WellPoint Inc. posted an 11 percent rise in second-quarter profit on Wednesday as the largest U.S. health insurer by enrollment increased its membership from a year earlier and better controlled administrative costs.
WellPoint also spent less on medical costs as a percentage of premiums than it did in the first quarter, which could soothe investors after rival UnitedHealth Group Inc.'s earnings report alarmed them in that regard.
Net income rose to $835.2 million, or $1.35 per share, from $751.2 million, or $1.17 per share, a year earlier. The results matched the analysts' average forecast, according to Reuters Estimates.
Revenue rose 7.7 percent to $15.3 billion.
Membership in WellPoint's health plans rose by 604,000 from a year ago to 34.8 million.
However, membership fell by 108,000 members from the first quarter, hurt by greater-than-expected declines in the company's national accounts business. WellPoint cited employee reductions in various industries, including the automobile, home building and mortgage sectors.
The company's benefit expense ratio -- the percentage of premium dollars spent on medical costs -- worsened to 81.8 percent from 81.2 percent a year earlier.
But the ratio, which is considered a key measure of profitability, improved from the 83.1 percent the company had reported for the first quarter.
WellPoint forecast full-year earnings of $5.55 per share, also in line with Wall Street's target.
WellPoint is looking to reassure investors about its direction after replacing its chief executive and chief financial officer in recent months.
Shares of the Indianapolis-based company have risen about 4 percent this year, roughly in line with the Morgan Stanley Healthcare Payor index.