Has Molina Healthcare’s new leadership team been so successful in their company turnaround that they’ve run out of places to grow?
Not even close, CEO Joseph Zubretsky said during a presentation at the J.P. Morgan Healthcare Conference this week.
It has been the foremost question facing the company since staging a significant financial comeback over the last year by “harvesting” a number of savings and growth opportunities that took Molina from a net loss of $512 million at the end of 2017 to a net income of $197 million in its third quarter of 2018.
“In our view, this has been a pretty successful start to a two- to three-year turnaround story,” Zubretsky said. “Yes, there is more.”
That includes contracts in Mississippi, Illinois, Idaho, Florida, Ohio, Washington, Utah, Wisconsin and Puerto Rico.
Those revenue opportunities include reentry into Utah and Wisconsin’s state Affordable Care Act marketplaces. Zubretsky told investors last quarter the marketplace “has outperformed our expectations” and signaled a willingness to expand into new states in 2020.
Zubretsky also said more partnerships are in the works with “world-class vendors” focusing on high acuity management, pharmaceuticals and outsourcing IT operations. For example, he said Molina recently renewed a three-year agreement with CVS Caremark. Molina also assembled a consortium of software partners to address payment integrity and expects to announce the consortium over the next month.
Previously, Zubretsky has credited the financial about-face to the insurer's focus on re-contracting with high-cost providers and improving utilization controls that have reduced hospital admissions, ER visits and length of stay. Molina has also beefed up its claims integrity program and slimmed down administrative costs.