Today, 11:14 AM
- Major health insurers in some states are proposing rate increases of as much as 51% for plans sold under the federal health law, according to a WSJ analysis, setting the stage for an intense debate over the law’s impact.
- All the insurers cite high medical costs incurred by people newly enrolled under the Affordable Care Act, saying their proposed rates reflect the revenue they need to pay claims now that they have had time to analyze their experience with the law’s requirement that they offer the same rates to everyone regardless of medical history.
- Some insurers are trying to catch up with the impact of expensive drugs such as Sovaldi, foreseeing significant pent-up demand from the newly enrolled, says a fellow at the Society of Actuaries.
- Relevant tickers: IHF, HNT, UNH, MOH, CNC, UAM, AET, CI, HUM, HCA, WCG, GTS, EMCI, MGLN
Tue, Apr. 28, 6:54 AM
- Centene (CNC -3.9%) Q1 results: Revenues: $5,131M (+48.3%); COGS: $402M (+66.1%); SG&A: $403M (+36.1%); Operating Income: $129M (+84.3%); Net Income: $64M (+88.2%); EPS: $0.52 (+79.3%); Quick Assets: $1,666M (+3.5%).
- Health Benefits Ratio: 89.8% (+0.6%).
- Total Membership: 4,401,700 (+44.4%); Medicaid: 3,133,900 (+44.5%).
- 2015 Guidance: Premium and service revenues: $20,500M - 21,000M; EPS: $2.60 - 2.72; Health Benefits Ratio: 89.2 - 89.6%; G&A expense ratio: 8.0 - 8.4%; effective tax rate: 48.0 - 50.0%.
Tue, Apr. 28, 6:04 AM
Mon, Apr. 27, 5:30 PM
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Thu, Mar. 19, 10:34 AM
- According to Bloomberg, major providers of Medicare coverage like Humana (HUM +0.9%), WellCare (WCG +0.6%) and Centene (CNC +1.4%) are high on the acquisition radar of large insurers who have relatively modest exposure to the rapidly growing Obamacare-stoked space. Likely suitors would be Aetna (AET +1.3%) and Anthem (ANTM +0.3%).
- There hasn't been much M&A activity among health insurers due to the uncertainties surrounding the implementation of the Patient Protection and Affordable Care Act. Now that its implications are better understood, the number of deals should perk up.
- No bargains are out there, though. S&P's index of health insurers galloped 57% last year. The current valuations for Humana, WellCare and Centene are $26.9B, $4.1B and $8.3B, respectively, all at record levels since at least 2007.
- Anthem CFO Wayne DeVeydt says his firm will continue to make smaller deals although a larger purchase is not out of the question. Other firms declined to comment.
- Leerink Partners analyst Ana Gupte says a likely scenario is consolidation among the five largest health insurers: UnitedHealth Group (UNH +0.8%), Anthem, Aetna, Cigna (CI +0.6%) and Humana.
- Aging baby boomers, born between 1946 and 1964, are driving the increase in Medicare enrollment. Membership is expected to rise to 68.4M in 2023, up more than 25% from this year's 54.4M. Medicaid is projected to add 9.3M people over the same time frame.
Wed, Mar. 4, 12:11 PM
- Hospitals rally on comments from Supreme Court Justice Anthony Kennedy, often a swing vote in important cases. He says there is a powerful point to the Obama administration's argument that the Affordable Care Act would fall apart if the subsidies were ruled invalid.
- The Court is currently hearing arguments in the case King v. Burwell, which challenges federal subsidies in states that did not create their own health insurance exchanges. Its final decision will not be announced until June, though.
- Hospitals and health insurers have the most at stake. They have benefited greatly since the law was signed in 2010. To date, 11.4M Americans have signed up for coverage in 2015, giving both groups more paying customers and potentially cutting the number of non-paying emergency room visits. If the subsidies were ruled invalid then many people would drop coverage due to the higher cost.
- Related tickers: (HCA +6.2%)(THC +5.4%)(UHS +2.6%)(CYH +5.4%)(LPNT +3.3%)(SEM -0.9%)(SSY)(HUM +0.1%)(CI -0.4%)(CNC)(MOH +0.3%)(ANTM +0.5%)(UNH +0.3%)(MGLN +0.3%)(WCG +0.3%)
Tue, Feb. 3, 10:11 AM
- Centene (CNC -0.1%) Q4 results: Revenues: $4,725M (+61.2%); COGS: $345M (+219.4%); SG&A: $364M (+42.2%); Operating Income: $194M (+128.2%); Net Income: $106M (+120.8%); EPS: $1.74 (+107.1%); CF Ops:$369M.
