U.S. health insurer Humana reported a better-than-expected quarterly profit along with raised its full-year profit forecast on Wednesday, as which signed up thousands more for its government-backed Medicare Advantage business.
Membership for Medicare Advantage’s individual plans, which provide insurance to the elderly along with disabled, rose 6 percent to 3 million within the first quarter. Employer or additional group-based Medicare Advantage plans added 14 percent more members.
The fast-growing along with profitable Medicare Advantage plans account for about a third of Medicare members, doing which an important growth area for private insurers.
“We experienced strong Medicare Advantage enrollment growth … with early positive indicators of medical utilization allowing us to raise guidance for the year,” Chief Financial Officer Brian Kane said.
The health insurance giant has been diversifying to move deeper into patient care along with drug retail, leading to a wave of consolidation within the sector.
Last week, Humana paired up with two private-equity firms to buy privately held Curo Health Services for about $1.4 billion, the group’s second such deal in 5 months.
Net income fell to $491 million, or $3.53 per share, within the quarter ended March 31, by $1.12 billion, or $7.49 per share, a year earlier.
Last year’s results included a gain related to its terminated merger agreement with Aetna Inc.
Excluding items, the company earned $3.36 per share, beating analysts’ average estimate of $3.19, according to Thomson Reuters I/B/E/S.
The company said its adjusted benefit expense ratio the percent of premiums spent on claims improved upon to 84.9 percent by 85.2 percent a year earlier.
Revenue rose nearly 4 percent to $14.28 billion.
The company at This specific point expects full-year adjusted earnings of $13.70 per share to $14.10 per share, compared with its previous forecast of $13.50 to $14.00 per share.
Humana’s shares, up 19 percent This specific year, were 1.6 percent higher in light premarket trading.