Aetna Inc.'s first-quarter profit fell 13 percent as benefits and expenses rose and the health insurer faced a tough comparison to year-ago earnings that included a one-time gain.
Its adjusted earnings were below Wall Street expectations, and its shares tumbled almost 10 percent in premarket trading.
The Hartford, Conn., insurer said Thursday that its net income fell to $511 million, or $1.43 per share, in the three months that ended March 31.
That's down from $586 million, or $1.50 per share, a year ago when Aetna recorded a gain of $112 million after taxes because claims left over from previous quarters came in below expectations.
In the latest quarter, adjusted earnings were $1.34 per share. Analysts surveyed by FactSet expected, on average, adjusted earnings of $1.40 per share.
Revenue excluding capital gains climbed 6 percent to $8.86 billion. Analysts expected revenue of $8.61 billion.
Total benefits and expenses climbed more than 8 percent to $8.13 billion.
Aetna shares dropped $4.84, or 9.8 percent, to $44.52 in premarket trading.
Aetna is the third-largest commercial health insurer based on both enrollment and revenue, trailing WellPoint Inc. and UnitedHealth Group Inc. Health insurance is Aetna's main product, but the company also sells dental, group life and disability coverage.
The insurer's medical enrollment, which includes commercial health insurance and people covered by Medicare and Medicaid, fell 3 percent to 17.9 million in the quarter compared to the end of last year.
Aetna reaffirmed its forecast for 2012 adjusted earnings, which exclude capital gains or losses, of about $5 per share. Analysts expect, on average, earnings of $5.15 per share.