WellPoint raises forecast after profit surges

Business continued to improve at WellPoint Inc. in the second quarter, helping the health insurer beat Wall Street’s expectations and raise its profit forecast for the year.

The Indianapolis-based company reported Wednesday morning that it earned $2.64 per share in the three months ended June 30. Excluding investment gains, WellPoint earned $2.60 per share, a 27.5-percent increase over the same quarter a year ago.

Analysts were expecting earnings of $2.11 per share, according to a survey by Thomson Financial.

WellPoint raised its full-year profit forecast by 20 cents per share, excluding the impact of investments, to $8 per share.

Overall profit for the quarter rose 24 percent from a year ago to $800.1 million, as WellPoint’s customers continued to file modest amounts of medical claims. WellPoint spent 83.9 percent of its premium revenue on claims, a tick higher than in the first quarter but well below its predicted level of 85.5 percent for the year.

“We are pleased with our second quarter results and encouraged by the positive momentum we have across the organization. Our commercial businesses continue to perform well and we have achieved improvements in our Medicaid operations,” WellPoint CEO Joe Swedish said in a prepared statement.

WellPoint’s revenue for the quarter rose 16 percent to $17.8 billion. Those numbers were boosted by WellPoint’s acquisition of Virginia-based Amerigroup Corp. in December.

Analysts were expecting revenue of $17.9 billion.

WellPoint provided health benefits for 35.7 million Americans at the end of June, more than any other company in the United States. WellPoint lost 143,000 members from its health plans in the second quarter, primarily because its employer customers trimmed their staffs.

WellPoint shares closed Tuesday at $87.51 apiece. They have soared in value since WellPoint named Swedish as its next CEO in February, rising nearly 33 percent.