Centene is expanding its marketplace offerings in 10 markets in 2019, including four new states.
The St. Louis-based insurer announced on Wednesday that it will enter markets in Pennsylvania, North Carolina, South Carolina and Tennessee, and expand its reach in Florida, Georgia, Indiana, Kansas, Missouri and Texas. The plans will be offered through its Ambetter brand.
The expansion brings Centene's total ACA market share to 20 states.
Centene has profited notably off of the exchanges over the last year. At the end of Q1 this year, it reported a 13% increase in revenue, as well as net earnings up $139 million from Q1 2017. By the end of the second quarter, it saw $27.3 billion more in revenue compared to a year prior, including $14.2 billion from the individual market, which it partially attributed to its acquisition of Fidelis Care.
In Wednesday's announcement, Centene Chairman and CEO Michael F. Neidorff said his company has “successfully navigated a difficult enrollment environment, gaining market share and exceeding our growth targets.”
But the last year hasn’t been completely smooth sailing for Centene. In January, customers filed a class-action suit against the company for "selling junk plans on state exchanges and misleading enrollees about the plan benefits” and provider network.
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Centene also failed to reimburse claims from providers with whom it did actually have contracts, the suit alleged.
Late last year, Washington state pinned the company with a $1.5 million fine for its network deficiency problems. State authorities later suspended that pending no further violations, but the company was fined $100,000 for failing to fix those issues.
The expansion offers Centene the opportunity for top-line growth but could lead to margin and earnings per share exposure given the increased competition and the Trump administration's unpredictable stance on risk adjustment payments, Leerink analyst Ana Gupte, Ph.D., said in an investor note (PDF).
Nevertheless, in the announcement, Neidorff said, “Centene's priority is to continue providing accessible, high-quality healthcare services to our members.”
Insurers have profited from their ACA plans across the board, and more than half of insurers have said they will expand their marketplace offerings this year.