The failed merger with Humana didn’t help matters, but the main culprit in Aetna’s losing money in the first quarter is its Obamacare health plans, Aetna officials said yesterday. The Wall Street Journal reports that in the first quarter, Aetna lost $381 million, compared to a $737 million profit in the first quarter a year ago. Aetna’s revenue fell 3.4% to $15.17 billion.
Aetna participated in 15 state ACA exchanges last year; this year it is in four. Aetna announced in early April that it would not be participating Iowa’s ACA exchange next year. That leaves Delaware, Nebraska and Virginia.
Shawn M. Guertin, Aetna’s CFO, didn’t sound hopeful in a call with financial analysts yesterday, as the Wall Street Journal reports. He said that the company wants to “significantly” reduce its exposure in the individual market next year. He told the newspaper that “obviously the results drive the decision to reduce our exposure and manage this risk.”
When the courts blocked the Aetna-Humana merger in January, Humana’s statement about the mutual termination mentioned that it will receive a breakup fee of about $1 billion, or nearly $630 million after taxes.
Source: Wall Street Journal