(Corrects number of Medicare and Medicaid customers in 9thparagraph to 488,000 from 488 million)
Oct 31 (Reuters) - Insurer Cigna Corp on Thursdayreported a third-quarter profit that beat analysts' expectationsas revenue increased and it managed medical costs in itscommercial business.
Net income rose to $553 million, or $1.95 per share, from$466 million, or $1.61 per share, a year earlier.
Excluding investment gains, the company reported a profit of$1.89 per share. On that basis, analysts on average had expected$1.63, according to Thomson Reuters I/B/E/S.
Cigna, which provides U.S. and overseas health insurance aswell as disability and life insurance, said it expectedfull-year earnings of $6.70 to $6.90 per share. Analysts wereexpecting $6.65, according to Thomson Reuters I/B/E/S.
Revenue rose to $8.1 billion from $7.3 billion.
The company said the results reflected continued medicalcost management and a lower operating expense ratio that werepartly offset by some pressure on its private Medicare plans forolder people.
Cigna's report comes after larger competitor Aetna Inc missed analysts' earnings expectations earlier thisweek, in part because of funding cuts in private Medicare.UnitedHealth Group Inc's quarter met but did not beatexpectations for similar reasons.
Cigna has a private Medicare business, but it iscomparatively small.
Cigna said that as of Sept. 30, it had 13.8 millioncommercial customers and 488,000 customers in Medicare andMedicaid plans. The company also has a Medicare pharmacy benefitbusiness and manages commercial pharmacy benefits.
The vast majority of commercial customers are in self-fundedhealth plans in which Cigna administers health benefits as athird party and the company or organization is responsible forthe actual cost of covering its members.
Cigna has a small individual business and is offering plansin five states on the new Obamacare health insurance exchanges.These exchanges sell new plans created under President BarackObama's healthcare reform law that include government subsidiesbased on income. (Reporting by Caroline Humer; Editing by Lisa Von Ahn)
- Health Care Industry
- Thomson Reuters