Aetna has added 250,000 Medicare Advantage members in the first quarter of 2018 on its way to a profitable first quarter as it looks to close a deal with CVS Health.
The insurer beat quarterly profit estimates, reporting $1.2 billion in net income, well above the $381 million loss the company took in the first quarter last year. That loss was due primarily to a termination agreement with Humana after a judge blocked the merger citing antitrust concerns.
“We are pleased with our strong start to the year and remain focused on our business priorities as we plan for our projected combination with CVS Health in the second half of 2018,” CEO Mark Bertolini said in a statement.
Aetna did not hold an earnings call because of its pending merger with the healthcare retail giant.
Earnings per share reached $3.67. Total revenue was up slightly at $15.3 billion compared to $15.2 billion during the first quarter last year.
Aetna managed to cut costs thanks to a planned exit from the Affordable Care Act exchanges in 2018. The insurer reported a medical benefit ratio of 80.4% for all plans, down from 82.5% during the first quarter last year. Government plans dropped from 85.3% to 82.6%.
The notable membership gains reported in Medicare Advantage plans were offset by far-lower enrollment in commercial and Medicaid plans. Overall medical membership decreased slightly to 22.1 million, down from 22.2 million at the end of the year.
Shareholders with CVS and Aetna have approved the $69 billion merger, but the two companies still face a Department of Justice review. Several groups, including the American Antitrust Institute, have raised concerns the deal would restructure the U.S. health system in a way that would hurt patients and stifle competition.