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Centene reports higher earnings due to Affordable Care Act marketplace

The acquisition of Medicaid insurance plan Fidelis in New York is moving forward.
By Susan Morse , Executive Editor

Centene's financial results for the first quarter were better than analysts had projected due to an increase in the health insurance marketplace of the Affordable Care Act

Centene on Tuesday reported net earnings of $386 million for the three months ended March 31, compared to $197 million for same time period in 2017.

First quarter revenues increased 13 percent to $13.2 billion, from $11.7 billion the year before. 

Among numerous acquisitions in March and April, Centene reported it had received regulatory approval from the New York Department of Health and New York Department of Financial Services for the proposed acquisition of Fidelis, a Medicaid insurance plan in New York State.

Fidelis Care, a Catholic network includes nearly 70,000 providers and a plan that serves more than 1.6 million members in ACA exchanges, Medicaid-available coverage through the New York State of Health Marketplace, Medicare Advantage and other plans,  according to its website.

The deal still needs approval from the New York Attorney General.

One sticking point was that the state wanted to capture $2 billion from the $3.7 billion sale, arguing Fidelis built its business on Medicaid, according to Politico. The state and Fidelis reached a deal.

Centene's line of business includes TANF, CHIP and foster care, for total Medicaid business of $7.1 million for the quarter, compared to $7 million in 2017.

Another Centene acquisition this month included MHM Services, a national provider of healthcare staffing services to correctional systems and other government agencies. Under the terms of the agreement, Centene also acquired the remaining 49 percent ownership of Centurion, the correctional healthcare services joint venture between Centene and MHM.

In March, the insurer acquired an additional 61 percent ownership of Interpreta Holdings, a clinical and genomics data analytics business, bringing total ownership to 80 percent.

In March, it completed the acquisition of Community Medical Holdings, dba Community Medical Group, an at-risk primary care provider serving about 70,000 Medicaid, Medicare Advantage and ACA marketplace consumers in Miami-Dade County, Florida.

Also in March, Centene made a 25 percent equity investment in RxAdvance, a pharmacy benefit manager. Centene has retained the rights to expand its equity investment in the future.

Centene's managed care membership totaled 12.8 million, an increase of 684,000 members, or 6 percent, over March 31, 2017.

Centene expanded its health insurance marketplace product in many states in 2017 and 2018. It reported marketplace membership of 1.6 million for 2018, compared to 1.2 million in 2017.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com