Health Net turned a profit in the third quarter of this year, but the insurer lost thousands of members in its employer and individual markets.
But the Woodland Hills, Calif.-based company is focused on closing its pending deal with Centene Corp., a dominant Medicaid managed-care insurer. Health Net's shareholders recently approved the $6.8 billion transaction in which Centene would absorb Health Net.
Health Net booked a $60.3 million profit in the third quarter compared with an $8.9 million loss last year. Revenue bumped upward by 10% to approximately $4.2 billion thanks to large enrollment gains in Medicaid. Health Net added 279,000 Medicaid enrollees year over year.
However, the company lost 95,000 commercial members since September 2014. Almost half of the lost membership came from employers with at least 50 workers. Another 36,000 people who purchased Health Net plans on and off the individual exchanges dropped their coverage, according to the company's third-quarter release. Most of the individual market losses came in Arizona. Health Net's other major presence is in California.
More than 3.27 million people had a Health Net plan, as of Sept. 30. Health Net also covers 2.8 million beneficiaries through Tricare, the health insurance program for active military members.
Health Net had been exploring buyout partners since September 2013 before ultimately choosing Centene. Health Net CEO Jay Gellert and Centene CEO Michael Neidorff first met in November 2014 to discuss a potential merger. Company executives expect the deal to close early next year.
