Molina Healthcare Reports Third Quarter 2019 Financial Results
Raises Full Year 2019 Earnings Guidance
LONG BEACH, Calif.--(BUSINESS WIRE)-- Molina Healthcare, Inc. (NYSE: MOH) today reported net income for the third quarter of 2019 of $175 million, or $2.75 per diluted share, compared to net income of $197 million, or $2.90 per diluted share, in the third quarter of 2018. Financial results for the third quarter of 2019 are summarized below:
|
Three Months Ended |
|
Nine Months Ended |
||||
|
September 30, |
|
September 30, |
||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
(In millions, except per share results) |
||||||
Premium Revenue |
$4,084 |
|
$4,337 |
|
$12,085 |
|
$13,174 |
Total Revenue |
$4,243 |
|
$4,697 |
|
$12,555 |
|
$14,226 |
Pre-Tax Income |
$233 |
|
$259 |
|
$750 |
|
$743 |
Net Income |
$175 |
|
$197 |
|
$569 |
|
$506 |
EPS - Diluted |
$2.75 |
|
$2.90 |
|
$8.80 |
|
$7.60 |
|
|
|
|
|
|
|
|
MCR |
86.3% |
|
87.4% |
|
85.7% |
|
86.2% |
G&A Ratio |
7.6% |
|
6.6% |
|
7.6% |
|
7.0% |
Pre-Tax Margin |
5.5% |
|
5.5% |
|
6.0% |
|
5.2% |
Effective Tax Rate |
24.7% |
|
24.0% |
|
24.1% |
|
31.9% |
After-Tax Margin |
4.1% |
|
4.2% |
|
4.5% |
|
3.6% |
Highlights include:
- Premium revenue was $4.1 billion in the third quarter of 2019, a 5.8% decrease compared to the third quarter of 2018.
- Medical care ratio (MCR) was 86.3% in the third quarter of 2019 compared to 87.4% for the third quarter of 2018.
- General and administrative (G&A) expense ratio increased to 7.6% in the third quarter of 2019 compared to 6.6% for the third quarter of 2018.
- The third quarter results include a charge of $2 million, or a $0.03 net loss per diluted share, for the repayment of convertible notes.
- After-tax margin was 4.1% for the third quarter of 2019 compared to 4.2% in the third quarter of 2018.
- Cash and investments at the parent company amounted to $796 million as of September 30, 2019.
- Operating cash flows for the nine months ended September 30, 2019, were $398 million.
- Raised full year 2019 earnings guidance to $11.30 - $11.55 from $11.20 - $11.50, which does not include any future prior-period reserve development.
-
On October 10, 2019, the Company entered into a definitive agreement to acquire certain assets of YourCare Health Plan, Inc. Through this transaction, expected to close early next year, the Company will serve approximately 46,000 Medicaid members in seven counties in Western New York.
“We are pleased with our performance this quarter as we sustained our margin profile, produced significant excess capital, and increased our full year 2019 guidance,” said Joe Zubretsky, president and CEO. “We have accomplished this in the backdrop of commencing our pivot to growth.”
Premium Revenue
Premium revenue for the third quarter of 2019 decreased 5.8% to $4.1 billion compared to $4.3 billion in the third quarter of 2018, which was in line with the Company’s expectations.
For the nine months ended September 30, 2019, premium revenue decreased 8.3% to $12.1 billion, from $13.2 billion for the comparable period in 2018. In both periods, the lower premium revenue is primarily a result of previously announced losses of Medicaid membership in New Mexico and Florida.
Medical Care Ratio
The consolidated MCR for the third quarter of 2019 was 86.3% compared to 87.4% in the third quarter of 2018. Prior period reserve development in the quarter was negligible.
The MCR for the nine months ended September 30, 2019, improved to 85.7% compared to 86.2% for the comparable period in 2018, due to a combination of the following:
- The Medicaid MCR improved to 88.2% compared to 90.4% for the nine months ended September 30, 2018, due to improvement in all programs.
- The Medicare MCR improved to 85.2% compared to 85.7% for the nine months ended September 30, 2018.
- The Marketplace MCR was 66.7% compared to 57.5% for the nine months ended September 30, 2018. The 2018 period was positively impacted by reduced medical care costs from Cost Sharing Reduction (CSR) subsidies related to 2017 dates of service. In addition, the current year was impacted by a relatively smaller benefit from prior-year Marketplace risk adjustment compared to 2018.
General and Administrative Expense Ratio
The general and administrative expenses were 7.6% of total revenues in the third quarter of 2019 compared to 6.6% in the third quarter of 2018.
For the nine months ended September 30, 2019, the G&A ratio was 7.6% compared to 7.0% in the comparable prior-year period. In both periods, the year-over-year increases are due mainly to the year-over-year decline in total revenues.
Interest Expense
Interest expense was $22 million in the third quarter of 2019 compared to $26 million in the third quarter of 2018. The decline was due to continued repayment of convertible notes.
Other Expenses
The third quarter results included a $2 million charge on the repayment of convertible notes, resulting in a $0.03 net loss per diluted share.
Balance Sheet
Cash and investments at the parent company amounted to $796 million as of September 30, 2019, compared to $467 million as of June 30, 2019.
During the third quarter of 2019, the parent company received $430 million of dividends from the regulated health plan subsidiaries.
The Company repaid $55 million of principal on the convertible notes during the quarter, and $240 million since the beginning of the year. The impact of capital deployment actions in the quarter resulted in lower interest expense, a slight loss on repayment of the convertible notes, and a lower share count.
Cash Flow
Operating cash flows for the nine months ended September 30, 2019, amounted to $398 million and were higher compared to the nine months ended September 30, 2018, primarily due to the normal fluctuations of working capital.
Outlook
The Company raised its full year 2019 earnings guidance range to $11.30 - $11.55 per diluted share, from previously issued guidance of $11.20 - $11.50.
Guidance is based on the following:
- Assumes no future restructuring or non-run rate significant items; and
- Assumes no future prior period development.
|
|
October 29, 2019 (1) |
|
July 30, 2019 (1) |
|
|
(current) |
|
(previous) |
Premium revenue |
|
$16.1B |
|
$16.1B |
Medicaid |
|
$12.4B |
|
$12.3B |
Medicare |
|
$2.2B |
|
$2.2B |
Marketplace |
|
$1.5B |
|
$1.6B |
Premium tax revenue |
|
$565M |
|
$450M |
Investment income and other revenue |
|
$135M |
|
$115M |
Total revenue |
|
$16.8B |
|
$16.7B |
Medical care costs |
|
$13.8B |
|
$13.8B |
General and administrative expenses |
|
$1.3B |
|
$1.3B |
Premium tax expenses |
|
$565M |
|
$450M |
EBITDA (2) |
|
$1,140M - $1,160M |
|
$1,135M - $1,160M |
Depreciation and amortization |
|
$90M |
|
$90M |
Interest expense and other expenses, net |
|
$90M |
|
$90M |
Income before income taxes |
|
$960M - $980M |
|
$955M - $980M |
Net income |
|
$725M - $740M |
|
$725M - $740M |
Net income per share |
|
$11.30 - $11.55 |
|
$11.20 - $11.50 |
Diluted weighted average shares |
|
64.2M |
|
64.5M |
|
|
|
|
|
End-of-year membership: |
|
|
|
|
Medicaid and Medicare |
|
3.1M |
|
3.1M |
Marketplace |
|
270K |
|
270K - 280K |
|
|
|
|
|
Operating Statistics: |
|
|
|
|
Medical care ratio |
|
86% |
|
86% |
G&A ratio |
|
7.7% |
|
7.7% |
Effective income tax expense rate |
|
24.3% |
|
24.2% |
After-tax margin |
|
4.3% - 4.4% |
|
4.2% - 4.4% |
Medicaid |
|
3% |
|
3% |
Medicare |
|
7% |
|
7% |
Marketplace |
|
11% |
|
11% |
__________________ |
||||
| (1) All amounts are rounded and approximations. | ||||
| (2) See reconciliation of non-GAAP financial measures at the end of this release. | ||||
Conference Call
Management will host a conference call and webcast to discuss Molina Healthcare’s third quarter 2019 results at 8:00 a.m. Eastern time on Wednesday, October 30, 2019. The number to call for the interactive teleconference is (877) 883-0383 and the confirmation number is 5680857. A telephonic replay of the conference call will be available through Wednesday, November 6, 2019, by dialing (877) 344-7529 and entering confirmation number 10135133. A live audio broadcast of this conference call will be available on Molina Healthcare’s website, molinahealthcare.com. A 30‑day online replay will be available approximately an hour following the conclusion of the live broadcast.
About Molina Healthcare
Molina Healthcare, Inc., a FORTUNE 500 company, provides managed healthcare services under the Medicaid and Medicare programs and through the state insurance marketplaces. Through its locally operated health plans, Molina Healthcare served approximately 3.3 million members as of September 30, 2019. For more information about Molina Healthcare, please visit molinahealthcare.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This earnings release contains forward-looking statements regarding the Company’s revised 2019 guidance, as well as its plans, expectations, and anticipated future events. Actual results could differ materially due to numerous known and unknown risks and uncertainties. Those risks and uncertainties are discussed in the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, and the section entitled “Forward-Looking Statements” in the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2019.
