US health insurers to see earnings, revenues fall sequentially in Q2

Industry analysts expect a decline in sequential revenue growth for a majority of the largest U.S. managed care companies despite year-over-year growth.

Revenues for all of the nine publicly traded U.S. managed care insurers are expected to be up year over year, while seven companies should see year over year increases in EPS, according to an S&P Global Market Intelligence examination of sell-side analyst forecasts.

Managed care companies are set for another positive quarter, according to a July 13 analyst note from Credit Suisse, as the companies saw lighter than expected utilization of services, particularly as it relates to COVID-19.

HealthEquity sole company expected to see sequential rise

Of the nine publicly traded U.S. managed care insurers, only HealthEquity Inc. and Alignment Healthcare Inc. are expected to see a year-over-year decrease in EPS.

Although HealthEquity's EPS is expected to fall year over year, it is expected to be the sole managed care company with a sequential rise in EPS. The company is also projected to see year-over-year revenue gains.

Alignment Healthcare is expected to see earnings declines on both sequential and yearly bases, though its revenue is expected to rise year over year.

*Read analyst predictions from the previous quarter. *Learn more about UnitedHealth's second-quarter earnings.

Revenues are projected to be up across the board on a year-over-year basis for insurers during the quarter. Most managed insurers are forecast to see declines in revenue sequentially.

UnitedHealth Group Inc. was the first of the major insurers to report its second-quarter revenue during an earnings call on July 15. Revenues were up year over year for the company, which also grew its customer base by 280,000 during the second quarter. CFO John Rex attributed the company's revenue in part to a rise in preventative care and annual care visits.

Although COVID-19 care has risen again in recent weeks, Rex said UnitedHealth has also reported a lower average length of stay compared with earlier periods.

Elevated revenue expected for Elevance

Only two insurers are expected to see a sequential increase in revenue: Cigna Corp. and Elevance Health Inc. Elevance was recently rebranded from Anthem Inc.

Elevance will be the second major managed care insurer to share its revenues during an earnings call on Wednesday.