Dive Brief:
- First-quarter net income at health insurer WellPoint plunged almost 21% from $885.2 million in 2013 to $701 million this year.
- For the first three months ending March 31, the health insurer reported total revenues of about $17.9 billion, up 1.6% from the first quarter of 2013.
- WellPoint's SG&A expense ratio was 16.2% in the first quarter of 2014, up from 13.4% in 2013, driven in part by new fees related to health care reform and spending on reform-driven market changes.
Dive Insight:
It looks like WellPoint was hit pretty hard by health care reform related expenses, but it also reported higher administrative costs for membership growth, a mixed blessing unavoidable in this business. All was not negative for WellPoint however; the report in Becker's Hospital Review notes that WellPoint's benefit expense ratio dropped to 82.7% in the first quarter of this year, as compared with 83.7% last year, due primarily to improvement in the insurer's Medicaid business.