Insurers returned to earth in second quarter after skyrocketing profits a year ago

UnitedHealth Group was the most profitable insurer again in a quarter filled with companies warning that the pandemic is expected to remain a significant headwind until the end of 2021, especially as the Delta variant spreads .

UHG posted second quarter profit of $ 4.3 billion on revenue of $ 71.3 billion. CVS Health was the highest revenue stream for the quarter at $ 72.6 billion; the health care giant also posted the second-highest profit at $ 2.8 billion.

While several domestic payers have raised their forecasts or exceeded the quarterly projections of Wall Street analysts, the six companies feel short of the massive profits they generated at the height of the pandemic in the second quarter of 2020.

The profits of insurers in the quarter of the previous year were so high that Congress launched an investigation into their finances.

RELATED: Insurers Increase Forecast for 2021 in Q1, Even as Pandemic Impact Remains Cloudy

Payers are bracing for the influence of the pandemic to continue through the end of this year, in a more negative way. Humana executives, for example, have said they expect COVID-19 to be a headwind of $ 600 million this year.

(Graphic by Randy Leonard)

What healthcare use trends might look like by the end of 2021 is still an open question, CEO Bruce Broussard said. Non-COVID use has stabilized but COVID costs are rising again as Delta spreads.

“As we continue to navigate these uncertainties related to the pandemic in 2021… we expect 2022 to be a more normal year,” Broussard said.

The executives of Cigna and Centene echoed this sentiment. Cigna CFO Brian Evanko told investors costs related to the pandemic were higher than expected in the second quarter, even as non-COVID claims returned to near baseline levels.

The company expects this trend to continue through the end of the year. However, Cigna has consistently recorded $ 43.1 billion in revenue and $ 1.5 billion in profits thanks to notable growth, particularly in its subsidiary Evernorth, which includes Express Scripts and a number of other business lines.

RELATED: Insurer Profit Growth Outpaces Market Growth. Expect this to continue

Centene CEO Michael Neidorff has sounded the alarm about increasing cases in what public health experts have called an “unvaccinated pandemic”.

He said 83% of COVID-19 cases are of the Delta variant, with increasing hospitalizations and deaths. The vast majority (97%) of people hospitalized and 99.5% of recent deaths are unvaccinated people.

Anthem executives also reported higher than expected COVID costs during the quarter.

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