WellPoint Reports Lower Q4 Earnings as More U.S. Residents Lose Jobs, Employer-Sponsored Health Coverage
WellPoint on Wednesday announced that fourth-quarter earnings decreased by 61% to $331.4 million, or 65 cents a share, from $859.1 million, or $1.51 a share, a year earlier, the AP/Boston Globe reports. WellPoint attributed the decrease to a reduction in membership as employers continue to downsize and investment losses that amounted to $350.5 million, or 69 cents per share. According to WellPoint, the company would have reported fourth-quarter earnings of $1.34 per share without investment losses (AP/Boston Globe, 1/28). WellPoint also said that fourth-quarter revenue decreased by 3.2% from a year earlier to $15.07 billion and that operating revenue increased by 0.7% to $15.43 billion.In addition, WellPoint said that membership at the end of the fourth quarter totaled 35 million, an increase of 0.7% from a year earlier but a decrease of 0.8% from the third quarter. The company said that nearly half of the 288,000 health plan members it lost in the quarter resulted from layoffs or other job departures. WellPoint reported enrollment declines in nearly every segment of health plans it sells, including Medicare (Dorman, Wall Street Journal, 1/28). WellPoint reported a fourth-quarter medical-loss ratio, the percentage of premium revenue used to cover the cost of medical bills for members, of 83.4%, an increase from 82.9% a year earlier, in part because of computer problems that affected the ability of the company to calculate premiums properly and higher-than-expected costs in Medicare plans (Fuhrmans, Wall Street Journal, 1/29). This is part of the Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
