Health Plan Weekly

Centene Corp. and Molina Healthcare, Inc., two of the largest managed Medicaid insurers in the U.S., each reported first-quarter results that exceeded analyst expectations. Analysts noted that the companies have adjusted to a changing Medicaid segment that has stabilized somewhat following a difficult 2024 that saw the resumption of eligibility redeterminations, high costs and utilization, and too-low reimbursement from states. However, the insurers’ stock prices each declined, with Centene’s falling more than 7% in early trading after the company announced its results on April 25 and Molina’s declining 6% after releasing results on April 23.  

Centene had adjusted earnings per share (EPS) of $2.90 in the quarter, above the $2.60 Wall Street consensus estimate, while the company generated $46.6 billion of revenue, significantly higher than the $43 billion consensus. Centene also had a medical loss ratio (MLR) of 87.5%, slightly below (better than) the 87.6% consensus. The company is the nation’s largest Medicaid and Affordable Care Act exchange insurer as measured by number of lives, with nearly 13 million and 5.6 million members, respectively.   

While UnitedHealth Group’s disappointing first-quarter earnings cast a pall over the managed care sector, analysts appeared to breathe a sigh of relief after Elevance Health, Inc. reported its results on April 22.  

However, anticipated member attrition in the company’s Affordable Care Act business did raise some eyebrows, and one analyst noted that investor concern regarding high Medicare Advantage costs “still lingers.” 

Chief executives of major publicly traded health insurance companies logged high pay in 2024 despite sometimes-disappointing financial performances, according to AIS Health’s analysis of proxy statements the companies submitted to the Securities and Exchange Commission.

The CEOs of the seven major national insurers — UnitedHealth Group, The Cigna Group, Molina Healthcare, Centene Corp., Elevance Health, Inc., CVS Health Corp. and Humana Inc., earned a combined $145,996,812 in total compensation in 2024.

Although health insurers don’t have much to lose in a Supreme Court case concerning free preventive care coverage, certain diagnostics companies and pharmaceutical firms are very invested in the outcome. Those firms — and their investors — received a welcome surprise on April 21 when oral arguments in the case known as Kennedy v. Braidwood suggested that the high court will protect one of the Affordable Care Act’s key provisions. 

“The court surprisingly seems likely to uphold the constitutionality of the task force, including the appointment of task force members and the supervision by the HHS secretary,” Richard Hughes IV, a health care lawyer at Epstein Becker Green, wrote in an email to clients, reporters and other stakeholders after attending the oral arguments.  

CMS earlier this month revealed it will not approve or extend federal funding for certain state Medicaid health programs, saying the programs “distract from the core mission of Medicaid.” One expert tells AIS Health, a division of MMIT, that ending this funding could result in “serious setbacks” to addressing social determinants of health (SDOH) needs. 

At issue are designated state health programs (DSHPs) and designated state investment programs (DSIPs). Through Medicaid Section 1115 waivers, states can receive federal matching funds for DSHPs such as housing and nutritional support for Medicaid members. The matching funds free up state dollars to invest in other Medicaid programs and innovations.