Health insurer Anthem Inc. said profit climbed 44 percent in the first quarter, boosted by customer increases in the company's commercial and Medicaid business lines and premium increases.
The Indianapolis-based company, which operates Blue Cross Blue Shield plans in more than a dozen states, on Wednesday morning posted profit of $1 billion, or $3.73 a share.
Excluding one-time items, profit was $4.68 a share, compared with $3.46 in the year-ago quarter—beating Wall Street estimates by 83 cents a share. Analysts had expected the company to earn $3.85 a share, according to figures compiled by Thomson Reuters. Analysts’ estimates typically exclude special items.
Revenue for the quarter was $22.5 billion, up 11 percent. Growth “reflected premium rate increases to cover overall costs across our businesses,” the company said.
“Our first quarter 2017 earnings represent a strong start to the year as membership and operating revenue came in above our expectations,” CEO Joseph Swedish said in a statement.
The company’s press release did not mention any new developments in its proposed $54 billion acquisition of rival insurer Cigna Corp. In January, a federal judge blocked the deal, saying it would hurt competition, but Anthem has yet to say it will abandon it.
Anthem said medical enrollment climbed 2.6 percent from a year ago. Commercial and specialty enrollment increased by 471,000 members. Medicaid enrollment grew by 8 percent, or 507,000, to about 6.6 million people. Medicare edged up by 53,000.
Overhead costs dropped slightly, the company said, driven by “efficiency initiatives” and a one-year waiver of the health insurance tax this year.
Anthem projected that profit for the year will be $10.37 a share, or $11.60 a share excluding unspecified “net unfavorable items." Operating revenue for the year was projected in the range of $88 billion to $89 billion.