- FY2014 results: Revenues: $16,560M (+52.4%); COGS: $1,280M (+291.4%); SG&A: $1314M (+41.1%); Operating Income: $464M (+67.5%); Net Income: $268M (+66.5%); EPS: $4.45 (+55.1%); Quick Assets: $1564M (60.6%); CF Ops: $1,223M (+220.2%).
- Health Benefits Ratio: 89.3% (+1.4%); FY2014: 89.3% (+0.8%).
- Total Membership: 4,060,900 (+41.0%); Medicaid: 2,754,900 (+34.1%).
- 2015 Guidance: Premium and service revenues: $20,300M - 20,800M; EPS: $5.05 - 5.35; Health Benefits Ratio: 89.2 - 89.6%; G&A expense ratio: 8.0 - 8.4%; effective tax rate: 48.0 - 50.0%.
Tue, Feb. 3, 6:02 AM
Mon, Feb. 2, 5:30 PM
Wed, Jan. 28, 4:03 PM
- A study done by researchers from New York and Columbia Universities found that premiums were slightly higher for policies offered on state-run health exchanges where there were higher numbers of competitors, precisely the opposite effect that supposedly characterizes more intense competition.
- Overall, average monthly premiums were $5.71 higher per additional insurer (p<0.001). In addition, average monthly premiums were $3.18 higher per additional insurer for identical plans offered.
- The analysis focused on the prices for each unique insurance plan offered on the exchanges in each geographic rating area. The number of rating areas varied widely in the 34 states examined, from only one in NJ, NH and DE to 67 in FL.
- The authors acknowledge that the higher premiums may be due to higher cost areas (urban vs rural) where more insurers are located rather than a lack of competition.
- Related tickers: (NYSE:AFL) (NYSE:AIG) (NYSE:AET) (NYSE:CI) (NYSE:CNC) (NYSE:UNH) (NYSE:ANTM) (NYSE:MOH) (NYSE:HNT) (NYSE:HUM) (NYSE:WCG) (NASDAQ:MGLN)
Mon, Jan. 26, 12:48 PM
- Centene (CNC +1.3%) acquires Eugene-based Agate Resources, a diversified holding company that offers a variety of healthcare products and services to Oregon residents.
- Chairman and CEO Michael F. Neidorff says, "We view the Oregon CCO (coordinated care organization) model as consistent with our philosophy that healthcare is best delivered locally. Agate has demonstrated success working closely with providers and key community stakeholders and we are committed to maintaining that approach in the future."
- The transaction, expected to close in Q3, will be accretive to earnings in the first year following the close. Financial terms are undisclosed.
Dec. 12, 2014, 7:45 AM| Comment!
Oct. 28, 2014, 10:30 AM
- Centene (CNC +1.8%) Q3 results ($M): Revenues: 4,351.9 (+55.7%); Premiums: 3,780.3 (+44.6%); Services: 378.8 (+236.7%); Medical Costs: 3,390.1 (+47.8%); Operating Expenses: 4,243,9 (+56.5%); Operating Income: 107.9 (+28.5%); Net Income: 79.2 (+62.0%); EPS: 1.36 (+56.3%); Quick Assets: 1,583.0 (+52.5%); CF Ops: 441.8.
- Health Benefits Ratio: 89.7% (+2.2%).
- Total Membership: 3,705,300 (+41.8%); Medicaid: 2,578,300 (+32.0%).
- 2014 Guidance: Premium and service revenues: $15.3B - 15.8B from $15.0B - 15.5B; EPS: $4.35 - 4.50 from $3.70 - 3.90; Health Benefits Ratio: 88.9 - 89.4% from 88.7 - 89.2%; G&A expense ratio: 8.2 - 8.6% from 8.5 - 9.0%; effective tax rate: 40 - 42% from 49.5 - 50.5%.
Oct. 28, 2014, 6:23 AM
Oct. 27, 2014, 5:30 PM
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Oct. 19, 2014, 5:27 PM
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