(Updated at 1 p.m. ET)
Aetna's revenue sank in the third quarter of 2017 as lower premiums and fewer Affordable Care Act exchange members once again weighed on the health insurer's top line.
Hartford, Conn.-based Aetna has posted lower year-over-year revenue for three straight quarters. In the three months ended Sept. 30, its revenue fell by 5% to $15 billion.
Aetna completely cut ties with the ACA exchanges for 2018, citing big financial losses. The company said it expects to lose $200 million on exchange plans this year. Aetna covers 240,000 individual members in 2017, with 180,000 of those on the exchanges.
Instead, the insurer has increasingly relied on Medicare as its major source of revenue. In the first quarter this year, Aetna said premiums from its government businesses, including Medicare and Medicaid, for the first time surpassed commercial premium revenue.
In the third quarter, Aetna's premium revenue slipped 6% to $12.7 billion. Its medical membership dipped 4.1% to 22.2 million at the end of the quarter because of membership losses in its commercial and Medicaid businesses.
Aetna lost about half a million Medicaid members in the quarter compared to the same period a year ago. Its commercial membership fell by 606,000 year over year. Still, it added 103,000 Medicare Advantage members in the quarter compared to the same period a year ago.
Aetna's medical loss ratio was 81.9% for the quarter, largely flat from 82% at the same time last year.
Meanwhile, Aetna's net income was helped by lower integration-related costs after the failure of its $37 billion proposed merger with Humana. Profit rose 38.7% year over year to $838 million.
In a conference call Tuesday to discuss financial results, Aetna executives kept quiet on reports that CVS Health has made an offer to buy the insurer for $66 billion. Aetna CEO Mark Bertolini at the start of the call declined to comment on rumors or speculation surrounding a potential deal.
The Wall Street Journal reported last week that the pharmacy behemoth CVS made a bid for Aetna as a way to bolster its pharmacy benefit management arm amid growing competition from Amazon and UnitedHealth Group. Already, Aetna has a long-term contract with CVS to provide PBM services to its plan members.