Centene reported $3.3 billion in 2024 profits as Obamacare enrollment and premium revenue helped … [+]
Centene Tuesday reported $3.3 billion in 2024 profits as Obamacare enrollment and premium revenue helped overcome a big dip in Medicaid enrollment.
Centene, which sells an array of government subsidized health insurance including Medicaid coverage for poor Americans and individual commercial insurance coverage under the Affordable Care Act known as Obamacare, reported net income of $3.3 billion, or $6.31 a share, for 2024, compared to $2.7 billion, or $4.97 in 2023. In the fourth quarter, net income was $283 million, or 56 cents a share, compared to $45 million, or 8 cents a share in the fourth quarter of 2023.
Centene said total managed care membership grew total managed care membership grew to 28.6 million at the end of the fourth quarter compared to 27.47 million at the end of the fourth quarter of 2023 thanks largely to Obamacare enrollment.
Centene’s enrollment in individual coverage under the Affordable Care Act, also known as Obamacare, grew what Centene calls its “commercial marketplace” business 12% to nearly 4.4 million members as of Dec. 31, 2024 from 3.9 million a year ago. That increase helped overcome a 1.4 million decrease in enrollment in Centene’s Medicaid plans for poor Americans.
“Despite a year of unprecedented industry headwinds, Centene demonstrated significant operational improvements, strengthened our talent bench, and delivered on our financial commitments in 2024,” said Chief Executive Officer of Centene, Sarah M. London. “We enter 2025 with a strong, diversified platform and exciting opportunity to deliver value in each of our core businesses and to transform the health of communities we serve, one person at a time.”
The deterioration of Medicaid enrollment is an industrywide problem thanks largely to the end of the U.S. public health emergency declared for the COVID-19 pandemic.
The U.S. public health emergency kept record numbers of people covered by not kicking anyone off Medicaid while Congress and the Biden administration increased and expanded subsidies so more Americans to afford individual Obamacare coverage under the Affordable Care Act. That has helped Centene keep its total health insurance enrollment growing.
Enrollment is shifting nationally given the end in May 2023 of the U.S. public health emergency that boosted the number of Americans covered when Medicaid redetermination temporarily ended three years ago. Medicaid redetermination, also described as Medicaid renewal or Medicaid recertification, is essentially when people are asked to show they are qualified for such coverage.
“For the full year 2024, premium and service revenues increased 4% to $145.5 billion from $140.1 billion in the comparable period of 2023 primarily driven by membership growth in the marketplace business due to strong product positioning as well as overall market growth and outperformance in marketplace risk adjustment for the 2023 benefit year, along with Medicaid rate increases,” Centene said in its earnings report. “The increases were partially offset by lower Medicaid membership primarily due to redeterminations and divestitures in the Other segment.”
Looking ahead, Centene said its increasing its 2025 premium and service revenues “guidance range by $4.0 billion to a range of $158.0 billion to $160.0 billion.” That move reflects greater than expected premium revenue from Medicare prescription drug plans, Medicare Advantage enrollment and additional revenue “due to a program change adding behavioral health coverage in one of our state contracts.”
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