Centene delays release of 2020 guidance due to WellCare deal closure

Centene
Centene Corporation released its fourth-quarter and year-end earnings Tuesday morning. (Centene)

Centene Corporation said that it intends to release consolidated guidance for 2020 on March 3, including projections for WellCare Health Plans.

What's behind the delay? Executives said on the company's earnings call Tuesday morning that the date of closure made it tough to compile that data in time for the February release.

Centene's Chief Financial Officer Jeff Schwaneke said that the companies were still operating independently as of Jan. 23 when the deal closed, and WellCare is still finalizing audits necessary for the guidance. CEO Michael Neidorff said the number of states at play also complicated matters, delaying the 2020 figures.

"We like to do it methodically and carefully," he said. "Taking an extra 30 days or so seemed to make sense."

Neidorff also praised Congress' repeal of the industry's hated health insurance fee for 2021, and said the insurer is reviewing the Trump administration's guidance allowing states to convert their Medicaid programs into block grants.

He didn't weigh in specifically on the plan, but said state-level flexibility is crucial.

"Centene welcomes the federal government's efforts to promote state innovation across all programs," Neidorff said on the call.

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Centene posted $309 million in earnings for the fourth quarter of 2019, reaching $1.9 billion in profits for the full year ending Dec. 31. Both numbers are up from 2018, when the insurer posted $290 million in fourth-quarter profit and $1.4 billion in annual profit.

Centene also reported $18.9 billion in revenue for the quarter and $74.6 billion in revenue for all of 2019, growth of 24% year over year.

That revenue growth, Centene said, is attributable largely to the acquisition of Fidelis Care, growth on the Affordable Care Act exchanges and state-level expansion.

"This caps off another successful year for Centene and provides strong, positive momentum as we head into 2020," Neidorff said in a statement. "Having recently closed our acquisition of WellCare, we look ahead to 2020 and beyond with great confidence in the opportunities that lie ahead."

"Our company will have even greater scale and diversification, serving 1 in every 15 Americans, maintaining our leadership in government-sponsored healthcare," Neidorff said. "We are happy to welcome our WellCare colleagues to Centene and look forward to delivering on our strategy."

Centene's total membership reached 15.2 million in 2019, up by 1.1 million from the year prior. That's an increase of 8%.

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