Stock Performance

Cigna Eases Investor Fears With Better Medical Cost, Membership

Cigna Corp. pleased Wall Street with its first-quarter 2022 financial results, touting a solid increase in commercial self-funded membership and a better-than-projected medical loss ratio (MLR) of 81.5%.

The insurer posted first-quarter 2022 net income of $1.18 billion ($3.68 per share) on revenue of $44.0 billion, up from net income of $1.16 billion ($3.30 per share) on revenue of $40.1 billion for the same period in 2021.

Cigna’s self-funded commercial membership rose 9% to 12.5 million through March 31, while insured commercial membership rose 2% to 2.2 million. In all, Cigna had 17.8 million medical members on March 31, 2022, up about 700,000 or 4% from Dec. 31, 2021, when it stood at 16.7 million.

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Aetna Is Star of the Show in CVS First-Quarter Financial Results

CVS Health Corp. posted robust financial results in the first quarter of this year, with revenues increasing by 11.2% to $76.8 billion. Wall Street praised the firm — particularly its Aetna health insurance division — for delivering strong results, and predicted the Caremark PBM would overcome disappointing results for the first quarter.

The integrated health care company’s quarterly adjusted operating income was $4.48 billion, increasing nearly 7% year-over-year from the first quarter of 2021.

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MCO Stock Performance, April 2022

Here’s how major health insurers’ stock performed in April 2022. UnitedHealth Group had the highest closing stock price among major commercial insurers as of April 29, 2022, at $508.55. Molina Healthcare, Inc. had the highest closing stock price among major Medicaid insurers at $313.45.

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UnitedHealth Sees Sunny 1Q, Says Deferred Care Impact Is MIA

UnitedHealth Group on April 14 reported first-quarter 2022 financial results that beat Wall Street expectations and led the health care behemoth to raise its full-year earnings guidance. The firm also offered insights into health care utilization trends that could serve as good news for the entire industry, as executives said they still have not seen evidence of members’ health conditions deteriorating because of care deferred during the pandemic.

Overall, care utilization in the quarter was roughly at baseline levels, Chief Financial Officer John Rex said during UnitedHealth’s conference call to discuss quarterly results. With the Omicron variant-driven surge early in the year, the company recorded about 40,000 COVID-19-related hospitalizations in January — “the highest of any month since the onset of the pandemic,” Rex said. But by March, hospitalizations declined to around 2,000 as the surge receded.

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MCO Stock Performance, March 2022

Here’s how major health insurers’ stock performed in March 2022. UnitedHealth Group had the highest closing stock price among major commercial insurers as of March 31, 2022, at $509.97. Molina Healthcare, Inc. had the highest closing stock price among major Medicaid insurers at $333.59.

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Startup Insurers’ 2021 Losses Add Up to ‘Staggering’ $2.5 Billion

As has been the case in previous quarters, all four of the newly public health insurance startups — Oscar Health, Inc., Bright Health Group, Inc., Clover Health Investments Corp. and Alignment Healthcare, Inc. — reported losses for the final three months of 2021. However, a look at both the fourth quarter and full year reveals that there were considerable differences among those companies in terms of the severity of their losses and the trajectory of their businesses.

“The four public startup health insurers lost $2.5 billion in 2021,” observes Ari Gottlieb, a principal at the consulting firm A2 Strategy Group, who calls that a “staggering amount of money.” Bright Health — which has Medicare Advantage, Affordable Care Act exchange and health care provider assets — was responsible for roughly half of that total loss among the quartet of insurers, losing just under $1.2 billion for the full year.

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MCO Stock Performance, February 2022

Here’s how major health insurers’ stock performed in February 2022. UnitedHealth Group had the highest closing stock price among major commercial insurers as of Feb. 28, 2022, at $475.87. Molina Healthcare, Inc. had the highest closing stock price among major Medicaid insurers at $306.87.

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Departing Neidorff Leaves Legacy of Major Growth at Centene

Centene Corp. on Feb. 24 revealed that CEO and Chairman Michael Neidorff took immediate medical leave. That means Neidorff may have served his last day at the helm of the company he built into a Medicaid managed care powerhouse, given the fact that he has already announced plans to retire later this year after 26 years on the job.

Effective immediately, an “expanded office of the chairman” will handle day-to-day management of Centene. That group includes Vice Chairman of the Board Sarah London, President and Chief Operating Officer Brent Layton, Chief Financial Officer Drew Asher and Chief Administrative Officer Shannon Bagley.

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If Direct Contracting Model Dies, MA Startups Could Suffer

Some Medicare Advantage insurers could take a hit if HHS decides to cancel an increasingly controversial care delivery model that allows participants to share risk and receive capitated payments for serving fee-for-service (FFS) Medicare beneficiaries.

The Global and Professional Direct Contracting (GPDC) model fully launched in April 2021, with 53 Direct Contracting Entities (DCEs) participating. Although most DCEs were provider-led organizations such as Iora Health, some MA insurers also threw their hats into the ring, including startup Clover Health; Humana Inc., under the CenterWell brand name; and Anthem, Inc., under the CareMore brand name.

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Centene’s MA Gains Swell Stock, But Could Have Downside

Centene Corp.’s shares rose following its fourth-quarter and full-year 2021 earnings release on Feb. 8, with the market seemingly impressed with the insurer’s Medicaid and Medicare Advantage membership gains. Still, one equities analyst sounded a note of skepticism about what large MA enrollment gains will mean for Centene’s margins.

“Outsized share gains in MA are typically a cautionary sign for margin,” Jefferies analyst David Windley wrote in a Feb. 8 note to investors. Centene’s management “is signaling flat ’22 MA margin, but is flat still optimistic with multiple competitors calling out CNC’s aggressive pricing?”

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