2018 MIDTERM ELECTION

Time: D H M S

Well, at least one large carrier is making a few bucks off the exchanges...

With all the gloom & doom over UnitedHealthcare pulling out of over 2 dozen states next year due to large losses on ACA exchange policies, one might wonder whether anyone is actually making money on the exchanges.

Well, today, Centene appears to have answered that question:

Centene (a Medicaid insurer) is achieving profit margins on its #ACA exchange plans "at the higher end of our targeted range."

— Bob Herman (@MHbherman) April 26, 2016

Last fall, Centene's quarterly report stated that they had around 155,600 ACA exchange enrollees nationally, or just 1.7% of the total, so this might not seem that significant.

HOWEVER, I just checked their Q1 2016 10-Q report, and there's an eye-opener on page 24:

At March 31, 2016, the Company served 984,900 members in Medicaid expansion programs in nine states and 362,300 dual-eligible members, compared to 331,800 members in Medicaid expansion programs in seven states and 184,000 dual-eligible members at March 31, 2015, included in the table above. At March 31, 2016, the Company served 683,000 members in Health Insurance Marketplaces, compared to 161,700 at March 31, 2015.

Bob Herman explains that most of these came from Centene acquiring competitor HealthNet. However, HealthNet only had around 259,000 exchange enrollees last September. Adding those to Centene brings the total up to around 415,000 enrollees combined as of last September.

Total exchange enrollment nationally dropped a further 5.7% nationally between 9/30/15 and 12/31/15 (from 9.3 million to 8.8 million). Assuming Centene/HealthNet's totals dropped at the same rate, that means they were down to roughly 391,000 enrollees as of the end of the year.

That means combined Centene/HealthNet enrollments were still up 75% from the end of the year (and remember, this is after accounting for nonpayments/net attrition since the end of Open Enrollment).

It's more appropriate to compare Q1 2016 vs. Q1 2015: Centene had 161,700 in March 2015, plus HealthNet's 279,000, for 440,700 total. That means Centene/HealthNet is up 55% year over year.

In any event, Centene doesn't say what their "targeted range" actually is; it's possible that they were only "targeting" small losses or breaking even. However, the "profit margin" wording certainly makes it sound like they made at least a small profit on those 683,000 people...which represent around 6% of the total exchange enrollments nationally this year.