These reports can be accessed under the investor relations tab of the Company’s website or on the SEC’s website at sec.gov. Given these risks and uncertainties, the Company can give no assurances that its forward-looking statements will prove to be accurate, or that any other results or events projected or contemplated by its forward-looking statements will in fact occur, and the Company cautions investors not to place undue reliance on these statements. All forward-looking statements in this release represent the Company’s judgment as of October 29, 2019, and, except as otherwise required by law, the Company disclaims any obligation to update any forward-looking statements to conform the statement to actual results or changes in its expectations.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME |
|||||||||||||||
|
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
|
(In millions, except per-share amounts) |
||||||||||||||
Revenue: |
|
|
|
|
|
|
|
||||||||
Premium revenue |
$ |
4,084 |
|
|
$ |
4,337 |
|
|
$ |
12,085 |
|
|
$ |
13,174 |
|
Premium tax revenue |
119 |
|
|
110 |
|
|
367 |
|
|
320 |
|
||||
Health insurer fees reimbursed |
— |
|
|
83 |
|
|
— |
|
|
248 |
|
||||
Service revenue |
— |
|
|
130 |
|
|
— |
|
|
391 |
|
||||
Investment income and other revenue |
40 |
|
|
37 |
|
|
103 |
|
|
93 |
|
||||
Total revenue |
4,243 |
|
|
4,697 |
|
|
12,555 |
|
|
14,226 |
|
||||
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Medical care costs |
3,523 |
|
|
3,790 |
|
|
10,360 |
|
|
11,362 |
|
||||
General and administrative expenses |
323 |
|
|
311 |
|
|
953 |
|
|
998 |
|
||||
Premium tax expenses |
119 |
|
|
110 |
|
|
367 |
|
|
320 |
|
||||
Health insurer fees |
— |
|
|
87 |
|
|
— |
|
|
261 |
|
||||
Depreciation and amortization |
21 |
|
|
25 |
|
|
68 |
|
|
76 |
|
||||
Restructuring costs |
— |
|
|
5 |
|
|
5 |
|
|
38 |
|
||||
Cost of service revenue |
— |
|
|
111 |
|
|
— |
|
|
349 |
|
||||
Total operating expenses |
3,986 |
|
|
4,439 |
|
|
11,753 |
|
|
13,404 |
|
||||
Gain on sale of subsidiary |
— |
|
|
37 |
|
|
— |
|
|
37 |
|
||||
Operating income |
257 |
|
|
295 |
|
|
802 |
|
|
859 |
|
||||
Other expenses, net: |
|
|
|
|
|
|
|
||||||||
Interest expense |
22 |
|
|
26 |
|
|
67 |
|
|
91 |
|
||||
Other expenses (income), net |
2 |
|
|
10 |
|
|
(15 |
) |
|
25 |
|
||||
Total other expenses, net |
24 |
|
|
36 |
|
|
52 |
|
|
116 |
|
||||
Income before income tax expense |
233 |
|
|
259 |
|
|
750 |
|
|
743 |
|
||||
Income tax expense |
58 |
|
|
62 |
|
|
181 |
|
|
237 |
|
||||
Net income |
$ |
175 |
|
|
$ |
197 |
|
|
$ |
569 |
|
|
$ |
506 |
|
|
|
|
|
|
|
|
|
||||||||
Net income per share, diluted |
$ |
2.75 |
|
|
$ |
2.90 |
|
|
$ |
8.80 |
|
|
$ |
7.60 |
|
|
|
|
|
|
|
|
|
||||||||
Diluted weighted average shares outstanding |
63.6 |
|
|
67.9 |
|
|
64.6 |
|
|
66.6 |
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating Statistics: |
|
|
|
|
|
|
|
||||||||
Medical care ratio |
86.3 |
% |
|
87.4 |
% |
|
85.7 |
% |
|
86.2 |
% |
||||
G&A ratio |
7.6 |
% |
|
6.6 |
% |
|
7.6 |
% |
|
7.0 |
% |
||||
Premium tax ratio |
2.8 |
% |
|
2.5 |
% |
|
2.9 |
% |
|
2.4 |
% |
||||
Effective income tax rate |
24.7 |
% |
|
24.0 |
% |
|
24.1 |
% |
|
31.9 |
% |
||||
After-tax margin |
4.1 |
% |
|
4.2 |
% |
|
4.5 |
% |
|
3.6 |
% |
||||
Medicaid |
3.4 |
% |
|
2.8 |
% |
|
3.1 |
% |
|
2.0 |
% |
||||
Medicare |
6.4 |
% |
|
1.4 |
% |
|
7.0 |
% |
|
3.7 |
% |
||||
Marketplace |
8.1 |
% |
|
15.3 |
% |
|
11.9 |
% |
|
16.7 |
% |
||||
CONSOLIDATED BALANCE SHEETS |
|||||||
|
September 30, |
|
December 31, |
||||
|
2019 |
|
2018 |
||||
|
Unaudited |
|
|
||||
|
(Dollars in millions,
|
||||||
ASSETS |
|||||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
2,679 |
|
|
$ |
2,826 |
|
Investments |
1,757 |
|
|
1,681 |
|
||
Receivables |
1,280 |
|
|
1,330 |
|
||
Prepaid expenses and other current assets |
140 |
|
|
149 |
|
||
Derivative asset |
21 |
|
|
476 |
|
||
Total current assets |
5,877 |
|
|
6,462 |
|
||
Property, equipment, and capitalized software, net |
379 |
|
|
241 |
|
||
Goodwill and intangible assets, net |
176 |
|
|
190 |
|
||
Restricted investments |
79 |
|
|
120 |
|
||
Deferred income taxes |
82 |
|
|
117 |
|
||
Other assets |
108 |
|
|
24 |
|
||
|
$ |
6,701 |
|
|
$ |
7,154 |
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||||||
Current liabilities: |
|
|
|
||||
Medical claims and benefits payable |
$ |
1,975 |
|
|
$ |
1,961 |
|
Amounts due government agencies |
612 |
|
|
967 |
|
||
Accounts payable and accrued liabilities |
478 |
|
|
390 |
|
||
Deferred revenue |
207 |
|
|
211 |
|
||
Current portion of long-term debt |
15 |
|
|
241 |
|
||
Derivative liability |
21 |
|
|
476 |
|
||
Total current liabilities |
3,308 |
|
|
4,246 |
|
||
Long-term debt |
1,239 |
|
|
1,020 |
|
||
Finance lease liabilities |
233 |
|
|
197 |
|
||
Other long-term liabilities |
90 |
|
|
44 |
|
||
Total liabilities |
4,870 |
|
|
5,507 |
|
||
Stockholders’ equity: |
|
|
|
||||
Common stock, $0.001 par value, 150 million shares authorized; outstanding: 63 million shares at September 30, 2019 and 62 million shares at December 31, 2018 |
— |
|
|
— |
|
||
Preferred stock, $0.001 par value; 20 million shares authorized, no shares issued and outstanding |
— |
|
|
— |
|
||
Additional paid-in capital |
160 |
|
|
643 |
|
||
Accumulated other comprehensive income (loss) |
5 |
|
|
(8 |
) |
||
Retained earnings |
1,666 |
|
|
1,012 |
|
||
Total stockholders’ equity |
1,831 |
|
|
1,647 |
|
||
|
$ |
6,701 |
|
|
$ |
7,154 |
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||||||||||
|
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
|
(In millions) |
||||||||||||||
Operating activities: |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
175 |
|
|
$ |
197 |
|
|
$ |
569 |
|
|
$ |
506 |
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
21 |
|
|
31 |
|
|
68 |
|
|
104 |
|
||||
Deferred income taxes |
