Anthem underwhelms Wall Street with 2022 forecast

Indianapolis-based Anthem Inc. is starting 2022 with lower expectations than Wall Street for how the year will play out.

The Blue Cross-Blue Shield health insurer on Wednesday reported its fourth-quarter and 2021 financial results, and laid out earnings, revenue and enrollment projections for this year that all fell short of average analyst expectations.

Shares in Anthem fell 3% in premarket trading while broader indexes climbed. Shares were down 2.1% at mid-morning, to $430.04 each. The stock, however, has climbed about 40% over the past year.

The health insurer expects enrollment to grow, especially in Medicare Advantage, the privately run version of the federal government’s coverage program. But it also anticipates some increased costs at least initially as the new customers start using their coverage.

Anthem said it expects full-year adjusted earnings to be greater than $28.25 per share on $152 billion in operating revenue, which excludes investment income.

The insurer, which has been growing its government-funded Medicaid and Medicare business, also sees total medical enrollment ending up at somewhere between 45.6 million and 46.2 million people for the year after ending 2021 with about 45.4 million.

Most of Anthem’s customers have plans they bought on the individual insurance market or through employers. But the company’s government business, which includes Medicare Advantage and Medicaid programs it manages for states, grew 17% in 2021, to more than 15 million people.

In the fourth quarter, Anthem also missed the consensus expectations by about $500 million with operating revenue of $36.02 billion.

The insurer’s adjusted earnings of $5.14 per share in the quarter beat expectations by 3 cents. while Anthem’s profit doubled to $1.14 billion.

For the full year, Anthem earned $6.1 billion on $136.94 billion in operating revenue.