On average, health plan stock prices increased 13.3% compared with 5.7% for the market as a whole. Thirteen of the fourteen publicly traded health plans experienced stock price growth for the month of November, as well as growth in valuation indicators.
Five of the fourteen publicly-traded health plans released earnings in the month of November. CIGNA experienced an increase in net income due to improvement in non-operating earnings and improved administrative expense to premium ratio. Health Net’s operating income improved due to lower health benefit costs. Humana’s net earnings increased as the company posted a large increase to investment income. Triple-S experienced an increase in net earnings primarily due to a growth in non-operating earnings. WellCare reported a decline in operating income due to a deterioration of health benefits, despite an increase in membership.
Aetna, Inc. announced that it reduced its work force by 625 positions or 1.75% of its 35,500 total positions. Additionally, the company plans on making similar cuts by the end of the first quarter of 2010.
Aetna, Inc. closed its acquisition of Horizon Behavioral Services, a wholly-owned subsidiary of Tennessee-based Psychiatric Solutions. UnitedHealth Group’s subsidiary, Ingenix, announced that it has acquired St. Petersburg-based CareMedic.
Blue Shield of California appointed John Hedberg as the company’s Chief Financial Officer and Vice President of Finance and Underwriting of Individual, Small Group, and Government Business Unit. Coventry Health Care, Inc. named John Stelben as Interim Chief Financial Officer and Treasurer. Independence Blue Cross announced Lauren O’Brien as its newly created Vice President, Chief Accounting Officer. Molina Healthcare, Inc. named Richard Bock, M. D. as Chief Medical Officer of Molina Healthcare of California. Molina also appointed John Robinson, M.D. as Chief Medical Officer of Molina Healthcare of Washington.
Blues, our bi-annual review of the financial performance of Blue Cross Blue Shield Plans estimates earnings will increase in 2009 on strong non-operating results.
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