Centene Corporation Reports 2016 Third Quarter Results

ST. LOUIS, Oct. 25, 2016

For the third quarter of 2016, we reported diluted earnings per share (EPS) of $0.84 and adjusted diluted EPS (Adjusted diluted EPS) of $1.11 when excluding Health Net acquisition related expenses and amortization of acquired intangible assets.  The third quarter of 2016 includes a $0.05 diluted EPS charge related to a revised reconciliation of the 2015 risk adjustment in Arizona.  During the third quarter, we received information from the Centers for Medicare and Medicaid Services (CMS) that some of the participants in the Arizona risk adjustment program were unable to pay the amounts owed to the Federal government associated with the 2015 risk adjustment reconciliation.  As a result, the uncollected risk adjustment was pro-rated to all insurers in the market.  Accordingly, we recorded a charge of $0.05 per diluted share recognizing our portion of the risk adjustment that will not be collected, which reduces the $0.19 diluted EPS benefit recorded in the second quarter.  A summary of diluted EPS is highlighted below:

GAAP diluted EPS	$	0.84
Health Net acquisition related expenses	0.12 ARIVA.DE Börsen-Geflüster Werbung Weiter abwärts? Kurzfristig positionieren in Centene Corp. VM55KM Ask: 1,49 Hebel: 5,68 mit moderatem Hebel Zum Produkt Vontobel Den Basisprospekt sowie die Endgültigen Bedingungen und die Basisinformationsblätter erhalten Sie hier: VM55KM,. Beachten Sie auch die weiteren Hinweise zu dieser Werbung. Der Emittent ist berechtigt, Wertpapiere mit open end-Laufzeit zu kündigen. Kurse Centene Corp. 74,00 $ -2,22%
Amortization of acquired intangible assets	0.15
Adjusted diluted EPS	1.11
2015 risk adjustment charge	0.05
Total	$	1.16

During the third quarter of 2016, we continued to make progress on resolving the issues associated with the Health Net premium deficiency reserve.  Specifically, we took the following actions:

• We reduced our estimate of the costs associated with the substance abuse claims from $50 million to $35 million for the period from March 24, 2016 through December 31, 2016. We continue to review substance abuse claim submissions and have lowered our estimate based on our experience through the third quarter. This adjustment had no impact on earnings.
• As previously disclosed, we finalized our 2017 product design and premium rate filing with the California Department of Insurance associated with the individual preferred provider organization (PPO) and exclusive provider organization products. We believe the final product design and rate adjustments will attract a balanced mix of membership to ensure the product is competitive. Additionally, we continue to identify medical management and network initiatives to further improve performance.
• We will exit the Arizona individual PPO business, effective January 1, 2017, which represents approximately $32 million of the $70 million 2016 Arizona individual premium deficiency reserve. Additionally, we will be the only carrier in Maricopa County and will continue our presence in Pima County for 2017. For 2017, based on our product designs and rate increases, we expect the Arizona Health Insurance Marketplace to operate within our normal marketplace margins.
• We have taken various rate and product design actions in the small group business and continue to expect our Medicare and Arizona Medicaid business to be profitable in 2017.

As a result of the above actions, we believe we have resolved the issues associated with the premium deficiency reserve for 2017.

In summary, the 2016 third quarter results were as follows:

Michael F. Neidorff, Centene's Chairman and Chief Executive Officer, stated, "We remain focused on successfully integrating Health Net and positioning Centene to continue its track record of achieving profitable growth."

Third Quarter Highlights

• September 30, 2016 managed care membership of 11.4 million, an increase of 6.6 million members, or 137% compared to the third quarter of 2015.
• Total revenues for the third quarter of 2016 of $10.8 billion, representing 86% growth compared to the third quarter of 2015.
• Health benefits ratio of 87.0% for the third quarter of 2016, compared to 89.0% in the third quarter of 2015.
• General and administrative expense ratio of 9.2%, or 9.1% excluding Health Net acquisition related expenses for the third quarter of 2016, compared to 8.4% in the third quarter of 2015.
• Operating cash flow of $480 million for the third quarter of 2016, or 3.3x net earnings.
• Diluted EPS for the third quarter of 2016 of $0.84, or $1.11 of Adjusted diluted EPS. Both third quarter amounts included a charge of $0.05 associated with a revised reconciliation of the 2015 risk adjustment. In comparison, diluted EPS for the third quarter of 2015 was $0.75, or $0.87 Adjusted diluted EPS.