(12 |
) |
|
(26 |
) |
|
7 |
|
|
(32 |
) |
||||
Share-based compensation |
10 |
|
|
7 |
|
|
29 |
|
|
20 |
|
||||
Amortization of convertible senior notes and finance lease liabilities |
1 |
|
|
5 |
|
|
5 |
|
|
18 |
|
||||
Loss (gain) on debt repayment |
2 |
|
|
10 |
|
|
(15 |
) |
|
25 |
|
||||
Gain on sale of subsidiary |
— |
|
|
(37 |
) |
|
— |
|
|
(37 |
) |
||||
Non-cash restructuring costs |
— |
|
|
— |
|
|
— |
|
|
17 |
|
||||
Other, net |
(8 |
) |
|
2 |
|
|
(5 |
) |
|
6 |
|
||||
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
||||||||
Receivables |
(41 |
) |
|
(192 |
) |
|
50 |
|
|
(507 |
) |
||||
Prepaid expenses and other current assets |
(24 |
) |
|
64 |
|
|
(6 |
) |
|
(117 |
) |
||||
Medical claims and benefits payable |
208 |
|
|
123 |
|
|
14 |
|
|
(144 |
) |
||||
Amounts due government agencies |
(372 |
) |
|
(716 |
) |
|
(355 |
) |
|
(511 |
) |
||||
Accounts payable and accrued liabilities |
98 |
|
|
49 |
|
|
37 |
|
|
398 |
|
||||
Deferred revenue |
177 |
|
|
(13 |
) |
|
(4 |
) |
|
(55 |
) |
||||
Income taxes |
7 |
|
|
(9 |
) |
|
4 |
|
|
118 |
|
||||
Net cash provided by (used in) operating activities |
242 |
|
|
(505 |
) |
|
398 |
|
|
(191 |
) |
||||
Investing activities: |
|
|
|
|
|
|
|
||||||||
Purchases of investments |
(776 |
) |
|
(288 |
) |
|
(1,938 |
) |
|
(1,202 |
) |
||||
Proceeds from sales and maturities of investments |
1,099 |
|
|
735 |
|
|
1,890 |
|
|
2,070 |
|
||||
Purchases of property, equipment, and capitalized software |
(10 |
) |
|
(10 |
) |
|
(30 |
) |
|
(24 |
) |
||||
Other, net |
— |
|
|
(14 |
) |
|
(2 |
) |
|
(23 |
) |
||||
Net cash provided by (used in) investing activities |
313 |
|
|
423 |
|
|
(80 |
) |
|
821 |
|
||||
Financing activities: |
|
|
|
|
|
|
|
||||||||
Repayment of principal amount of 1.125% Convertible Notes |
(55 |
) |
|
(140 |
) |
|
(240 |
) |
|
(236 |
) |
||||
Cash paid for partial settlement of 1.125% Conversion Option |
(105 |
) |
|
(343 |
) |
|
(578 |
) |
|
(477 |
) |
||||
Cash received for partial termination of 1.125% Call Option |
105 |
|
|
343 |
|
|
578 |
|
|
477 |
|
||||
Cash paid for partial termination of 1.125% Warrants |
(90 |
) |
|
(306 |
) |
|
(514 |
) |
|
(419 |
) |
||||
Proceeds from borrowings under Term Loan Facility |
— |
|
|
— |
|
|
220 |
|
|
— |
|
||||
Repayment of Credit Facility |
— |
|
|
— |
|
|
— |
|
|
(300 |
) |
||||
Repayment of 1.625% Convertible Notes |
— |
|
|
(64 |
) |
|
— |
|
|
(64 |
) |
||||
Other, net |
(3 |
) |
|
1 |
|
|
24 |
|
|
7 |
|
||||
Net cash used in financing activities |
(148 |
) |
|
(509 |
) |
|
(510 |
) |
|
(1,012 |
) |
||||
Net increase (decrease) in cash, cash equivalents, and restricted cash and cash equivalents |
407 |
|
|
(591 |
) |
|
(192 |
) |
|
(382 |
) |
||||
Cash, cash equivalents, and restricted cash and cash equivalents at beginning of period |
2,327 |
|
|
3,499 |
|
|
2,926 |
|
|
3,290 |
|
||||
Cash, cash equivalents, and restricted cash and cash equivalents at end of period |
$ |
2,734 |
|
|
$ |
2,908 |
|
|
$ |
2,734 |
|
|
$ |
2,908 |
|
HEALTH PLANS SEGMENT MEMBERSHIP |
||||||||
|
||||||||
|
September 30, 2019 |
|
December 31, 2018 |
|
September 30, 2018 |
|||
Ending Membership by Government Program: |
|
|
|
|
|
|||
TANF and CHIP |
1,993,000 |
|
|
2,295,000 |
|
|
2,436,000 |
|
Medicaid Expansion |
598,000 |
|
|
660,000 |
|
|
664,000 |
|
ABD |
364,000 |
|
|
406,000 |
|
|
415,000 |
|
Total Medicaid |
2,955,000 |
|
|
3,361,000 |
|
|
3,515,000 |
|
MMP - Integrated |
58,000 |
|
|
54,000 |
|
|
55,000 |
|
Medicare Special Needs Plans |
44,000 |
|
|
44,000 |
|
|
45,000 |
|
Total Medicare |
102,000 |
|
|
98,000 |
|
|
100,000 |
|
Total Medicaid and Medicare |
3,057,000 |
|
|
3,459,000 |
|
|
3,615,000 |
|
Marketplace |
289,000 |
|
|
362,000 |
|
|
384,000 |
|
|
3,346,000 |
|
|
3,821,000 |
|
|
3,999,000 |
|
|
|
|
|
|
|
|||
Ending Membership by Health Plan: |
|
|
|
|
|
|||
California |
580,000 |
|
|
608,000 |
|
|
623,000 |
|
Florida (1) |
136,000 |
|
|
313,000 |
|
|
395,000 |
|
Illinois |
224,000 |
|
|
224,000 |
|
|
223,000 |
|
Michigan |
361,000 |
|
|
383,000 |
|
|
394,000 |
|
New Mexico (1) |
24,000 |
|
|
222,000 |
|
|
234,000 |
|
Ohio |
292,000 |
|
|
302,000 |
|
|
315,000 |
|
Puerto Rico |
186,000 |
|
|
252,000 |
|
|
320,000 |
|
South Carolina |
134,000 |
|
|
120,000 |
|
|
117,000 |
|
Texas |
350,000 |
|
|
423,000 |
|
|
436,000 |
|
Washington |
818,000 |
|
|
781,000 |
|
|
770,000 |
|
Other (2) |
241,000 |
|
|
193,000 |
|
|
172,000 |
|
|
3,346,000 |
|
|
3,821,000 |
|
|
3,999,000 |
|
__________________ |
||||||||
| (1) The Company’s Medicaid contracts in New Mexico and in all but two regions in Florida terminated in late 2018 and early 2019. During 2019, the Company continues to serve Medicare and Marketplace members in both Florida and New Mexico, as well as Medicaid members in two regions in Florida. | ||||||||
| (2) “Other” includes the Idaho, Mississippi, New York, Utah and Wisconsin health plans, which are not individually significant to the Company’s consolidated operating results. | ||||||||
UNAUDITED SELECTED FINANCIAL DATA
|
|||||||||||||||||||||||||
|
|||||||||||||||||||||||||
|
Member Months (1) |
|
Premium Revenue |
|
Medical Care Costs |
|
MCR (2) |
|
Medical Margin |
||||||||||||||||
|
|
Total |
|
PMPM |
|
Total |
|
PMPM |
|
|
|||||||||||||||
|
Three Months Ended September 30, 2019 |
||||||||||||||||||||||||
TANF and CHIP |
6.0 |
|
|
$ |
1,225 |
|
|
$ |
202.46 |
|
|
$ |
1,071 |
|
|
$ |
176.88 |
|
|
87.4 |
% |
|
$ |
154 |
|
Medicaid Expansion |
1.8 |
|
|
696 |
|
|
385.63 |
|
|
622 |
|
|
345.25 |
|
|
89.5 |
|
|
74 |
|
|||||
ABD |
1.1 |
|
|
1,247 |
|
|
1,136.67 |
|
|
1,097 |
|
|
1,000.56 |
|
|
88.0 |
|
|
150 |
|
|||||
Total Medicaid |
8.9 |
|
|
3,168 |
|
|
353.81 |
|
|
2,790 |
|
|
311.70 |
|
|
88.1 |
|
|
378 |
|
|||||
MMP |
0.2 |
|
|
399 |
|
|
2,328.70 |
|
|
345 |
|
|
2,010.50 |
|
|
86.3 |
|
|
54 |
|
|||||
Medicare |
0.1 |
|
|
