Four more health insurers have released their earnings in the past week — and have tried to maintain a semblance of calm.
Aetna Inc. (NYSE:AET), one of the companies that released earnings, is acquiring Humana Inc. (NYSE:HUM).
Molina Healthcare Inc. (NYSE:MOH), a Medicaid carrier that had not been a big blip on the radar of agents and brokers interested in commercial major medical insurance is getting more attention because it hasn’t made a deal. The company seems to understand how to cover low-income and moderate-income people who enroll in commercial health insurance through the Patient Protection and Affordable Care Act (PPACA) public exchange system.
Cigna Corp. (NYSE:CI) is getting acquired by Anthem Inc. (NYSE:ANTM).
Health Net Inc. (NYSE:HNT) is getting acquired by Centene Corp. (NYSE:CNC).
Cigna and Health Net have stopped holding quarterly earnings calls while their deals are pending. But, overall, the companies are saying, operations look fine.
For more about what the companies said about their latest results, read on.
Aetna is reporting $732 million in net income for the latest quarter on $15 billion in revenue, up from $549 million in net income on $15 billion in revenue for the second quarter of 2014.
The company ended the quarter by providing or administering health coverage for 24 million people, up from 23 million a year earlier.
Enrollment in health account plans increased to 4.1 million, from 3.6 million. Enrollment in commercial plans increased 1.5 percent, to 20 million.
Medicare Advantage enrollment increased to 1.2 million, from 1.1 million, and Medicare supplement enrollment rose to 507,000 from 434,000.
Shawn Guertin said during the company’s conference call with securities analysts that the Aetna private exchange program serves about 190,000 enrollees. The company did not break out individual public exchange plan enrollment.
Guertin said the company has been increasing premiums for small groups and midsize groups and letting enrollment in those plans fall, to improve the performance of those blocks of business.
The company did create a separate presentation on the PPACA “three R’s” risk-management programs — the temporary reinsurance, temporary risk corridors and permanent risk-adjustment programs.
Aetna executives predicted that the effects of the programs on the company will be manageable, and that, if the risk corridors program works as hoped, the company could do better than expected.
Mark Bertolini, said the company will be adding new individual public exchange and off-exchange health products in 2016, and that it will be setting up a small-group private exchange in some markets in 2016.
Molina is reporting $39 million in net income for the latest quarter on $3.5 billion in revenue, compared with $7.8 million in net income on $2.3 billion in revenue for the second quarter of 2014.
The company ended the quarter providing or administering medical coverage for 3.4 million people, up from 2.3 million people a year earlier.
Enrollment in the company’s PPACA public exchange qualified health plans (QHPs) increased to 261,000 from 18,000.
Dr. Mario Molina, the company’s chief executive officer (CEO), talked during his company’s earnings call about why he would not talk about the mergers and acquisitions going on at other health insurers.
“My father used to say, ‘Shoemaker, mind thy last,’ and we have done so,” Molina said. “We have remained focused on growing our core businesses…We remain focused on our mission to serve low-income individuals that require government assistance.”
The company has been used to high claims and tight margins in the Medicaid market. Executives said that, from their point of view, exchange QHP claim costs look good.
Dr. Molina talked about another problem that might not be significant for other insurers: the financial problems facing the government in Puerto Rico.
Molina’s company now has Medicaid enrollees in Puerto Rico. “Puerto Rico pays our premiums weekly and is current with their payments,” Molina said. “We will continue to monitor the situation there.”
Cigna is reporting $588 million in shareholders’ net income for the latest quarter on $9.5 billion in revenue, compared with $573 million in shareholders’ net income on $8.7 billion in revenue for the second quarter of 2014.
The company ended the quarter providing or administering medical coverage for 15 million people, about 3.5 percent more than it was covering a year earlier.
Both commercial and government plan enrollment grew.
Health Net is reporting $58 million in net income for the latest quarter on $4.2 billion in revenue, compared with $121 million in net income on $3.4 billion in revenue for the second quarter of 2014.
The company ended the quarter providing or administering medical coverage for 6 million people, up from 5.9 people a year earlier.