Aetna’s chairman, says in a statement about the company’s results.

Average commercial premium revenue per insured commercial medical member fell 5.4%, to $238.