Indianapolis-based Anthem Inc. topped second-quarter expectations even though the health insurer’s profit dropped as patients who hunkered down last year at the start of the COVID-19 pandemic started seeking care again.
Growing enrollment in government-funded programs such as Medicaid and Medicare Advantage helped Anthem balance the jump in care use. The Blue Cross-Blue Shield insurer also booked more revenue from its IngenioRx business, which runs pharmacy benefits.
Overall, Anthem said Wednesday that its profit fell 21%, to $1.79 billion, and adjusted earnings totaled $7.03 per share. Operating revenue, which excludes investment income, rose 14%, to $33.28 billion.
Analysts expected, on average, earnings of $6.34 per share on $33.15 billion in revenue, according to Zacks Investment Research.
Anthem covers more than 43 million people in several states, including big markets like New York and California. Its IngenioRx business also brought in about $6.2 billion in revenue during the quarter.
Health insurer profits soared last year after the pandemic set in and patients canceled or postponed elective surgeries and other non-COVID-19 care. But insurance executives predicted that much of that care would eventually take place.
Anthem’s benefit expense jumped 27% in the recently completed second quarter to nearly $25 billion. But enrollment in state and federally funded Medicaid plans that Anthem manages climbed 19%, to 9.7 million people.
That was helped partly by a suspension of state attempts to recertify the eligibility of people with Medicaid coverage during the pandemic.
Anthem also said Wednesday that it now expects its full-year adjusted profit to be greater than $25.50 per share, up from a previous forecast for earnings surpassing $25.10 per share.
The new outlook tops the average analyst forecast for $25.26 per share, according to FactSet.
Company shares rose 1.4% to $395.45 each in early trading Wednesday, but then fell back to $388.53 later in the morning. The stock has already climbed 21% since the beginning of the year and 51% in the last 12 months.