160 |
|
|
1,230.01 |
|
|
134 |
|
|
1,029.75 |
|
|
83.7 |
|
|
26 |
|
|||||
Total Medicare |
0.3 |
|
|
559 |
|
|
1,854.96 |
|
|
479 |
|
|
1,587.61 |
|
|
85.6 |
|
|
80 |
|
|||||
Total Medicaid and Medicare |
9.2 |
|
|
3,727 |
|
|
402.76 |
|
|
3,269 |
|
|
353.31 |
|
|
87.7 |
|
|
458 |
|
|||||
Marketplace |
0.9 |
|
|
357 |
|
|
410.23 |
|
|
254 |
|
|
292.21 |
|
|
71.2 |
|
|
103 |
|
|||||
|
10.1 |
|
|
$ |
4,084 |
|
|
$ |
403.40 |
|
|
$ |
3,523 |
|
|
$ |
348.06 |
|
|
86.3 |
% |
|
$ |
561 |
|
|
Three Months Ended September 30, 2018 |
||||||||||||||||||||||||
TANF and CHIP |
7.4 |
|
|
$ |
1,379 |
|
|
$ |
187.03 |
|
|
$ |
1,228 |
|
|
$ |
166.41 |
|
|
89.0 |
% |
|
$ |
151 |
|
Medicaid Expansion |
2.0 |
|
|
671 |
|
|
333.11 |
|
|
640 |
|
|
317.62 |
|
|
95.3 |
|
|
31 |
|
|||||
ABD |
1.2 |
|
|
1,322 |
|
|
1,054.92 |
|
|
1,186 |
|
|
946.38 |
|
|
89.7 |
|
|
136 |
|
|||||
Total Medicaid |
10.6 |
|
|
3,372 |
|
|
316.86 |
|
|
3,054 |
|
|
286.86 |
|
|
90.5 |
|
|
318 |
|
|||||
MMP |
0.2 |
|
|
353 |
|
|
2,159.72 |
|
|
323 |
|
|
1,981.45 |
|
|
91.7 |
|
|
30 |
|
|||||
Medicare |
0.1 |
|
|
156 |
|
|
1,157.71 |
|
|
121 |
|
|
895.25 |
|
|
77.3 |
|
|
35 |
|
|||||
Total Medicare |
0.3 |
|
|
509 |
|
|
1,706.95 |
|
|
444 |
|
|
1,490.63 |
|
|
87.3 |
|
|
65 |
|
|||||
Total Medicaid and Medicare |
10.9 |
|
|
3,881 |
|
|
354.70 |
|
|
3,498 |
|
|
319.63 |
|
|
90.1 |
|
|
383 |
|
|||||
Marketplace |
1.2 |
|
|
456 |
|
|
394.02 |
|
|
292 |
|
|
252.61 |
|
|
64.1 |
|
|
164 |
|
|||||
|
12.1 |
|
|
$ |
4,337 |
|
|
$ |
358.46 |
|
|
$ |
3,790 |
|
|
$ |
313.23 |
|
|
87.4 |
% |
|
$ |
547 |
|
|
Nine Months Ended September 30, 2019 |
||||||||||||||||||||||||
TANF and CHIP |
18.3 |
|
|
$ |
3,594 |
|
|
$ |
196.01 |
|
|
$ |
3,141 |
|
|
$ |
171.30 |
|
|
87.4 |
% |
|
$ |
453 |
|
Medicaid Expansion |
5.4 |
|
|
2,055 |
|
|
380.08 |
|
|
1,810 |
|
|
334.85 |
|
|
88.1 |
|
|
245 |
|
|||||
ABD |
3.3 |
|
|
3,590 |
|
|
1,097.94 |
|
|
3,200 |
|
|
978.64 |
|
|
89.1 |
|
|
390 |
|
|||||
Total Medicaid |
27.0 |
|
|
9,239 |
|
|
342.03 |
|
|
8,151 |
|
|
301.77 |
|
|
88.2 |
|
|
1,088 |
|
|||||
MMP |
0.5 |
|
|
1,193 |
|
|
2,368.38 |
|
|
1,034 |
|
|
2,051.90 |
|
|
86.6 |
|
|
159 |
|
|||||
Medicare |
0.4 |
|
|
489 |
|
|
1,270.32 |
|
|
399 |
|
|
1,037.24 |
|
|
81.7 |
|
|
90 |
|
|||||
Total Medicare |
0.9 |
|
|
1,682 |
|
|
1,892.63 |
|
|
1,433 |
|
|
1,612.29 |
|
|
85.2 |
|
|
249 |
|
|||||
Total Medicaid and Medicare |
27.9 |
|
|
10,921 |
|
|
391.44 |
|
|
9,584 |
|
|
343.53 |
|
|
87.8 |
|
|
1,337 |
|
|||||
Marketplace |
2.8 |
|
|
1,164 |
|
|
414.17 |
|
|
776 |
|
|
276.28 |
|
|
66.7 |
|
|
388 |
|
|||||
|
30.7 |
|
|
$ |
12,085 |
|
|
$ |
393.52 |
|
|
$ |
10,360 |
|
|
$ |
337.37 |
|
|
85.7 |
% |
|
$ |
1,725 |
|
|
Nine Months Ended September 30, 2018 |
||||||||||||||||||||||||
TANF and CHIP |
22.3 |
|
|
$ |
4,145 |
|
|
$ |
186.12 |
|
|
$ |
3,705 |
|
|
$ |
166.35 |
|
|
89.4 |
% |
|
$ |
440 |
|
Medicaid Expansion |
6.1 |
|
|
2,184 |
|
|
359.37 |
|
|
1,957 |
|
|
322.01 |
|
|
89.6 |
|
|
227 |
|
|||||
ABD |
3.7 |
|
|
3,864 |
|
|
1,034.25 |
|
|
3,550 |
|
|
950.11 |
|
|
91.9 |
|
|
314 |
|
|||||
Total Medicaid |
32.1 |
|
|
10,193 |
|
|
317.70 |
|
|
9,212 |
|
|
287.10 |
|
|
90.4 |
|
|
981 |
|
|||||
MMP |
0.5 |
|
|
1,077 |
|
|
2,173.90 |
|
|
941 |
|
|
1,899.26 |
|
|
87.4 |
|
|
136 |
|
|||||
Medicare |
0.4 |
|
|
470 |
|
|
1,171.59 |
|
|
385 |
|
|
959.54 |
|
|
81.9 |
|
|
85 |
|
|||||
Total Medicare |
0.9 |
|
|
1,547 |
|
|
1,725.71 |
|
|
1,326 |
|
|
1,479.06 |
|
|
85.7 |
|
|
221 |
|
|||||
Total Medicaid and Medicare |
33.0 |
|
|
11,740 |
|
|
355.96 |
|
|
10,538 |
|
|
319.50 |
|
|
89.8 |
|
|
1,202 |
|
|||||
Marketplace |
3.8 |
|
|
1,434 |
|
|
379.91 |
|
|
824 |
|
|
218.44 |
|
|
57.5 |
|
|
610 |
|
|||||
|
36.8 |
|
|
$ |
13,174 |
|
|
$ |
358.42 |
|
|
$ |
11,362 |
|
|
$ |
309.12 |
|
|
86.2 |
% |
|
$ |
1,812 |
|
__________________ |
|||||||||||||||||||||||||
| (1) A member month is defined as the aggregate of each month’s ending membership for the period presented. | |||||||||||||||||||||||||
| (2) The MCR represents medical costs as a percentage of premium revenue. | |||||||||||||||||||||||||
HEALTH PLANS SEGMENT FINANCIAL DATA — MEDICAID AND MEDICARE |
|||||||||||||||||||||||||
|
|||||||||||||||||||||||||
|
Member Months |
|
Premium Revenue |
|
Medical Care Costs |
|
MCR |
|
Medical Margin |
||||||||||||||||
|
|
Total |
|
PMPM |
|
Total |
|
PMPM |
|
|
|||||||||||||||
|
Three Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
1.6 |
|
|
$ |
510 |
|
|
$ |
315.90 |
|
|
$ |
423 |
|
|
$ |
261.97 |
|
|
82.9 |
% |
|
$ |
87 |
|
Florida |
0.3 |
|
|
130 |
|
|
436.99 |
|
|
127 |
|
|
427.80 |
|
|
97.9 |
|
|
3 |
|
|||||
Illinois |
0.7 |
|
|
257 |
|
|
383.41 |
|
|
232 |
|
|
347.28 |
|
|
90.6 |
|
|
25 |
|
|||||
Michigan |
1.1 |
|
|
401 |
|
|
373.01 |
|
|
332 |
|
|
307.97 |
|
|
82.6 |
|
|
69 |
|
|||||
Ohio |
0.9 |
|
|
615 |
|
|
687.38 |
|
|
563 |
|
|
628.98 |
|
|
91.5 |
|
|
52 |
|
|||||
Puerto Rico |
0.6 |
|
|
117 |
|
|
209.25 |
|
|
102 |
|
|
182.53 |
|
|
87.2 |
|
|
15 |
|
|||||
South Carolina |
0.4 |
|
|
151 |
|
|
379.20 |
|
|
138 |
|
|
347.23 |
|
|
91.6 |
|
|
13 |
|
|||||
Texas |
0.7 |
|
|
592 |
|
|
912.76 |
|
|
540 |
|
|
833.51 |
|
|
91.3 |
|
|
52 |
|
|||||
Washington |
2.3 |
|
|
643 |
|
|
269.52 |
|
|
570 |
|
|
238.55 |
|
|
88.5 |
|
|
73 |
|
|||||
Other (1) (2) |
0.6 |
|
|
311 |
|
|
437.60 |
|
|
242 |
|
|
341.29 |
|
|
78.0 |
|
|
69 |
|
|||||
|
9.2 |
|
|
$ |
3,727 |
|
|
$ |
402.76 |
|
|
$ |
3,269 |
|
|
$ |
353.31 |
|
|
87.7 |
% |
|
$ |
458 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
1.7 |
|
|
$ |
435 |
|
|
$ |
249.00 |
|
|
$ |
446 |
|
|
$ |
255.22 |
|
|
102.5 |
% |
|
$ |
(11 |
) |
Florida |
1.0 |
|
|
388 |
|
|
363.16 |
|
|
362 |
|
|
339.33 |
|
|
93.4 |
|
|
26 |
|
|||||
Illinois |
0.7 |
|
|
207 |
|
|
312.72 |
|
|
182 |
|
|
274.98 |
|
|
87.9 |
|
|
25 |
|
|||||
Michigan |
1.1 |
|
|
397 |
|
|
350.05 |
|
|
321 |
|
|
282.49 |
|
|
80.7 |
|
|
76 |
|
|||||
