Healthways, which provides care-management and wellness programs, lowered its fiscal 2008 earnings and revenue guidance, citing disappointing enrollment figures and the loss of two anticipated contracts.
The company reduced its fiscal 2008 earnings per share guidance to between $1.50 and $1.55, down from its December per share forecast of $1.77 to $1.86. The revised outlook includes a charge related to the Medicare Health Support pilot programs of about 22 cents per share.
Three years ago, the CMS launched Medicare Health Support to help the Medicare program and its beneficiaries save money. However, last month the CMS notified Healthways and four other companies still involved in Medicare Health Support that an early evaluation showed they were not meeting requirements, and said the program will end as scheduled this year.
Healthways also cut its revenue guidance for fiscal 2008 to $720 million to $740 million, down from its previous forecast of $782 million to $815 million. The companys latest projection sharply missed Wall Street estimates. Analysts surveyed by Thomson Financial, on average, expected fiscal 2008 profit of $1.79 per share, on revenue of $790.7 million. -- by the Associated Press