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Amerigroup cites H1N1 for lower profit
Health insurer Amerigroup said its profit sank in the third quarter because of higher medical costs associated with the swine flu. Amerigroup said third-quarter profit fell 41 percent compared with a year earlier, to $22.5 million (43 cents per share). Revenue rose 15 percent, to $1.3 billion. On average, analysts polled by Thomson Reuters expected a profit of 45 cents per share on revenue of $1.32 billion.
Amerigroup said the swine flu drove up emergency room services, ambulatory surgery and physician services in the third quarter. As a result, health benefits expenses were 87.5 percent of premium revenues, versus 82 percent in the third quarter of 2008, the company said.
The benefits ratio was further elevated because of the swine flu's virulence among children, pregnant women and other high-risk population groups -- groups that represent the majority of Amerigroup's 1.8 million members.
In a release, James G. Carlson, chairman and chief executive, noted that the swine flu, "like the recession, will eventually fade."
-- Associated Press
Coventry profit falls on one-time charge
Coventry Health Care said its profit fell 17 percent in the third quarter, due to a charge related to the sale of its First Health Services unit.
The Bethesda-based health insurer earned $70.6 million (48 cents per share), down from $85.5 million (58 cents) a year earlier. Revenue rose 18 percent, to $3.44 billion from $2.93 billion.
Excluding charges for the sale of the fee-based Medicaid service business First Health Services, the company said it earned 66 cents per share. Analysts polled by Thomson Reuters expected profit of 54 cents per share on revenue of $3.48 billion.