New Mexico (2) |
0.6 |
|
|
304 |
|
|
471.66 |
|
|
275 |
|
|
426.69 |
|
|
90.5 |
|
|
29 |
|
|||||
Ohio |
0.9 |
|
|
584 |
|
|
624.84 |
|
|
532 |
|
|
568.93 |
|
|
91.1 |
|
|
52 |
|
|||||
Puerto Rico |
1.0 |
|
|
179 |
|
|
189.65 |
|
|
162 |
|
|
171.96 |
|
|
90.7 |
|
|
17 |
|
|||||
South Carolina |
0.4 |
|
|
124 |
|
|
354.53 |
|
|
112 |
|
|
318.56 |
|
|
89.9 |
|
|
12 |
|
|||||
Texas |
0.7 |
|
|
577 |
|
|
848.47 |
|
|
525 |
|
|
772.14 |
|
|
91.0 |
|
|
52 |
|
|||||
Washington |
2.3 |
|
|
511 |
|
|
226.77 |
|
|
444 |
|
|
197.04 |
|
|
86.9 |
|
|
67 |
|
|||||
Other (1) |
0.5 |
|
|
175 |
|
|
334.29 |
|
|
137 |
|
|
261.49 |
|
|
78.2 |
|
|
38 |
|
|||||
|
10.9 |
|
|
$ |
3,881 |
|
|
$ |
354.70 |
|
|
$ |
3,498 |
|
|
$ |
319.63 |
|
|
90.1 |
% |
|
$ |
383 |
|
|
Nine Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
4.9 |
|
|
$ |
1,508 |
|
|
$ |
306.96 |
|
|
$ |
1,286 |
|
|
$ |
261.76 |
|
|
85.3 |
% |
|
$ |
222 |
|
Florida |
1.0 |
|
|
418 |
|
|
410.71 |
|
|
374 |
|
|
367.95 |
|
|
89.6 |
|
|
44 |
|
|||||
Illinois |
2.0 |
|
|
726 |
|
|
365.35 |
|
|
632 |
|
|
318.26 |
|
|
87.1 |
|
|
94 |
|
|||||
Michigan |
3.3 |
|
|
1,199 |
|
|
370.77 |
|
|
990 |
|
|
305.99 |
|
|
82.5 |
|
|
209 |
|
|||||
Ohio |
2.7 |
|
|
1,835 |
|
|
682.59 |
|
|
1,653 |
|
|
614.89 |
|
|
90.1 |
|
|
182 |
|
|||||
Puerto Rico |
1.8 |
|
|
341 |
|
|
190.42 |
|
|
301 |
|
|
167.98 |
|
|
88.2 |
|
|
40 |
|
|||||
South Carolina |
1.2 |
|
|
427 |
|
|
368.35 |
|
|
378 |
|
|
326.61 |
|
|
88.7 |
|
|
49 |
|
|||||
Texas |
2.0 |
|
|
1,789 |
|
|
910.64 |
|
|
1,623 |
|
|
826.20 |
|
|
90.7 |
|
|
166 |
|
|||||
Washington |
7.1 |
|
|
1,868 |
|
|
261.92 |
|
|
1,691 |
|
|
236.98 |
|
|
90.5 |
|
|
177 |
|
|||||
Other (1) (2) |
1.9 |
|
|
810 |
|
|
402.31 |
|
|
656 |
|
|
325.93 |
|
|
81.0 |
|
|
154 |
|
|||||
|
27.9 |
|
|
$ |
10,921 |
|
|
$ |
391.44 |
|
|
$ |
9,584 |
|
|
$ |
343.53 |
|
|
87.8 |
% |
|
$ |
1,337 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
5.3 |
|
|
$ |
1,446 |
|
|
$ |
270.63 |
|
|
$ |
1,299 |
|
|
$ |
243.14 |
|
|
89.8 |
% |
|
$ |
147 |
|
Florida |
3.2 |
|
|
1,147 |
|
|
356.15 |
|
|
1,069 |
|
|
331.93 |
|
|
93.2 |
|
|
78 |
|
|||||
Illinois |
1.8 |
|
|
551 |
|
|
308.45 |
|
|
474 |
|
|
265.47 |
|
|
86.1 |
|
|
77 |
|
|||||
Michigan |
3.4 |
|
|
1,161 |
|
|
343.08 |
|
|
983 |
|
|
290.26 |
|
|
84.6 |
|
|
178 |
|
|||||
New Mexico (2) |
2.0 |
|
|
936 |
|
|
469.19 |
|
|
875 |
|
|
438.70 |
|
|
93.5 |
|
|
61 |
|
|||||
Ohio |
2.8 |
|
|
1,670 |
|
|
590.71 |
|
|
1,474 |
|
|
521.26 |
|
|
88.2 |
|
|
196 |
|
|||||
Puerto Rico |
2.9 |
|
|
549 |
|
|
190.34 |
|
|
501 |
|
|
173.83 |
|
|
91.3 |
|
|
48 |
|
|||||
South Carolina |
1.1 |
|
|
369 |
|
|
350.94 |
|
|
323 |
|
|
306.76 |
|
|
87.4 |
|
|
46 |
|
|||||
Texas |
2.1 |
|
|
1,715 |
|
|
831.21 |
|
|
1,554 |
|
|
753.31 |
|
|
90.6 |
|
|
161 |
|
|||||
Washington |
6.8 |
|
|
1,666 |
|
|
245.40 |
|
|
1,544 |
|
|
227.41 |
|
|
92.7 |
|
|
122 |
|
|||||
Other (1) |
1.6 |
|
|
530 |
|
|
323.84 |
|
|
442 |
|
|
269.98 |
|
|
83.4 |
|
|
88 |
|
|||||
|
33.0 |
|
|
$ |
11,740 |
|
|
$ |
355.96 |
|
|
$ |
10,538 |
|
|
$ |
319.50 |
|
|
89.8 |
% |
|
$ |
1,202 |
|
_______________ |
|||||||||||||||||||||||||
| (1) “Other” includes the Idaho, Mississippi, New York, Utah and Wisconsin health plans, which are not individually significant to the Company’s consolidated operating results. | |||||||||||||||||||||||||
| (2) In 2019, “Other” includes the New Mexico health plan. The New Mexico health plan’s Medicaid contract terminated on December 31, 2018, and therefore its 2019 results are not individually significant to the Company’s consolidated operating results. | |||||||||||||||||||||||||
HEALTH PLANS SEGMENT FINANCIAL DATA — MARKETPLACE |
|||||||||||||||||||||||||
|
|||||||||||||||||||||||||
|
Member Months |
|
Premium Revenue |
|
Medical Care Costs |
|
MCR |
|
Medical Margin |
||||||||||||||||
|
|
Total |
|
PMPM |
|
Total |
|
PMPM |
|
|
|||||||||||||||
|
Three Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
0.2 |
|
|
$ |
57 |
|
|
$ |
371.07 |
|
|
$ |
33 |
|
|
$ |
210.87 |
|
|
56.8 |
% |
|
$ |
24 |
|
Florida |
0.1 |
|
|
41 |
|
|
349.53 |
|
|
25 |
|
|
212.00 |
|
|
60.7 |
|
|
16 |
|
|||||
Michigan |
— |
|
|
7 |
|
|
431.41 |
|
|
4 |
|
|
289.45 |
|
|
67.1 |
|
|
3 |
|
|||||
Ohio |
— |
|
|
25 |
|
|
792.96 |
|
|
19 |
|
|
626.30 |
|
|
79.0 |
|
|
6 |
|
|||||
Texas |
0.4 |
|
|
142 |
|
|
351.04 |
|
|
105 |
|
|
257.68 |
|
|
73.4 |
|
|
37 |
|
|||||
Washington |
0.1 |
|
|
45 |
|
|
719.67 |
|
|
33 |
|
|
548.75 |
|
|
76.2 |
|
|
12 |
|
|||||
Other (1) |
0.1 |
|
|
40 |
|
|
480.41 |
|
|
35 |
|
|
408.35 |
|
|
85.0 |
|
|
5 |
|
|||||
|
0.9 |
|
|
$ |
357 |
|
|
$ |
410.23 |
|
|
$ |
254 |
|
|
$ |
292.21 |
|
|
71.2 |
% |
|
$ |
103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
0.2 |
|
|
$ |
49 |
|
|
$ |
309.04 |
|
|
$ |
37 |
|
|
$ |
235.63 |
|
|
76.2 |
% |
|
$ |
12 |
|
Florida |
0.2 |
|
|
66 |
|
|
548.60 |
|
|
45 |
|
|
362.39 |
|
|
66.1 |
|
|
21 |
|
|||||
Michigan |
— |
|
|
12 |
|
|
233.51 |
|
|
7 |
|
|
145.13 |
|
|
62.1 |
|
|
5 |
|
|||||
New Mexico |
0.1 |
|
|
28 |
|
|
419.20 |
|
|
18 |
|
|
249.33 |
|
|
59.5 |
|
|
10 |
|
|||||
Ohio |
0.1 |
|
|
27 |
|
|
485.08 |
|
|
18 |
|
|
336.86 |
|
|
69.4 |
|
|
9 |
|
|||||
Texas |
0.6 |
|
|
228 |
|
|
357.54 |
|
|
134 |
|
|
209.80 |
|
|
58.7 |
|
|
94 |
|
|||||
Washington |
— |
|
|
44 |
|
|
656.70 |
|
|
34 |
|
|
518.75 |
|
|
79.0 |
|
|
10 |
|
|||||
Other (2) |
— |
|
|
2 |
|
|
NM |
|
(1 |
) |
|
NM |
|
NM |
|
3 |
|
||||||||
|
1.2 |
|
|
$ |
456 |
|
|
$ |
394.02 |
|
|
$ |
292 |
|
|
$ |
252.61 |
|
|
64.1 |
% |
|
$ |
164 |
|
|
Nine Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
0.5 |
|
|
$ |
174 |
|
|
$ |
364.72 |
|
|
$ |
101 |
|
|
$ |
210.76 |
|
|
57.8 |
% |
|
$ |
73 |
|
Florida |
0.4 |
|
|
152 |
|
|
389.44 |
|
|
81 |
|
|
207.22 |
|
|
53.2 |
|
|
71 |
|
|||||
Michigan |
— |
|
|
27 |
|
|
474.12 |
|
|
15 |
|
|
265.95 |
|
|
56.1 |
|
|
12 |
|
|||||
Ohio |
0.1 |
|
|
79 |
|
|
801.90 |
|
|
