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Jan. 31, 2008
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MHMR Jan. 31, 2008: Volume 16, Number 2
’08 MCO profits to grow 23%...WellPoint MCR jumps…United shares fall on rising MCR…SPECIAL REPORT: Wellness requires “leap of faith”…Chart: Evolution of wellness…Chart: Revenues of selected wellness companies…Aetna shares fall of ’08 outlook…Cigna 4Q07 net rises 13%...Humana raises ’08 outlook…HealthSpring eyes 20% EPS gain…Inverness to acquire Matria…WellCare names Berg chairman…MCO stocks fall 4%...Services stocks fall 2.7%...and more…
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’08 MANAGED CARE PROFITS TO GROW 23%
The managed care industry is expected to have another year of solid revenue and profit growth in 2008, with little risk of being impacted substantially by either the struggling economy or the political uncertainties of a Presidential election year, according to the newly released Outlook for Managed Care 2008 from Corporate Research Group.
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WELLPOINT 4Q07 MCR JUMPS TO 82.9%
WellPoint Inc. (Indianapolis) saw its shares plummet nearly 4% Jan. 23, the day the company announced that its medical cost ratio jumped 190 basis points to 82.9% in the fourth quarter of 2007, compared to the same period a year earlier.
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UNITED SHARES FALL ON RISING MCR
UnitedHealth Group (Minnetonka, MN) saw its shares fall 6% on Jan. 22 after the company aid that commercial medical cost ratio in the fourth-quarter of 2007 rose 310 basis points to 84.1%.
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AETNA SHARES FALL ON 2008 OUTLOOK
Shares in Aetna Inc. (Hartford, CT) fell about 2% on Thursday, Feb. 7 after the company said it expected first-quarter 2008 net income of $0.92 per share ($475 million based on 516 million shares outstanding), slightly below Wall Street expectations.
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CIGNA 4Q07 NET INCOME RISES 13%
Cigna Corp. (Philadelphia) reported fourth-quarter net income of $263 million, up 13% from the same period a year earlier, on revenues of $4.455 billion, up 6%.
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HEALTHSPRING EXPECTS 20% EPS GAIN IN 2008
HealthSpring Inc. (Nashville, TN) said it expects 2008 earnings per share of $1.75 to $1.90 ($101.3 million to $110 million based on 57.9 million shares), up about 20% from revised 2007 earnings projections of $1.50 to $1.51 per share.
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INVERNESS TO ACQUIRE MATRIA FOR $1.18 BILLION
Matria Healthcare Inc. (Marietta, GA), a disease management and wellness company struggling to find growth and strategic direction, announced that it would be acquired by Inverness Medical Innovations (Waltham, MA) in a deal valued at $1.18 million.
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WELLCARE NAMES BERG CHAIRMAN, SCHIESSER CEO
WellCare Health Plans Inc. (Tampa, FL), which is under federal investigation (MHMR, Nov. 30, 2007), has named Charles Berg chairman and Heath Schiesser president and chief executive.
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WELLNESS REQUIRES “LEAP OF FAITH,” REPORT SAYS
“Much of the debate around wellness is so new that it still requires a leap of faith among employers and health plans,” according to a new report titled ROI and Outcomes of Wellness Initiatives, 2008.
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