Aetna Profits Raise by 42% for 2nd Quarter – Membership Down and Profits Rise
Posted Jul 27 2010 10:59pm
Here’s yet one more carrier with increased profits and in the news Aetna stated they were going to cut unprofitable contracts with employers to attain greater profits. If you read further Aetna says they stand to make even more money with their projections. Membership is down but profits are up. The company spent 81.8 percent on medical care under the new 85% federal government rules upcoming.
They also had a short lived contract with Tri-Care until their bid was thrown out for conflict of interest and/or cheating, what ever you want to call it.
Also announced this week, some pharmacy benefit manager agreements with CVS that will stand to cut expenses and they Aetna unloads 800 employees over to Caremark. We have Blue Cross to announce tomorrow and it is expected they will have a good quarter as well. BD
LOS ANGELES — Health insurer Aetna Inc. said late Tuesday its second-quarter profit rose 42 percent, as the percentage of premiums the company spent on medical care fell versus a year ago.
The insurer said it earned $491 million, or $1.14 a share, in the three months ended June 30. That compares with net income of $346.6 million, or 77 cents a share, in the same period last year.
Aetna earned $450.2 million, or $1.05 a share, excluding one-time items. The company also raised its forecast for its 2010 operating earnings.
Total second-quarter revenue fell to $8.54 billion from $8.67 billion, in part due to a drop in premium revenue from lower commercial insured membership.
In the second quarter, the insurer spent 81.8 percent of its premium revenue on medical care, down from 86.8 percent. It spent 80.1 percent of its premium revenue on medical care for its commercial insurance business, down from 85.9 percent.