53 |
|
|
543.00 |
|
|
67.7 |
|
|
26 |
|
|||||
Texas |
1.3 |
|
|
457 |
|
|
344.19 |
|
|
331 |
|
|
249.44 |
|
|
72.5 |
|
|
126 |
|
|||||
Washington |
0.2 |
|
|
143 |
|
|
744.47 |
|
|
97 |
|
|
509.50 |
|
|
68.4 |
|
|
46 |
|
|||||
Other (1) |
0.3 |
|
|
132 |
|
|
494.59 |
|
|
98 |
|
|
364.71 |
|
|
73.7 |
|
|
34 |
|
|||||
|
2.8 |
|
|
$ |
1,164 |
|
|
$ |
414.17 |
|
|
$ |
776 |
|
|
$ |
276.28 |
|
|
66.7 |
% |
|
$ |
388 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
0.6 |
|
|
$ |
171 |
|
|
$ |
326.82 |
|
|
$ |
89 |
|
|
$ |
169.98 |
|
|
52.0 |
% |
|
$ |
82 |
|
Florida |
0.5 |
|
|
211 |
|
|
491.13 |
|
|
67 |
|
|
155.24 |
|
|
31.6 |
|
|
144 |
|
|||||
Michigan |
0.1 |
|
|
40 |
|
|
248.24 |
|
|
23 |
|
|
145.38 |
|
|
58.6 |
|
|
17 |
|
|||||
New Mexico |
0.2 |
|
|
93 |
|
|
426.07 |
|
|
55 |
|
|
247.57 |
|
|
58.1 |
|
|
38 |
|
|||||
Ohio |
0.2 |
|
|
84 |
|
|
466.75 |
|
|
58 |
|
|
324.91 |
|
|
69.6 |
|
|
26 |
|
|||||
Texas |
2.0 |
|
|
679 |
|
|
330.92 |
|
|
440 |
|
|
214.65 |
|
|
64.9 |
|
|
239 |
|
|||||
Washington |
0.2 |
|
|
139 |
|
|
654.78 |
|
|
105 |
|
|
497.00 |
|
|
75.9 |
|
|
34 |
|
|||||
Other (2) |
— |
|
|
17 |
|
|
NM |
|
(13 |
) |
|
NM |
|
NM |
|
30 |
|
||||||||
|
3.8 |
|
|
$ |
1,434 |
|
|
$ |
379.91 |
|
|
$ |
824 |
|
|
$ |
218.44 |
|
|
57.5 |
% |
|
$ |
610 |
|
__________________ |
|||||||||||||||||||||||||
| (1) “Other” includes the New Mexico, Utah and Wisconsin health plans, which are not individually significant to the Company’s consolidated operating results in 2019. | |||||||||||||||||||||||||
(2) “Other” includes the Utah and Wisconsin health plans, where the Company did not participate in the Marketplace in 2018. Therefore, the ratios for 2018 periods are not meaningful (NM). |
|||||||||||||||||||||||||
HEALTH PLANS SEGMENT FINANCIAL DATA — TOTAL |
|||||||||||||||||||||||||
|
|||||||||||||||||||||||||
|
Member Months |
|
Premium Revenue |
|
Medical Care Costs |
|
MCR |
|
Medical Margin |
||||||||||||||||
|
|
Total |
|
PMPM |
|
Total |
|
PMPM |
|
|
|||||||||||||||
|
Three Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
1.8 |
|
|
$ |
567 |
|
|
$ |
320.67 |
|
|
$ |
456 |
|
|
$ |
257.55 |
|
|
80.3 |
% |
|
$ |
111 |
|
Florida |
0.4 |
|
|
171 |
|
|
412.29 |
|
|
152 |
|
|
366.86 |
|
|
89.0 |
|
|
19 |
|
|||||
Illinois |
0.7 |
|
|
257 |
|
|
383.41 |
|
|
232 |
|
|
347.28 |
|
|
90.6 |
|
|
25 |
|
|||||
Michigan |
1.1 |
|
|
408 |
|
|
373.92 |
|
|
336 |
|
|
307.68 |
|
|
82.3 |
|
|
72 |
|
|||||
Ohio |
0.9 |
|
|
640 |
|
|
690.88 |
|
|
582 |
|
|
628.89 |
|
|
91.0 |
|
|
58 |
|
|||||
Puerto Rico |
0.6 |
|
|
117 |
|
|
209.25 |
|
|
102 |
|
|
182.53 |
|
|
87.2 |
|
|
15 |
|
|||||
South Carolina |
0.4 |
|
|
151 |
|
|
379.20 |
|
|
138 |
|
|
347.23 |
|
|
91.6 |
|
|
13 |
|
|||||
Texas |
1.1 |
|
|
734 |
|
|
696.46 |
|
|
645 |
|
|
611.78 |
|
|
87.8 |
|
|
89 |
|
|||||
Washington |
2.4 |
|
|
688 |
|
|
280.85 |
|
|
603 |
|
|
246.36 |
|
|
87.7 |
|
|
85 |
|
|||||
Other (1) (2) |
0.7 |
|
|
351 |
|
|
442.14 |
|
|
277 |
|
|
348.40 |
|
|
78.8 |
|
|
74 |
|
|||||
|
10.1 |
|
|
$ |
4,084 |
|
|
$ |
403.40 |
|
|
$ |
3,523 |
|
|
$ |
348.06 |
|
|
86.3 |
% |
|
$ |
561 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
1.9 |
|
|
$ |
484 |
|
|
$ |
253.96 |
|
|
$ |
483 |
|
|
$ |
253.60 |
|
|
99.9 |
% |
|
$ |
1 |
|
Florida |
1.2 |
|
|
454 |
|
|
382.20 |
|
|
407 |
|
|
341.70 |
|
|
89.4 |
|
|
47 |
|
|||||
Illinois |
0.7 |
|
|
207 |
|
|
312.72 |
|
|
182 |
|
|
274.98 |
|
|
87.9 |
|
|
25 |
|
|||||
Michigan |
1.1 |
|
|
409 |
|
|
345.28 |
|
|
328 |
|
|
276.88 |
|
|
80.2 |
|
|
81 |
|
|||||
New Mexico (2) |
0.7 |
|
|
332 |
|
|
466.63 |
|
|
293 |
|
|
409.68 |
|
|
87.8 |
|
|
39 |
|
|||||
Ohio |
1.0 |
|
|
611 |
|
|
616.95 |
|
|
550 |
|
|
555.83 |
|
|
90.1 |
|
|
61 |
|
|||||
Puerto Rico |
1.0 |
|
|
179 |
|
|
189.65 |
|
|
162 |
|
|
171.96 |
|
|
90.7 |
|
|
17 |
|
|||||
South Carolina |
0.4 |
|
|
124 |
|
|
354.53 |
|
|
112 |
|
|
318.56 |
|
|
89.9 |
|
|
12 |
|
|||||
Texas |
1.3 |
|
|
805 |
|
|
611.01 |
|
|
659 |
|
|
500.14 |
|
|
81.9 |
|
|
146 |
|
|||||
Washington |
2.3 |
|
|
555 |
|
|
239.25 |
|
|
478 |
|
|
206.38 |
|
|
86.3 |
|
|
77 |
|
|||||
Other (1) |
0.5 |
|
|
177 |
|
|
336.18 |
|
|
136 |
|
|
260.19 |
|
|
77.4 |
|
|
41 |
|
|||||
|
12.1 |
|
|
$ |
4,337 |
|
|
$ |
358.46 |
|
|
$ |
3,790 |
|
|
$ |
313.23 |
|
|
87.4 |
% |
|
$ |
547 |
|
|
Nine Months Ended September 30, 2019 |
||||||||||||||||||||||||
California |
5.4 |
|
|
$ |
1,682 |
|
|
$ |
312.08 |
|
|
$ |
1,387 |
|
|
$ |
257.25 |
|
|
82.4 |
% |
|
$ |
295 |
|
Florida |
1.4 |
|
|
570 |
|
|
404.81 |
|
|
455 |
|
|
323.37 |
|
|
79.9 |
|
|
115 |
|
|||||
Illinois |
2.0 |
|
|
726 |
|
|
365.35 |
|
|
632 |
|
|
318.26 |
|
|
87.1 |
|
|
94 |
|
|||||
Michigan |
3.3 |
|
|
1,226 |
|
|
372.58 |
|
|
1,005 |
|
|
305.29 |
|
|
81.9 |
|
|
221 |
|
|||||
Ohio |
2.8 |
|
|
1,914 |
|
|
686.80 |
|
|
1,706 |
|
|
612.35 |
|
|
89.2 |
|
|
208 |
|
|||||
Puerto Rico |
1.8 |
|
|
341 |
|
|
190.42 |
|
|
301 |
|
|
167.98 |
|
|
88.2 |
|
|
40 |
|
|||||
South Carolina |
1.2 |
|
|
427 |
|
|
368.35 |
|
|
378 |
|
|
326.61 |
|
|
88.7 |
|
|
49 |
|
|||||
Texas |
3.3 |
|
|
2,246 |
|
|
682.10 |
|
|
1,954 |
|
|
593.50 |
|
|
87.0 |
|
|
292 |
|
|||||
Washington |
7.3 |
|
|
2,011 |
|
|
274.52 |
|
|
1,788 |
|
|
244.10 |
|
|
88.9 |
|
|
223 |
|
|||||
Other (1) (2) |
2.2 |
|
|
942 |
|
|
413.13 |
|
|
754 |
|
|
330.48 |
|
|
80.0 |
|
|
188 |
|
|||||
|
30.7 |
|
|
$ |
12,085 |
|
|
$ |
393.52 |
|
|
$ |
10,360 |
|
|
$ |
337.37 |
|
|
85.7 |
% |
|
$ |
1,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30, 2018 |
||||||||||||||||||||||||
California |
5.9 |
|
|
$ |
1,617 |
|
|
$ |
275.64 |
|
|
$ |
1,388 |
|
|
$ |
236.61 |
|
|
85.8 |
% |
|
$ |
229 |
|
Florida |
3.7 |
|
|
1,358 |
|
|
372.07 |
|
|
1,136 |
|
|
311.09 |
|
|
83.6 |
|
|
222 |
|
|||||
Illinois |
1.8 |
|
|
551 |
|
|
308.45 |
|
|
474 |
|
|
265.47 |
|
|
86.1 |
|
|
77 |
|
|||||
Michigan |
3.5 |
|
|
1,201 |
|
|
338.83 |
|
|
1,006 |
|
|
283.77 |
|
|
83.7 |
|
