Health insurer Humana said its first-quarter profit more than doubled as its government business surged partly from higher membership in its Medicare Advantage plans and its commercial business showed some resilience despite the economic downturn.
Humana's commercial segment medical membership of 3.47 million as of March 31 was essentially unchanged from a year ago and down 149,300 from the end of 2008.
Louisville-based Humana said it earned $205.7 million, or $1.22 per share, compared with profit of $80.2 million, or 47 cents per share, a year ago. Revenue rose 11% to $7.71 billion. Wall Street analysts polled by Thomson Reuters forecast profit of $1.18 per share on $7.65 billion in revenue.
Humana said its benefit expenses in the quarter consumed a smaller percentage of premium revenue than a year ago, as expected, due to improvements in both its government and commercial segments. The company said the reduction was due to better claims oversight resulting in it paying out proportionately fewer dollars.
Humana posted a dramatic turnaround in pretax income from its vast government segment, increasing to $166.1 million in the just-ended quarter compared with a loss of $3.2 million a year ago.
The surge was driven mainly by lower claims expenses in its Medicare prescription drug plans, a big increase in average Medicare Advantage membership and the start of member premiums for most of its Medicare Advantage plans, the company said.
Humana said its Medicare Advantage membership grew to nearly 1.47 million members as of March 31, up 16% from a year ago, and up 2 percent from the end of 2008. The year-over-year increase included 94,900 members added through acquisitions completed during 2008.
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