Centene Corp. — a health insurer that focuses on serving low and moderate-income people and Medicare enrollees — says it spent about $1.45 billion on COVID-19 care in the third quarter.
COVID-19 accounted for about 6% of the $23 billion Centene spent on care in the third quarter, about three times higher than COVID-19 spending in the previous quarter, according to company figures.
The third quarter started July 1 and ended Sept. 30.
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Jeff Schwaneke, Centene’s chief financial officer, said COVID-19 spending was much higher in the third quarter, even though a severe wave of cases hit places like Boston and New York City in the second quarter, because of the way medical billing works.
“There’s usually a 30- to 45-day delay between when the inpatient state happens and when we actually pay the dollars to the provider,” Schwaneke said.
So far this year, use of traditional care has been lower than usual, Schwaneke said.
The combination of the reduction in use of ordinary care and the new COVID-19 care use has led to total use of care being just slightly below the historical average, Schwaneke said.
Michael Neidorff, Centene’s chairman, said he would like to see more people wearing masks so that the United States can get the COVID-19 pandemic under control, and Centene can get its employees back to working in the company’s offices.
“We’ve announced to our employees not to expect to come back before the end of spring break, which is April of next year,” Neidorff said.
That a mask-wearing mentality helped Hong Kong and Japan get their COVID-19 outbreaks under control, Neidorff said, adding that If people in the United States would wear masks, the country could save 100,000 lives and get the country open more quickly.
Schwaneke, Neidorff and other Centene (NYSE:CNC) executives spoke during a conference call the company held to go over earnings for the third quarter with securities analysts.
Centene reported $565 million in net income for the third quarter on $29 billion in revenue, up from $95 million in net income on $19 billion in revenue for the third quarter of 2019.
The St. Louis-based company ended the quarter providing or administering health coverage for 25 million people, up from 15 million people a year earlier.
Here’s what happened to key types of enrollment between the third quarter of 2019 and the latest quarter:
- Medicare Plans: 1 million (up from 404,500)
- U.S. Commercial Major Medical Insurance: 2.7 million (up from 2.4 million)
- Affordable Care Act Public Exchange Plans: 2.2 million (up from 1.9 million)
- Medicaid and Similar Programs: 13 million (up from 8.7 million)
- International: 599,900 (up from 462,400)
The company said it has done things such as waiving COVID-19-related co-payments and deductibles for COVID-19 screening, testing and treatment for all Medicare, Medicaid and ACA exchange plan enrollees; donating 1 million meals a month for 12 months; waiving all cost-sharing for in-network primary care for Medicare Advantage plan enrollees for the rest of 2020; providing 10 extra working days of paid leave for support employees; and giving workers up to three months of paid leave and benefits for COVID-19 pandemic volunteering efforts.
Aflac is reporting $2.5 billion in net income for the third quarter on $5.7 billion in revenue, compared with $777 million in net income on $5.5 billion in revenue for the third quarter of 2019.
Net earnings at the Columbus, Georgia-based insurer were higher partly because recognized $1.4 billion in one-time income tax benefits, due to a change in U.S. tax regulations. Earnings before income tax, which leave out the effects of the tax rule change, increased to $1.2 billion, from $1 billion.