|
195 |
|
|||||
New Mexico (2) |
2.2 |
|
|
1,029 |
|
|
464.92 |
|
|
930 |
|
|
419.78 |
|
|
90.3 |
|
|
99 |
|
|||||
Ohio |
3.0 |
|
|
1,754 |
|
|
583.29 |
|
|
1,532 |
|
|
509.52 |
|
|
87.4 |
|
|
222 |
|
|||||
Puerto Rico |
2.9 |
|
|
549 |
|
|
190.34 |
|
|
501 |
|
|
173.83 |
|
|
91.3 |
|
|
48 |
|
|||||
South Carolina |
1.1 |
|
|
369 |
|
|
350.94 |
|
|
323 |
|
|
306.76 |
|
|
87.4 |
|
|
46 |
|
|||||
Texas |
4.1 |
|
|
2,394 |
|
|
581.74 |
|
|
1,994 |
|
|
484.70 |
|
|
83.3 |
|
|
400 |
|
|||||
Washington |
7.0 |
|
|
1,805 |
|
|
257.82 |
|
|
1,649 |
|
|
235.59 |
|
|
91.4 |
|
|
156 |
|
|||||
Other (1) |
1.6 |
|
|
547 |
|
|
334.26 |
|
|
429 |
|
|
262.27 |
|
|
78.5 |
|
|
118 |
|
|||||
|
36.8 |
|
|
$ |
13,174 |
|
|
$ |
358.42 |
|
|
$ |
11,362 |
|
|
$ |
309.12 |
|
|
86.2 |
% |
|
$ |
1,812 |
|
__________________ |
|||||||||||||||||||||||||
(1) “Other” includes the Idaho, Mississippi, New York, Utah and Wisconsin health plans, which are not individually significant to the Company’s consolidated operating results. |
|||||||||||||||||||||||||
| (2) In 2019, “Other” includes the New Mexico health plan. The New Mexico health plan’s Medicaid contract terminated on December 31, 2018, and therefore its 2019 results are not individually significant to the Company’s consolidated operating results. | |||||||||||||||||||||||||
SELECTED FINANCIAL DATA |
|||||||||||||||||||||
|
|||||||||||||||||||||
The following table provides details of the Company’s medical care costs for the periods indicated: |
|||||||||||||||||||||
|
|||||||||||||||||||||
|
Three Months Ended September 30, |
||||||||||||||||||||
|
2019 |
|
2018 |
||||||||||||||||||
|
Amount |
|
PMPM |
|
% of Total |
|
Amount |
|
PMPM |
|
% of Total |
||||||||||
Fee for service |
$ |
2,685 |
|
|
$ |
265.12 |
|
|
76.2 |
% |
|
$ |
2,865 |
|
|
$ |
236.74 |
|
|
75.6 |
% |
Pharmacy |
412 |
|
|
40.74 |
|
|
11.7 |
|
|
495 |
|
|
40.90 |
|
|
13.1 |
|
||||
Capitation |
283 |
|
|
28.01 |
|
|
8.0 |
|
|
297 |
|
|
24.52 |
|
|
7.8 |
|
||||
Other |
143 |
|
|
14.19 |
|
|
4.1 |
|
|
133 |
|
|
11.07 |
|
|
3.5 |
|
||||
|
$ |
3,523 |
|
|
$ |
348.06 |
|
|
100.0 |
% |
|
$ |
3,790 |
|
|
$ |
313.23 |
|
|
100.0 |
% |
|
Nine Months Ended September 30, |
||||||||||||||||||||
|
2019 |
|
2018 |
||||||||||||||||||
|
Amount |
|
PMPM |
|
% of Total |
|
Amount |
|
PMPM |
|
% of Total |
||||||||||
Fee for service |
$ |
7,793 |
|
|
$ |
253.77 |
|
|
75.2 |
% |
|
$ |
8,471 |
|
|
$ |
230.46 |
|
|
74.6 |
% |
Pharmacy |
1,254 |
|
|
40.83 |
|
|
12.1 |
|
|
1,645 |
|
|
44.76 |
|
|
14.5 |
|
||||
Capitation |
856 |
|
|
27.88 |
|
|
8.3 |
|
|
891 |
|
|
24.23 |
|
|
7.8 |
|
||||
Other |
457 |
|
|
14.89 |
|
|
4.4 |
|
|
355 |
|
|
9.67 |
|
|
3.1 |
|
||||
|
$ |
10,360 |
|
|
$ |
337.37 |
|
|
100.0 |
% |
|
$ |
11,362 |
|
|
$ |
309.12 |
|
|
100.0 |
% |
The following table provides details of the Company’s medical claims and benefits payable as of the dates indicated: |
|||||||
|
September 30, |
|
December 31, |
||||
|
2019 |
|
2018 |
||||
Fee-for-service claims incurred but not paid (IBNP) |
$ |
1,424 |
|
|
$ |
1,562 |
|
Pharmacy payable |
128 |
|
|
115 |
|
||
Capitation payable |
57 |
|
|
52 |
|
||
Other (1) |
366 |
|
|
232 |
|
||
|
$ |
1,975 |
|
|
$ |
1,961 |
|
______________________ |
|||||||
| (1) “Other” medical claims and benefits payable include amounts payable to certain providers for which the Company acts as an intermediary on behalf of various state agencies without assuming financial risk. Such receipts and payments do not impact the Company’s consolidated statements of income. As of September 30, 2019 and December 31, 2018, the Company had recorded non-risk provider payables of approximately $239 million and $107 million, respectively. | |||||||
CHANGE IN MEDICAL CLAIMS AND BENEFITS PAYABLE
(Dollars in millions)
The Company’s claims liability includes a provision for adverse claims deviation based on historical experience and other factors including, but not limited to, variations in claims payment patterns, changes in utilization and cost trends, known outbreaks of disease, and large claims. The Company’s reserving methodology is consistently applied across all periods presented. The amounts displayed for “Components of medical care costs related to: Prior period” represent the amount by which the original estimate of claims and benefits payable at the beginning of the period was more than the actual amount of the liability based on information (principally the payment of claims) developed since that liability was first reported. The following table presents the components of the change in medical claims and benefits payable for the periods indicated:
|
Nine Months Ended |
|
Year Ended |
||||||||
|
September 30, |
|
Dec. 31, 2018 |
||||||||
|
2019 |
|
2018 |
|
|||||||
Medical claims and benefits payable, beginning balance |
$ |
1,961 |
|
|
$ |
2,192 |
|
|
$ |
2,192 |
|
Components of medical care costs related to: |
|
|
|
|
|
||||||
Current period |
10,613 |
|
|
11,670 |
|
|
15,478 |
|
|||
Prior period (1) |
(253 |
) |
|
(308 |
) |
|
(341 |
) |
|||
Total medical care costs |
10,360 |
|
|
11,362 |
|
|
15,137 |
|
|||
Change in non-risk and other provider payables |
131 |
|
|
60 |
|
|
13 |
|
|||
Payments for medical care costs related to: |
|
|
|
|
|
||||||
Current period |
8,996 |
|
|
9,866 |
|
|
13,671 |
|
|||
Prior period |
1,481 |
|
|
1,706 |
|
|
1,710 |
|
|||
Total paid |
10,477 |
|
|
11,572 |
|
|
15,381 |
|
|||
Medical claims and benefits payable, ending balance |
$ |
1,975 |
|
|
$ |
2,042 |
|
|
$ |
1,961 |
|
|
|
|
|
|
|
||||||
Days in claims payable, fee for service (2) |
50 |
|
|
53 |
|
|
53 |
|
|||
______________________ |
|||||||||||
(1) The September 30, 2018, and December 31, 2018, amounts include the 2018 benefit of the 2017 Marketplace CSR reimbursement of $81 million. |
|||||||||||
