Medicaid insurer Centene's 3Q profit soars

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Associated Press

Posted on October 22, 2013 at 6:03 AM

NEWS: Centene Corp.'s third-quarter earnings soared compared to last year, when higher-than-expected medical costs from Kentucky swamped the Medicaid coverage provider.

DETAILS: The St. Louis company took a $63 million hit in last year's quarter because the premiums it collected in Kentucky didn't match the medical costs it incurred for coverage in that state. Centene wound up suing Kentucky over its contract to provide Medicaid coverage and left the state earlier this year.

Medicaid is the state and federally funded program that provides health coverage to poor and disabled people. States hire private insurers to administer the coverage.

NUMBERS: The insurer said Tuesday it earned $49.4 million, or 87 cents per share, in this year's quarter. That compares to $3.8 million, or 7 cents per share, last year. Revenue rose about 15 percent to $2.8 billion.

The insurer earned 88 cents per share not counting a charge attributed to its Kentucky loss.

Analysts expected, on average, earnings of 84 cents per share on about $2.67 billion in revenue, according to FactSet.

STOCK: Centene shares closed at $66.11 on Monday and have jumped about 60 percent so far this year.

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