Centene posted a $253 million loss in the second quarter as the company continues to face challenges across its ACA, Medicaid and Medicare Advantage businesses.
“We are disappointed by our second quarter results, but we have a clear understanding of the trends that have impacted our performance, and are working with urgency and focus to restore our earnings trajectory,” CEO Sarah London said.
In the second quarter of 2024, the company posted $1.1 billion in profit. In its earnings report published July 25, Centene posted $48.7 billion in second quarter revenues, up 22% year over year.
The company’s medical loss ratio was 93% in the second quarter, compared to 87.6% during the same period last year.
The financial pressures are being driven by a reduction in risk-adjustment revenue for its exchange business, increased ACA medical costs, higher medical costs in Medicaid driven primarily by behavioral health, home health and high-cost drugs, and an increase to the 2025 Medicare Advantage premium deficiency reserve.
As of June 30, Centene’s total membership stands at more than 28 million. Medicaid membership has fallen to 12.8 million, decreasing 2.4% year over year. There are nearly 5.9 million exchange members, 449,000 commercial members (group, ICHRA and off-exchange individual), more than 1 million Medicare Advantage and supplement members, and 7.8 million Medicare prescription drug plans.
On July 1, Centene pulled its earnings guidance for 2025, citing higher morbidity in the ACA market and rising costs in its Medicaid business. The company’s new guidance for adjusted earnings per share is approximately $1.75 for 2025, falling from previous projected earnings of at least $7.25 per share.
