Gail Boudreaux, Anthem’s chief executive officer, told investors Wednesday that the company spent about $500 million on COVID-19-related diagnostic services medical care in the second quarter, and about $2.5 billion on trying to help people overcome the effects of the COVID-19 lockdown.
The Indianapolis-based health insurer suspended the usual co-payments and other out-of-pocket costs for COVID-19 testing and some other procedures.
The company gave customers a premium credit equal to 10% to 15% of the monthly premium for major medical insurance, and premium credit equal to 50% of the monthly premium for dental insurance.
Anthem is also providing extra support for providers, including $10 per visit extra for personal protective equipment for dentists seeing enrollees in the company’s dental plans.
Medical spending seems to have increased to about 90% of the expected levels in June, from about 80% in May, and just 60% in April.
But profits doubled, in part because of COVID-19-related decisions by providers and patients to postpone elective procedures, both to conserve health care system capacity and to keep providers and patients from making each other sick.
Boudreaux noted that the rest of the year could look different from the second quarter.
“Looking ahead, we recognize there is much unknown regarding the magnitude and duration of this pandemic given the recent resurgence in COVID-19 cases across the country,” Boudreaux said, during a conference call Anthem organized to go over its latest earnings.
But, if a COVID-19 rebound continues to create unusually low medical spending levels, then Anthem will “certainly take appropriate actions to help address whatever imbalances exist,” John Gallina, Anthem’s chief financial officer, said during the call.
- Links to Anthem earnings resources are available here.
- An earlier article about Anthem’s earnings is available here.
Anthem organized the call to go over its earnings for the second quarter with securities analysts. The company has posted a recording of the call on its website
Anthem is reporting $2.3 billion in net income for the second quarter on $29 billion in revenue, compared with $1.1 billion in net income on $25 billion in revenue for the second quarter of 2019.
Anthem has about $4.1 billion of cash and highly liquid investments at the top level, Gallina said.
“With liquidity concerns not as prevalent as they were earlier in the year, we have resumed our share repurchase program and continue to expect to repurchase greater than $1.5 billion of shares for the year,” Gallina said.