Centene Corp., the Clayton-based health insurer, on Tuesday reported a quarterly profit that edged past Wall Street estimates, helped by higher sales in its Medicaid business which sells health plans for low-income Americans.
Membership in Medicaid health insurance plans, Centene’s biggest business, increased by 61,800 to more than 8.7 million since last year.
The company, which is buying smaller rival WellCare Health Plans Inc. for $15.27 billion, hopes the deal will scale up its government-backed Medicare and Medicaid businesses, and limit its exposure to the Obamacare exchanges.
Centene’s health benefits ratio, the amount it spends on medical claims compared with its income from premiums, worsened to 88.2% in the quarter ended Sept. 30 from 86.3% a year earlier.
Net earnings attributable to Centene rose to $95 million, or 23 cents per share, from $19 million, or 5 cents per share, a year earlier, when the company took a charge from an industry-wide fee.
Excluding items, Centene brought in earnings of 96 cents per share, narrowly beating the consensus estimate of 95 cents.
Total revenue of the company rose 17% to $18.98 billion, beating analysts’ estimates of $18.43 billion.