Humana's fourth quarter profits soared 86 percent, primarily because of a 12 percent increase in Medicare Advantage plan enrollment and decreased medical claims expenses.
The insurer on Monday said its fourth quarter net income was $199 million, up from $107 million a year earlier, and its revenue increased 9 percent to $9.06 billion, reported the Louisville Courier-Journal.
Membership in Humana's individual Medicare prescription drug plans rose 52 percent to 2.54 million, largely benefiting from the company's partnership with Wal-Mart. Its group Medicare Advantage membership only increased 6 percent, totaling 318,200 at year's end, the Associated Press reported.
Humana said it expects about 40,000 more Medicare Advantage members this year than it previously thought, raising the total membership forecast to as much as 270,000 new Medicare Advantage members, according to Fox Business.
It also plans to expand into the Medicaid market. Although Humana hasn't traditionally focused on Medicaid, it is "well positioned to take advantage of this opportunity," and has been "analyzing and evaluating Medicaid opportunities over the past six months," CEO Michael McCallister said on a phone call with analysts. He added that Humana has a "well mapped out approach" to the Medicaid market and will have more to report in a few weeks, Fox Business noted.
Health Net, meanwhile, said its fourth quarter income fell 25 percent to $60.2 million, down from $80.4 million last year. The insurer's revenue also fell 17 percent to $2.8 billion. Health Net announced Friday that its 2011 income decreased 65 percent to $72.1 million and revenue dropped 13 percent to $11.9 billion. The revenue drops are partially related to Health Net's new contract with Tricare, which only reimburses Health Net for expenses and paid fixed fees, reported the Los Angeles Business Journal.