(Corrects number of Medicare and Medicaid customers in 9th
paragraph to 488,000 from 488 million)
Oct 31 Insurer Cigna Corp on Thursday
reported a third-quarter profit that beat analysts' expectations
as revenue increased and it managed medical costs in its
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 as
well as disability and life insurance, said it expected
full-year earnings of $6.70 to $6.90 per share. Analysts were
expecting $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 medical
cost management and a lower operating expense ratio that were
partly offset by some pressure on its private Medicare plans for
Cigna's report comes after larger competitor Aetna Inc
missed analysts' earnings expectations earlier this
week, in part because of funding cuts in private Medicare.
UnitedHealth Group Inc's quarter met but did not beat
expectations for similar reasons.
Cigna has a private Medicare business, but it is
Cigna said that as of Sept. 30, it had 13.8 million
commercial customers and 488,000 customers in Medicare and
Medicaid plans. The company also has a Medicare pharmacy benefit
business and manages commercial pharmacy benefits.
The vast majority of commercial customers are in self-funded
health plans in which Cigna administers health benefits as a
third party and the company or organization is responsible for
the actual cost of covering its members.
Cigna has a small individual business and is offering plans
in five states on the new Obamacare health insurance exchanges.
These exchanges sell new plans created under President Barack
Obama's healthcare reform law that include government subsidies
based on income.
(Reporting by Caroline Humer; Editing by Lisa Von Ahn)