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 The company, which has reduced its presence in the Obamacare
markets, raised its 2017 adjusted earnings forecast to $11.90 to
$12.00 per share, up from its previous expectation of earnings of
greater than $11.70.
Anthem said on Tuesday it would acquire America's 1st Choice, a
privately held for‐profit Medicare Advantage company, expanding its
presence in Florida.
Medicare Advantage, an alternative to the standard fee-for-service
Medicare in which private insurers manage health benefits, is the
fastest growing form of government healthcare.
Anthem's "solid beat & raise" third quarter is likely to quell
investor fears ahead of the quarter, which Leerink analysts expect
will bid up the stock.
Anthem's shares were up 4 percent at $203.53 in light premarket
trading on Wednesday.
Anthem's earnings come two days after a U.S. judge appeared
skeptical toward a request from several states that want him to
order the Trump administration to continue payments to health
insurers under Obamacare that help cover out-of-pocket medical
expenses for low-income Americans.
Earlier this month, Trump terminated the payments but has
alternately supported, and dismissed, an effort by Republican and
Democratic senators that would reinstate the subsidies for two
years.
Net income rose to $746.9 million, or $2.80 per share, in the third
quarter ended Sept. 30, from $617.8 million, or $2.30 per share, a
year earlier.
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Excluding items, the company earned $2.65 per share, ahead of
analysts expectation of $2.42 per share, according to Thomson
Reuters I/B/E/S.
Total revenue rose nearly 5 percent to $22.43 billion, above
analysts estimate of $22.05 billion.
Anthem's benefit expense ratio, a metric that measures an insurer's
expenditure on claims against the premiums it earns, came in at 87
percent, up from 85.5 percent in the year-ago period. The lower the
ratio, the better it is for insurers.
This increase was largely driven by the impact of the one year
waiver of the health insurance tax in 2017, the company said.
(Reporting by Ankur Banerjee in Bengaluru; Editing by Supriya Kurane)
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