Centene’s stock falls after it pulls financial outlook

Bob Herman covers health insurance, government programs, hospitals, physicians, and other providers — reporting on how money influences those businesses and shapes what we all pay for care. He is also the author of the Health Care Inc. newsletter. You can reach Bob on Signal at bobjherman.09.

Centene has withdrawn its financial guidance for the rest of the year after receiving data that showed its health insurance members in Affordable Care Act plans are getting a lot more care than the company had anticipated.

The company is also seeing a “step-up” in medical costs among its Medicaid enrollees. Centene’s stock plummeted 23% in after-hours trading Tuesday.

The surprise disclosure may be just the beginning of problems for Centene and other insurers that rely heavily on government health care enrollees. Centene gets a majority of its revenue from ACA and Medicaid plans. Despite Centene’s pleas to Republicans not to cut the taxpayer-funded programs, Republicans are advancing a bill that would result in the largest cut ever to Medicaid.