Recently, WellPoint Inc. (WLP) provided its financial outlook for fiscal 2010. The health insurer expects operating revenue of approximately $59.0 billion in fiscal 2010 as against $60.8 billion reported in 2009, down approximately 3%. The decline is primarily attributable to lower insured membership, among other factors.   The projection assumes that economic headwinds will continue to affect the company’s business throughout 2010. Specifically, the high unemployment level, which resulted in a 3.9% year-over-year decline in medical membership to 33.7 million in 2009, is expected to bring down medical membership further by 400,000 people in 2010.   The company projects operating cash flow of approximately $1.1 billion in 2010. The operating cash flow projection includes tax payments of $1.2 billion related to the sale of WellPoint’s NextRx pharmacy benefit management companies and an ...

One of the ideas that has come up in the Health Care debate is the idea of letting insurance companies compete across state lines. On the surface, this sounds like a good idea, since it will increase competition -- at least in theory. After all, most areas of the country already have extremely concentrated markets, with one or two firms getting over 75% of the premiums. As a result, the insurance companies are able to extract monopoly/oligopoly rents from the public. However, unless there is federal regulation of insurance, the plan will not work. Right now, the regulation of insurance is left to the states. Without any regulation, insurance is an open invitation to fraud. A company could simply collect the premiums and then when it came time to pay a claim, they could just say no. As it stands now, the national insurance companies like ...

WellPoint, Inc. (WLP) reported fourth quarter as well as full-year results for fiscal 2009.

The company earned $1.16 per share in the fourth quarter as opposed to $1.34 in the year-ago quarter. The Zacks Consensus Estimate for the quarter was $1.02. For the full-year 2009, Well Point earned $6.09 which was above the year-ago earnings of $5.48 and the Zacks Consensus Estimate of $5.91.

Total operating revenues for the quarter came in at approximately $15.1 billion as opposed to $15.4 billion in the year-ago quarter. The decrease was primarily attributable to lower fully insured enrollment in 2009, partially offset by the rise in premium rate. Total operating revenues for 2009 came in at approximately $60.83 billion as opposed to $61.58 billion in 2008.

Operating gains for the Commercial Business segment decreased 56.5% to $316.8 million in the reported quarter. The decline was due to restructuring costs incurred by WellPoint in addition to

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A series of corporate deal announcements and analyst upgrades of two Dow components returned to boost confidence on the Street and sent stocks sharply higher even as a controversial legislation to revamp the U.S. healthcare system inched closer toward finalization. 

The mergers and acquisition front witnessed a busy Monday as Bucyrus International (NASDAQ:BUCY) offered to buy the mining operations of Terex Corp. (NYSE:TEX) in a $1.3 billion all-cash deal.  Giving healthcare issues a major lift was Sanofi-Aventis’ (NYSE:SNY) announcement to acquire retail health products maker Chattem (NASDAQ:CHTT) in a $1.9 billion deal. 

Premarket futures suggest a higher opening on the Wall Street, even as Moody's Investor Services (NYSE:MCO) became the third rating agency to downgrade Greece's government bonds.  Dow Jones industrial average futures rose 29, or 0.3 percent, to 10,371. Standard & Poor's 500 index futures rose 3.50, or 0.3 percent, to 1,111.70, while Nasdaq 100 index futures rose

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Health Net (HNT) provided a strong outlook for 2010. The company expects earnings per share in the range of $2.30 to $2.40, higher than ours as well as the Street’s expectations. The guidance is based on the expectation that the pending sale of its Northeast businesses will close before year-end 2009. Following the better than expected earnings guidance for next year, Health Net’s shares touched a 52-week high of $23.79. Based on a flat membership growth compared to 2009, Health Net expects revenues in the range of $13- $13.5 billion.