| (2) Claims payable includes primarily IBNP. It also includes certain fee-for-service payables reported in “Other” medical claims and benefits payable amounting to $42 million, $34 million and $43 million, as of September 30, 2019, September 30, 2018, and December 31, 2018, respectively. | |||||||||||
SUMMARY OF NON-RUN RATE ITEMS AFFECTING CURRENT QUARTER AND YEAR-TO-DATE FINANCIAL RESULTS
(In millions, except per diluted share amounts)
The table below summarizes the impact of certain expenses and other items that management believes are not indicative of longer-term business trends and operations. The individual items presented below increase (decrease) income before income tax expense.
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||||||||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||||||||||||||||||
|
Amount |
|
Per Diluted Share (1) |
|
Amount |
|
Per Diluted Share (1) |
|
Amount |
|
Per Diluted Share (1) |
|
Amount |
|
Per Diluted Share (1) |
||||||||||||||||
(Loss) gain on debt repayment |
$ |
(2 |
) |
|
$ |
(0.03 |
) |
|
$ |
(10 |
) |
|
$ |
(0.12 |
) |
|
$ |
15 |
|
|
$ |
0.18 |
|
|
$ |
(25 |
) |
|
$ |
(0.33 |
) |
Restructuring costs |
— |
|
|
— |
|
|
(5 |
) |
|
(0.06 |
) |
|
(5 |
) |
|
(0.06 |
) |
|
(38 |
) |
|
(0.45 |
) |
||||||||
Gain on sale of subsidiary |
— |
|
|
— |
|
|
37 |
|
|
0.42 |
|
|
— |
|
|
— |
|
|
37 |
|
|
0.43 |
|
||||||||
|
$ |
(2 |
) |
|
$ |
(0.03 |
) |
|
$ |
22 |
|
|
$ |
0.24 |
|
|
$ |
10 |
|
|
$ |
0.12 |
|
|
$ |
(26 |
) |
|
$ |
(0.35 |
) |
______________________ |
|||||||||||||||||||||||||||||||
(1) Except for permanent differences between GAAP and tax (such as certain expenses that are not deductible for tax purposes), per diluted share amounts are generally calculated at the statutory income tax rate of 22.6% and 22% for 2019 and 2018, respectively. |
|||||||||||||||||||||||||||||||
NON-GAAP FINANCIAL MEASURES
The Company uses non-generally accepted accounting principles, or non-GAAP, financial measures as supplemental metrics in evaluating the Company’s financial performance, making financing and business decisions, and forecasting and planning for future periods. For these reasons, management believes such measures are useful supplemental measures to investors in comparing the Company’s performance to the performance of other public companies in the health care industry. These non-GAAP financial measures should be considered as supplements to, and not as substitutes for or superior to, GAAP measures. See further information regarding non-GAAP measures below the tables.
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Net income |
$ |
175 |
|
|
$ |
197 |
|
|
$ |
569 |
|
|
$ |
506 |
|
Adjustments: |
|
|
|
|
|
|
|
||||||||
Depreciation, and amortization of intangible assets and capitalized software |
21 |
|
|
28 |
|
|
68 |
|
|
95 |
|
||||
Interest expense |
22 |
|
|
26 |
|
|
67 |
|
|
91 |
|
||||
Income tax expense |
58 |
|
|
62 |
|
|
181 |
|
|
237 |
|
||||
EBITDA |
$ |
276 |
|
|
$ |
313 |
|
|
$ |
885 |
|
|
$ |
929 |
|
Adjustments made to GAAP measures used to calculate the non-GAAP measures used in this news release follow:
Earnings before interest, taxes, depreciation and amortization (“EBITDA”): Net income on a GAAP basis less depreciation, and amortization of intangible assets and capitalized software, interest expense and income tax expense. The Company believes that EBITDA is helpful in assessing the Company’s ability to meet the cash demands of its operating units.
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||||||||||||||||||
2019 |
|
2018 |
|
2019 |
|
2018 |
|||||||||||||||||||||||||
|
Amount |
|
Per Diluted Share |
|
Amount |
|
Per Diluted Share |
|
Amount |
|
Per Diluted Share |
|
Amount |
|
Per Diluted Share |
||||||||||||||||
Net income |
$ |
175 |
|
|
$ |
2.75 |
|
|
$ |
197 |
|
|
$ |
2.90 |
|
|
$ |
569 |
|
|
$ |
8.80 |
|
|
$ |
506 |
|
|
$ |
7.60 |
|
Adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Amortization of intangible assets |
4 |
|
|
0.07 |
|
|
6 |
|
|
0.08 |
|
|
13 |
|
|
0.21 |
|
|
16 |
|
|
0.23 |
|
||||||||
Income tax effect (1) |
(1 |
) |
|
(0.02 |
) |
|
(2 |
) |
|
(0.01 |
) |
|
(3 |
) |
|
(0.05 |
) |
|
(4 |
) |
|
(0.05 |
) |
||||||||
Adjustment, net of tax effect |
3 |
|
|
0.05 |
|
|
4 |
|
|
0.07 |
|
|
10 |
|
|
0.16 |
|
|
12 |
|
|
0.18 |
|
||||||||
Adjusted net income |
$ |
178 |
|
|
$ |
2.80 |
|
|
$ |
201 |
|
|
$ |
2.97 |
|
|
$ |
579 |
|
|
$ |
8.96 |
|
|
$ |
518 |
|
|
$ |
7.78 |
|
________________________ |
|||||||||||||||||||||||||||||||
(1) Income tax effect of adjustments calculated at the blended federal and state statutory tax rate of 22.6% and 22% for 2019 and 2018, respectively. |
|||||||||||||||||||||||||||||||
Adjustments made to GAAP measures used to calculate the non-GAAP measures used in this news release follow:
Adjusted net income: Net income on a GAAP basis less amortization of intangible assets, net of income tax effect calculated at the statutory tax rate. The Company believes that adjusted net income is helpful in assessing the Company’s financial performance exclusive of the non-cash impact of the amortization of purchased intangibles.
Adjusted net income per diluted share: Adjusted net income divided by weighted average common shares outstanding on a fully diluted basis.
2019 REVISED GUIDANCE |
|||||||
Reconciliation of Non-GAAP Financial Measures |
|||||||
|
Low End |
|
High End |
||||
|
(In millions) |
||||||
Net income |
$ |
725 |
|
|
$ |
740 |
|
Adjustments: |
|
|
|
||||
Depreciation, and amortization of intangible assets and capitalized software |
90 |
|
|
90 |
|
||
Interest expense |
90 |
|
|
90 |
|
||
Income tax expense |
235 |
|
|
240 |
|
||
EBITDA |
$ |
1,140 |
|
|
$ |
1,160 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20191029005966/en/
Investor Contact: Julie Trudell, [email protected], 562-912-6720
Media Contact: Caroline Zubieta, [email protected], 562-951-1588
Source: Molina Healthcare, Inc.