Centene says Medicaid costs remain high in May
(Reuters) -Health insurer Centene said on Wednesday it had bigger-than-expected claim receipts in April and the trend of higher medical costs in Medicaid continued into May.
Medicaid is the federal health program for low-income people and families in the United States.
Earlier in the day, shares of U.S. health insurers fellafter UnitedHealth Group cited a near-term disturbance around reimbursement rates for Medicaid due to program-wide enrollment hurdles that began about a year ago.
"The commentary around Medicaid redeterminations will also create uncertainty for the companies with exposure to Medicaid," Mizuho analyst Ann Hynes said.
Shares of Centene were down 1.4% at $69.50 in extended trading after falling about 3.7% during market hours.
Medicaid accounts for approximately 65% of Centene's total revenue and about 54% of total medical membership, Hynes said.
Medicaid memberships were hit by the removal of pandemic-related relief measures in April 2023 that rendered several members ineligible for insurance coverage.
Centene lost a little more than 260,000 Medicaid members in the second quarter last year due to redetermination, and had around 13 million members under Medicaid as of March 31, 2024.
The company said last year that it was working to enroll people who may still be eligible but were disenrolled back into Medicaid plans.
Centene also said it expects to reaffirm its 2024 adjusted profit forecast of greater than $6.80 per share.
The insurer added that the Medicare segment "is on track with expectations in April 2024". The Medicare program provides health insurance to people aged 65 and older or who are disabled.
(Reporting by Sneha S K in Bengaluru; Editing by Maju Samuel)
