* Medical costs drop with lower consumer use
* Raises outlook for 2013
* CEO Swedish to attend White House meeting later Wednesday
By Caroline Humer
Oct 23 (Reuters) - Health insurer WellPoint Inc onWednesday said it was not ready to provide profit forecasts for2014, citing problems launching new insurance plans underPresident Barack Obama's healthcare reform, sending shareslower.
WellPoint is one of the leading insurers offering healthplans on the state-based exchanges created under Obamacare toprovide coverage for millions of Americans.
The exchanges launched on Oct. 1 and the enrollment efforthas been stymied by technical problems on the federalgovernment's Healthcare.gov website serving 36 states. That has raised concerns that consumers will not be able to sign up intime to get coverage starting on Jan. 1.
WellPoint does not yet have an accurate picture ofenrollment in these exchanges, Chief Executive Officer JosephSwedish said during a conference call. WellPoint has signed upnew members in these plans, but the company declined to givenumbers.
The White House was due to convene a meeting with leadinginsurance company CEOs, including Swedish, later onWednesday.
Shares in WellPoint, which operates 14 Blue Cross BlueShield licenses, fell 3 percent. Rivals Aetna Inc andUnitedHealth dropped 2.3 percent and 0.8 percent.
"We remain optimistic about the long-term membership growthopportunities on the exchanges, but given that we are just threeweeks into the open enrollment period, it is really too early todraw any definitive conclusions," Swedish said during a callwith investors.
Chief Financial Officer Wayne DeVeydt said that the companystill must determine how many current customers will migrate tothe exchanges and how much it will need to spend to support theplans there to gauge its 2014 performance.
One analyst said shares were off because the company wasbeing so cautious about the outlook for next year.
Morningstar senior analyst Vishnu Lekraj said the Obamacarelaunch "has been rocky to say the least," leaving many questionsabout how the implementation of them will unroll and what theaffect on insurance plan premiums will be in the longer run.
PROFIT BEATS EXPECTATIONS
Fourteen U.S. states are operating their own Obamacareexchanges, and the federal government is operating them for theother 36 states. WellPoint is selling plans on both types ofexchanges.
Since the Oct. 1 launch, technology problems have preventedmillions of people from logging onto the government site to buyplans, pushing them to phone and paper applications. Enrollmentfor 2014 is open until the end of March.
WellPoint said its third-quarter net income fell to $656.2million, or $2.16 per share, from $691.2 million, or $2.15 pershare, a year earlier as costs rose due to investments forgrowth opportunities and increased compensation.
Earnings came to $2.10 per share, excluding favorable taxbenefits and net investment gains, up from $2.09 a year earlier.Analysts on average were expecting a profit of $1.82 per share,according to Thomson Reuters I/B/E/S.
For 2013, the company raised its 2013 membership and profitforecasts to reflect the stronger-than-expected third quarterperformance. It now expects 2013 earnings of at least $8.40 pershare. Analysts had forecast $8.27.
WellPoint said it had 35.5 million members at the end ofSeptember, an increase of 2 million from a year earlier. ItsMedicaid enrollment increased by 2.4 million members due to theacquisition of Amerigroup, while its commercial and Medicarebusinesses declined. It expects to end the year with 35.6million people enrolled in medical plans.
The company said it had spent 84.9 percent of its premiumincome on providing healthcare, down from 85.4 percent a yearearlier.
WellPoint said unit cost increases and use of medicalservices were lower than anticipated during the first ninemonths of this year. Use of medical services, includinghospitalizations, doctor visits and elective surgery, has beendown in recent years because of the weak economy and as healthplans have shifted more of the cost to consumers.
The report comes one week after results from UnitedHealth,whose 2014 outlook for the private Medicare business wasperceived negatively by investors and drove down shares ofWellPoint, Cigna Corp, Aetna, and Humana Inc.
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