(Reuters) - Health insurer WellPoint Inc WLP.N on Wednesday reported a third-quarter profit that beat analysts’ expectations as it added new members and the cost of providing healthcare services was lower than anticipated.
The company said it had 35.5 million members at the end of September, an increase of 2 million from a year earlier. Its Medicaid enrollment increased by 2.4 million members due to the acquisition of Amerigroup, while its commercial and Medicare businesses declined.
WellPoint, which operates 14 Blue Cross Blue Shield licenses, beat analysts’ expectations for quarterly earnings, excluding favorable tax benefits and net investment gains. It said that it had a profit of $2.10 per share in the quarter, up from $2.09 a year earlier.
Analysts on average were expecting earnings of $1.82 per share, according to Thomson Reuters I/B/E/S.
The company raised its 2013 membership and profit forecasts to reflect the stronger-than-expected quarter and its “outlook for coming market changes under the Affordable Care Act,” Chief Executive Officer Joseph Swedish said in a statement.
Third-quarter net income fell as costs rose due to investments for growth opportunities and increased compensation. The company reported net income of $656.2 million, or $2.16 per share, compared with $691.2 million, or $2.15 per share, a year earlier.
Reporting by Caroline Humer; Editing by Lisa Von Ahn