Recent News from PULSE, October 2009

Enrollment in Medicare Advantage Reaches 11.2 Million Members.

The Centers for Medicare and Medicaid recently released its Medicare Advantage enrollment data for September 2009. According to the report, total enrollment in Medicare Advantage increased 10.3% from a year ago to 11.2 million.

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CMS Investigates Humana’s Mailings to Medicare Advantage Members.

At the request of Senate Finance Committee Chairman, Max Baucus, the Centers for Medicare and Medicaid Services launched an investigation into Humana’s Medicare mailing distributions, which it considered as potentially misleading regarding health care reform legislation.

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Capital Cost Comments.

On average, health plan stock prices decreased 2.8% compared with an increase of 3.5% for the market as a whole. Only six health plans experienced appreciation in their stock prices during the month of September, while stock price valuation indicators decreased.

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Financings.

Aetna, Inc. declared an annual cash dividend of $0.04 per share.

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Personnel Changes.

AMERIGROUP Corporation announced the appointment of Timothy F. McDonald to Senior Vice President, Strategic Market Initiatives and Tara J. Wall as its Senior Vice President, Corporate Communications. Capital District Physicians Health Plan appointed Brian J. Morrissey as Senior Vice President, Marketing, and Chief Marketing Officer, and Scott Klenk as Senior Vice President, Human Capital Management. SantaFe HealthCare named Tina Kibler as Vice President and Chief Audit Executive.

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Industry News.

CIGNA Corporation, Health Net, Inc., Humana Inc., and WellPoint, Inc. have recently reaffirmed their earnings guidance for fiscal year 2009. AMERIGROUP Corporation has announced a reduction to its earnings guidance.

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Mergers and Acquisitions.

Blue Care Network of Michigan announced that it has entered into an agreement to acquire Sparrow Health System’s Physicians Health Plan of Mid-Michigan.

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Earnings Calendar.

Features dates of upcoming 3rd Quarter earnings announcements as of September 30, 2009.

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Insert.Fifteenth Annual Health Plan Pricing Survey.

After the effects of buydowns, health plans are expecting a price increase of 7.7%, slightly lower than the 7.9% expected for last year. Health benefit ratios are expected to decrease 0.1 percentage points.

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