Other Events

• In October 2016, our subsidiary, Home State Health, was selected to provide managed care services to MO HealthNet Managed Care beneficiaries. Under the new contract, Home State Health expects to serve MO HealthNet Managed Care beneficiaries in all 114 counties in Missouri. The contract is expected to commence May 1, 2017, pending regulatory approval.
•  In September 2016, the Alabama legislature approved the funding needed to create its regional care organization (RCO) structure. Our subsidiary, AHA Administrative Services, has contracted with five nonprofit RCOs in Alabama to provide management services. Operations are expected to commence July 1, 2017.
•  In August 2016, our Pennsylvania subsidiary, Pennsylvania Health & Wellness, was selected by the department of Human Services and Aging to serve enrollees in the Community HealthChoices program statewide. Expected contract commencement dates vary by zone, starting July 2017, and will be fully implemented by January 2019, pending regulatory approval.

Accreditations & Awards

• In October 2016, our Kansas subsidiary, Sunflower Health Plan, received Accreditation with a Commendable status from the National Committee for Quality Assurance.
• In August 2016, our subsidiaries, Envolve, Inc. and Envolve PeopleCare received honors at this year's National Health Information Awards. Envolve, Inc. received the merit award for the pamphlet Brush with Wisdom, while Envolve PeopleCare's Raising Well campaign won gold in the Health Information Program category.

Membership

The following table sets forth the Company's membership by state for its managed care organizations:

	September 30,
	2016			2015
Arizona	601,500			223,600
Arkansas	57,700			40,900
California	3,004,500			183,900
Florida	732,700			486,500
Georgia	498,000			406,700
Illinois	236,700			211,300
Indiana	289,600			276,700
Kansas	145,100			137,500
Louisiana	455,600			358,800
Massachusetts	45,300			63,700
Michigan	2,100			6,600
Minnesota	9,400			9,400
Mississippi	313,900			301,000
Missouri	104,700			88,400
New Hampshire	78,400			71,900
New Mexico	7,100			— Werbung Mehr Nachrichten zur Centene Corp. Aktie kostenlos abonnieren E-Mail-Adresse Bitte überprüfe deine die E-Mail-Adresse. Benachrichtigungen von ARIVA.DE (Mit der Bestellung akzeptierst du die Datenschutzhinweise) -1 Vielen Dank, dass du dich für unseren Newsletter angemeldet hast. Du erhältst in Kürze eine E-Mail mit einem Aktivierungslink. Hinweis: ARIVA.DE veröffentlicht in dieser Rubrik Analysen, Kolumnen und Nachrichten aus verschiedenen Quellen. Die ARIVA.DE AG ist nicht verantwortlich für Inhalte, die erkennbar von Dritten in den „News“-Bereich dieser Webseite eingestellt worden sind, und macht sich diese nicht zu Eigen. Diese Inhalte sind insbesondere durch eine entsprechende „von“-Kennzeichnung unterhalb der Artikelüberschrift und/oder durch den Link „Um den vollständigen Artikel zu lesen, klicken Sie bitte hier.“ erkennbar; verantwortlich für diese Inhalte ist allein der genannte Dritte. Andere Nutzer interessierten sich auch für folgende News 09:44 - PR Newswire Datang Intnl Pwr Gen - 2023 Annual Report 08:29 - PR Newswire Samson Rock Capital LLP - Form 8.3 - Shanta Gold Ltd 02:00 - PR Newswire BlackRock Income and Growth Investment Trust Plc - Total Voting Rights Sehen Sie sich dieses Unternehmen an:    Foto: andreas160578 - Pixabay Rasanter Aufstieg, Branchenrevolution und Jahresumsatz von 50 Mio. $ weiterlesen» Anzeige wo-site-teaser-box-16764_site-teaser-box_2024-04-26_09%253A00%253A00_2024-04-27_09%253A00%253A59