Today's earnings announcements from health plans and insurers don't look too bad. WellPoint reported a 20 percent surge in profits yesterday, a gain that the company attributes to an increase in membership and decreased medical costs. Aetna also posted good earnings, with first quarter profits up 3.2 percent, but reported a first quarter medical cost ratio of 79.4 percent in its main commercial business. That was up from 77.9 percent a year earlier. Meanwhile, PBM Express Scripts had first quarter earnings of $104.7 million compared with $85.3 million for the same period a year ago.
Wall Street wasn't having any of it. Aetna's stock was down over 20 percent today as the company's CEO Jack Rowe hands over the reins to Ron Williams and CFO Alan Bennett makes plans to retire in 2007. Express Scripts stock is down nearly 10 percent, and the rest of the health plan and PBM sector is down heavily too.