Centene reported first quarter profits of more than $1.1 billion as membership grew by more than 2 … [+]
Centene reported first quarter profits of more than $1 billion as membership grew by more than 2 million thanks to an increase in Obamacare and Medicaid enrollment, the health insurer said Tuesday.
Centene, which sells an array of government subsidized health insurance including Obamacare and Medicaid for low income Americans, said total managed care membership increased by more than 2 million members to 28.45 million, compared to 26.2 million at the end of the first quarter of 2022.
In particular, Centene’s enrollment in individual coverage under the Affordable Care Act, also known as Obamacare, grew what Centene calls its “commercial marketplace” business to more 3 million members from 2 million a year-ago. Meanwhile, total Medicaid enrollment Centene manages via contracts with states jumped by more than 1 million to more than 16.3 million.
Such growth helped Centene’s revenues jump 3% to $38.88 billion from $37.18 billion in the year-ago quarter. Net income was $1.13 billion in the first quarter compared to a $849 million in the first quarter of 2022.
“The (revenue) increase was driven by 52% membership growth in the Marketplace business due to strong product positioning and open enrollment results as well as overall market growth; and organic Medicaid growth, primarily due to the ongoing suspension of eligibility redeterminations,” the company said in its earnings report.
The Biden administration said earlier this year that an all-time record of more than 16 million Americans have signed up for 2023 healthcare coverage that began Jan. 1, 2023 via the more than 30 states that use the federal HealthCare.gov marketplace and 18 state-based marketplaces.
The solid earnings report figured in Centene management’s decision to increase its 2023 full year adjusted earnings per share guidance to “at least $6.40 driven by strong performance in its market leading Medicaid and Marketplace businesses,” the company said.
“Centene’s first quarter results were strong, reflective of continued positive momentum operationally and the beginning of another year of disciplined execution against our strategic framework,” Centene chief executive Sarah London said. “Our updated 2024 adjusted EPS target incorporates thoughtful recalibration of several factors, including our updated view of Medicaid redeterminations, our 2024 Medicare bid strategy, and high-impact investments in the business. From this baseline, we remain confident in our ability to deliver 12-15% long-term adjusted earnings compound annual growth in the back half of the decade.”
