(Reuters) -Anthem Inc on Wednesday raised its profit target for 2021, as strength in its pharmacy benefits management business helped the U.S. health insurer beat first-quarter earnings estimates.
The company now expects to record adjusted net profit of more than $25.10 per share in 2021, up from its previous forecast of over $24.50 per share.
Health insurers have been spending millions of dollars to improve customers’ access to testing, treatment and vaccination services against the coronavirus, driving up their medical costs despite weak demand for non-COVID, elective medical services.
Anthem’s benefit expense ratio – the percentage of premiums paid for medical services- was 85.6% in the first quarter, an increase of 140 basis points versus a year earlier.
However, operating revenue from Anthem’s pharmacy benefits management business, IngenioRx, jumped 12.8% to $5.86 billion, powering an 8.9% growth in operating revenue for the company.
Excluding items, Anthem earned $7.01 per share in the quarter ended March 31, compared with analysts’ average estimate of $6.51, according to Refinitiv IBES data.
(Reporting by Manojna Maddipatla in Bengaluru; Editing by Shinjini Ganguli)
