WellPoint cautious about 'fluid' market despite profit growth
As WellPoint announced its unexpectedly high fourth-quarter earnings, the second largest insurer remained cautious about its future this year, yet hopeful about 2014.
WellPoint's net income rose 38 percent to $464.2 million last quarter, up from 335.3 million. And its enrollment increased by 5.5 percent to 36 million people, with help from its Amerigroup purchase last year, according to its earnings report released last week.
But despite the strong results, WellPoint lowered its guidance for 2013, because of a potential "fluid and dynamic" market during the next 24 months, including unknown flu costs, federal budget uncertainties related to potentially overhauling Medicare and Medicaid and health reform, the Los Angeles Times reported.
The insurer is, however, looking forward to 2014 when health insurance exchanges open to the public. WellPoint plans to participate in the online marketplaces in the 14 states in which it operates.
"We expect this to be a growth opportunity," WellPoint Chief Financial Officer Wayne DeVeydt told Reuters. "If you look at who is eligible for a full or partial subsidy on the exchanges, that represents almost 66 percent of the U.S. population."
WellPoint also is still searching for a new CEO to replace Angela Bray and hopes to make a selection sometime this quarter.
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