Cigna’s Quarterly Earnings Up
Gains driven largely by global benefits operation after Cigna reported earlier that its business on the health law marketplaces was soft. News outlets also examine Humana and WellPoint's earnings.
The Wall Street Journal: Premiums, Fees Boost Cigna's Profit
Cigna again boosted its per-share adjusted earnings expectations for the year, to a range of $7.20 to $7.40. In May, the company had projected earnings of $7.05 to $7.35 a share. The health insurer said in February that it expected to lose money on health-care exchanges this year as enrollment numbers looked soft in the early going, particularly after a series of technical glitches in the federal HealthCare.gov site that slowed registration. In the most recent quarter, gains were driven in large part by the company's global supplemental benefits operations (Prior, 7/31).
The Wall Street Journal: Benefit Costs Pare Humana's Profit
The closely watched health insurer said its profit declined, as expected, because of its investments in health-care exchanges and state-based contracts, while higher costs associated with specialty hepatitis C treatments also weighed on results. Humana saw a large flow of consumers into its individual plans, including those sold through the health law's government marketplaces. It had 1.12 million enrollees in individual plans at the end of June, more than double the 478,000 it had a year earlier. Humana said it is requesting rate increases for health-law marketplace plans next year, a move it said wasn't unexpected because it previously warned that the enrollees' demographics could be worse—and thus costlier—than it originally projected when it set 2014 prices. Early drug claims signal that its later exchange enrollees were younger and healthier than those who signed up in the first quarter, the insurer said (Calia and Wilde Mathews, 7/30).
The Associated Press: WellPoint 2Q Tops Wall Street Expectations
WellPoint’s second-quarter profit fell 8.6 percent as expenses tied to changes in the nation’s health care laws climbed. It still beat Wall Street expectations, and the nation’s second-biggest health insurer raised its profit expectations for the year. Its shares fell in morning trading after initially rising (Chapman, 7/30).
The Wall Street Journal: WellPoint Lifts View Despite Profit Drop
WellPoint said it enrolled 769,000 people through the health-law marketplaces through the end of the second quarter, more than the approximately 600,000 it had projected. The demographics of the enrollees, including age, "continue to track well versus our expectations," with a "balanced risk pool," and the trends so far in the claims paid are "encouraging," said Joseph Swedish, the insurer's chief executive. However, WellPoint pointed to a drop in the small-group business that was steeper than it expected, reflecting faster-than-projected moves by employers to put workers into exchanges (Prior and Wilde Mathews, 7/30).