Anthem merger partner reports dip in profit

Health insurer Cigna Corp. said fourth-quarter profit slipped 8.7 percent on higher sales, but attributed the profit dip to transaction costs associated with its pending $54 billion merger with Indianapolis-based Anthem Inc.

Connecticut-based Cigna posted profit Thursday of $426 million, or $1.64 a share for the quarter, down from $467 million or $1.77 a year ago.

 

Adjusted income from operations was $486 million, or $1.87 a share, compared to $375 million, or $1.80 a share for the quarter.

Revenue climbed 6.7 percent to $9.5 billion.

Analysts surveyed by Thomson Reuters were expecting earnings of $1.80 per share.

 

Revenue increased across the board, in commercial and government medical sales, behavioral care, dental, pharmacy and Medicare Part D.
 

Last month, the U.S. government suspended new enrollment in Cigna’s Medicare Advantage and prescription drug plans, saying the company had “widespread and systemic failures” that prevented the company from accessing medical services.

Cigna has said the suspension does not affect members currently enrolled in the plans, but did not offer further comment in the earnings release. The company said it will not hold a conference call on its earnings.

“Our pending combination with Anthem will further accelerate our strategy to improve quality, choice, and affordability in the marketplace,” CEO David M. Cordani said in a statement.

Shareholders for the two companies approved the merger in December, which would create the largest health insurer in the country. The deal is awaiting regulatory approval.