Anthem 3Q profit jumps 23%, helped by enrollment gains

Anthem Inc.’s third-quarter profit jumped 23%, and the Indianapolis-based insurer raised its 2019 forecast after attracting more customers covered by Medicare Advantage and Medicaid.

Anthem now expects adjusted earnings to be greater than $19.40 per share for the year. That’s a dime higher than the forecast it made in July.

Analysts expect, on average, $19.35 per share, according to FactSet.

Indianapolis-based Anthem Inc. covers about 41 million people, mostly through employer-sponsored health plans. But it also saw its enrollment in Medicare Advantage plans, which are privately run versions of the government’s Medicare program, jump 21%, to 1.2 million people in the quarter.

Its enrollment in state and federally run Medicaid programs rose 8%, to 7.3 million.

Overall, Anthem’s profit climbed to $1.18 billion in the quarter, up from $960 million in the same period of 2018. Earnings adjusted for one-time items came to $4.87 per share.

Excluding investment gains, operating revenue climbed 15%, to $26.44 billion.

The results surpassed Wall Street expectations. Analysts expected, on average, earnings of $4.84 per share on $25.41 billion in revenue.

Anthem also gave investors an initial glimpse into next year’s profit expectations.

CEO Gail Boudreaux told analysts Wednesday morning that the company expects core adjusted earnings to grow near the low end of its goal of 12% to 15%, which is similar to rival UnitedHealth Group Inc.’s estimate made last week.

Anthem will enter 2020 helped by its new pharmacy benefit manager, IngenioRx, which the company is starting with help from CVS Health Corp. Anthem expects to have all of its customers moved over to IngenioRx by Jan. 1.

Anthem shares edged up $1.75, to $262 each, in premarket trading Wednesday.

The stock has dropped almost 1% since the beginning of the year and is down roughly 6% in the last 12 months.