We are pleased with the strong guidance, especially in a situation when high medical costs have forced Health Net to lower its 2009 outlook post third quarter results. The company now expects 2009 earnings per share in the range of $2.25 − $2.30 compared to the earlier guidance of $2.25 − $2.35. Although we were disappointed, we believe the

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Recently, WellPoint, Inc. (WLP) announced that its NextRx subsidiaries have been purchased by Express Scripts, Inc. (ESRX) for $4.675 billion, which includes the consideration for the value of a future tax benefit for the acquirer based on the transaction structure.  The deal provides for a 10-year agreement under which Express Scripts will provide the members of the health plans of WellPoint with pharmacy benefit management services, including home delivery and specialty pharmacy services. Both companies intend to leverage integrated medical and pharmacy data to drive innovation in the development and implementation of integrated health benefits.  The deal should improve health outcomes for members and bring down healthcare costs. Through this deal, WellPoint will look to improve the efficacy of its clinical competencies through the success of Consumerology, Express Scripts' application of the behavioral sciences, to aid members make better decisions related to healthcare.  Management ...

Recently, Rep. Alan Grayson (D-FL) quipped on the floor of the House that the GOP health care plan amounted to: "1) Don’t get sick, and 2) If you do get sick, die quickly." Yesterday, John Boehner (R-OH), the top GOP man in the House, finally unveiled the official GOP plan...and did little to disprove Rep. Grayson. The GOP plan would allow firms like WellPoint (WLP) and Aetna (AET) to continue to deny coverage based on pre-existing conditions. It would not offer any subsidies to the working poor to help them get covered, and would not require people to buy health insurance, or for employers to offer it. It would make it harder for people to sue if they are injured by medical malpractice. The use of contingency fees by lawyers in malpractice suits would be strictly limited. Thus, for example, if the doctor misread your ...

Express Scripts Inc. (ESRX) announced third-quarter earnings of 81 cents per share, in-line with the Zacks Consensus Estimate as well as last year's profit. Revenues, however, increased 3% to $5.6 billion with product revenues increasing 3.1% to $5.5 billion.   The company reports revenues from two segments: Pharmacy Business Management (PBM) and Emerging Markets (EM). PBM product revenue consists of revenues from the sale of prescription drugs by retail pharmacies in the company’s retail pharmacy networks and revenues from the dispensing of prescription drugs from the company’s home delivery and specialty pharmacies. EM product revenues consist of distribution of certain fertility drugs and revenues from drug distribution services.   PBM revenues increased 3.5% to $5.3 billion with network pharmacy revenues increasing by 3.4% mainly due to higher claims volume that were partially offset by price decreases. New clients contributed to the increase in claims volume. Meanwhile, generic fill rate increased to ...

• Visa (NYSE:V) reported earnings of 74 cents a share, 3 cents above Zacks estimates on revenues of $1.9 billion above estimates of $1.8 billion. The company expects 2010 revenue growth at the lower end of its 11-15% range, but 2011 growth above 20%

• International Paper (NYSE:IP) reported third quarter results of 37 cents a share, 14 cents above Zacks estimates, on inline revenues of $5.92 billion, off 13.1%. According to the company, at the end of its third quarter, "we began to see some modest improvements in demand in some segments of our paper and packaging businesses"

• Yahoo's (NASDAQ:YHOO) analyst meeting is due to be held at 11:00 ET

• Arcelor Mittal (NYSE:MT), the world's largest steel company, reported a $903 million third quarter profit, noting "We have seen the first signs of recovery in the third quarter...We should continue to see further gradual improvement through 2010, although the operating

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The mounting cost of health care may end up being the biggest single financial challenge faced this century, not only by America, but by most of the industrialized world. In spite of the many and varied approaches tried, it’s clear that no country has the issue fully resolved. Every mix of government and private administration, every attempt to balance the needs of the people with the needs of the medical industry, including doctors, hospitals, insurers, and biotechnology providers, comes up short.

Another thing is clear. By virtually any measure, the United States spends more on healthcare than any other country, over $2 trillion each year, roughly $10,000 per person. Moreover, there is no consensus on the reason for this, or what can be done about it. In the ongoing search for an answer, analysts and politicians have pointed the finger at a range of possible causes, including:

• The duplication of administrative

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