- Centene reported a $535 million loss for the second quarter as more members returned for in-person care following the prior-year period where utilization was drastically lower due to the COVID-19 pandemic.
- Membership increased 3% year over year thanks in part to policy changes that allow Medicaid members' coverage to go uninterrupted during the duration of the public health emergency. This trend fueled revenue growth of 12% for the quarter ended June 30.
- CEO Michael Neidorff warned the delta variant is causing a new wave of the pandemic. "It remains clear that the pandemic is not over, and the environment could remain choppy for the balance of the year," Neidorff said Tuesday during a call with investors.
Insurers are keeping close watch on utilization trends as patients return to in-person care after a year of putting it off.
Neidorff said Tuesday the company is seeing higher utilization trends among marketplace members, or those who buy plans off the Affordable Care Act exchanges.
The higher utilization is driven by "pent up demand," he said. This led to a higher-than-expected medical loss ratio for the quarter of 88.3%, an important measure of how much an insurer is spending on care.
There was a "broad return to the doctor's office" in March and April, CFO Drew Asher said, but Centene had expected the slight downtick in May utilization to persist. That did not happen. Instead, utilization increased again in June.
Asher provided some color on what sorts of services were driving utilization among marketplace members. In addition to orthopaedics and deteriorating joints, these members also are seeking out psychiatry and chemical dependency services.
The members Centene picked up during the ACA special enrollment period established during COVID-19 are using inpatient services, a potential marker that these patients are sicker. Asher said after accessing inpatient services these patients quickly return to normal utilization but cautioned, "it's early, so we're tracking that."
The vast majority of these new special enrollment members have been previously uninsured, Brent Layton, president of U.S. health plans, products, and international and executive vice president, said Tuesday.
As concerns grow over the delta variant, Centene disclosed that about 50% of its membership has received the COVID-19 vaccine. Though it's important to note that Centene covers many children not eligible for a vaccine through Medicaid.
Below-normal medical usage propelled Centene's first quarter results, giving the payer confidence to raise its full-year guidance. Executives warned that as the delta variant takes hold the remainder of the year could lead to choppy performance.
Centene saw its Medicaid membership grow as a result of the suspension of eligibility redeterminations. Centene hinted that these suspensions could continue into 2023.
The special enrollment period as been a boon to the marketplaces. So far, more than 2 million people nationwide have signed up during the period, which ends Aug. 15.
Recently within Centene there has been some personnel shake-up with launch of an office of the president, a three-member executive team that includes Neidorff, Layton and Sarah London, president of health care enterprises and executive vice president of advanced technology.
Centene ended the quarter with 25.4 million members.