Bruce Japsen Senior Contributor Jul 28, 2020,09:04am EDT
Health insurer
Centene is seeing a boost in Medicaid enrollment as unemployment rises amid the
spread of the coronavirus strain Covid-19 though Americans are signing up to
such coverage at a slower pace than the company originally projected.
Centene Tuesday
said its overall managed care membership in the second quarter
of this year rose nearly 64%, or 9.6 million members, compared to June 30, 2019
to 24.6 million total members. Of that, Centene’s total Medicaid enrollment
increased to 12.5 million in the second quarter compared to nearly 8.5 million
in the year-ago period.
Though Centene is
also a larger company thanks to acquisitions, the health insurer is expecting a
continuing enrollment boost in Americans signing up for Medicaid, the health
insurance for low income Americans it manages via contracts with states.
Centene, which bought WellCare Health Plans earlier this year, is now a
national health plan providing benefits to 1 in 15 Americans and is the largest
provider of individual coverage known as Obamacare under the Affordable Care
Act.
Earlier this
year, Centene said it expects the spread of Covid-19 to boost
Medicaid and Obamacare enrollment in the coming months and increase 2020
revenue by $4 billion. On Tuesday, Centene reduced its 2020 revenue projection
by $500 million amid the volatile rate of infections in certain markets across
the country.
“We still expect to
add $3.5 billion in Covid driven revenue,” Centene chairman and
CEO Michael Neidorff told
analysts on a call Tuesday morning to discuss earnings. “It is increasingly
clear we are going to be living with this pandemic for some time.”
In the second
quarter, Centene’s total revenue jumped 51% to $27.7 billion from $18.4 billion
in the year ago period. Meanwhile, Centene’s net income more than doubled to
$1.2 billion, or $2.05 per share, in the three months ended June 30, compared
to $495 million, or $1.18, in the year-ago period.
"Looking
ahead, while we expect the national economic trajectory to remain choppy as we
move through the second half of the year, we believe that the return of
utilization by our members seeking treatments will be regionally driven,”
Neidorff said in a statement accompanying the earnings report. “We continue to
provide the highest quality of care to our members during this critical time
and are well-positioned to respond quickly to evolving dynamics as we execute
on our growth strategy. We are further supported by the strength of our balance
sheet and solid financial position."
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