Anthem's first-quarter earnings jumped 23 percent thanks in part to a spike in Medicaid enrollment and it became the latest health insurer to raise its forecast for the year after breezing past the Wall Street's expectations.
Anthem's first-quarter earnings jumped 23 percent, helped in part by a spike in Medicaid enrollment, and the insurer became the latest in its sector to beat expectations and raise its forecast for the year.
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The nation's second largest health insurer said Wednesday that its Medicaid enrollment jumped 25 percent to 5.6 million people compared with last year's quarter. That helped push total enrollment up more than 4 percent and above 38 million people.
Medicaid is the state-federal program that covers the poor and those over 65. States hire insurers to administer the coverage, which has been growing as the federal health care overhaul expands coverage to millions of uninsured people.
Overall, Anthem earned $865.2 million, or $3.09 per share, in the quarter that ended March 31. That compares to $701 million, or $2.40 per share, last year.
Earnings adjusted for one-time items totaled $3.14, which trumped analyst expectations.
The average estimate of 14 analysts surveyed by Zacks Investment Research was for earnings of $2.69 per share.
Operating revenue, which excludes investment gains, rose nearly 7 percent to $18.85 billion.
Analysts expected $19.28 billion, according to Zacks.
The Indianapolis insurer runs Blue Cross-Blue Shield plans in several states and is a prominent player on the overhaul's public insurance exchanges, which allow customers to buy individual insurance with help from income-based tax credits or subsidies. It changed its name from WellPoint last year.
On Wednesday, Anthem joined competitors UnitedHealth and Aetna, among other insurers, who topped quarterly expectations and raised 2015 forecasts.
Health insurers are dealing with much less uncertainty this year compared with 2014. They're learning how to deal with additional fees from the health insurance overhaul as well as the new customers the law gives them through its coverage expansion. They're also facing less-severe cuts to the federally funded Medicare Advantage program, a key growth component.
Anthem now expects full-year, adjusted earnings of $9.90 per share, which compares to its previous forecast for greater than $9.70 per share.
Analysts forecast, on average, $9.79 per share, according to FactSet.
Anthem shares have climbed 23 percent since the beginning of the year. The stock has increased 62 percent in the last 12 months and, like the shares of other insurers, has set several new all-time high prices.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on ANTM at http://www.zacks.com/ap/ANTM
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