Although Aetna reported first quarter earnings that dropped 4.1 percent, primarily because of costs associated with acquiring Coventry Health Care, the third largest health insurer increased its revenue and enrollment.
Aetna earned $490.1 million in profit, down from $511 million a year earlier, amid $24.6 million in after-tax costs related to the Coventry acquisition and a 9 percent growth in claims costs. But Aetna's revenue increased 7 percent to $9.54 billion and enrollment rose 2 percent to 18.3 million members, largely from its increased market presence in the Medicare business, according to its earnings report released Tuesday.
"Looking ahead to the remainder of 2013, we continue to expect strong top-line growth and solid operating performance," Aetna Chief Executive Mark Bertolini said on a conference call with analysts, the Wall Street Journal reported.
Bertolini also discussed Aetna's plans to sell policies on health insurance exchanges, saying the insurer intends to operate in 14 markets. Aiming for a "measured" approach to the online marketplaces, Bertolini said "we just think that we have to see how these things operate, and we're not going to go in for a land grab," according to Reuters.
That's why Aetna has reduced the projected number of policies it will sell through the exchanges, Kaiser Health News reported. "This is going to be a slow uptake," Bertolini said. "The process required to sign up, to get the subsidies, is going to take some time. And I think this is a two-year ramp to get the individual exchanges up to a level where customers are going to feel appropriate signing up. And so our estimates of what we believe … enrollment [will be] are dropping for the first year."