Molina Healthcare Inc. reported a second-quarter adjusted net loss of $225 million, or $4.01 per share, compared with adjusted net income of $38 million, or 67 cents per share, in the year-ago quarter.
The S&P Capital IQ consensus normalized EPS estimate for the quarter was 87 cents.
The company's net loss was $230 million, or $4.10 per share, compared to net income of $33 million, or 58 cents per share, a year earlier.
On top of its restructuring plan, the company said it will take additional steps to improve profitability in 2018. Molina will exit the Utah and Wisconsin ACA Marketplaces effective Dec. 31. In its remaining marketplace plans, Molina is increasing 2018 premiums by 55% and reducing the scope of its 2018 participation in the Washington marketplace.
Molina recorded $43 million in restructuring and separation costs in the second quarter, related mostly to termination benefits paid to its former CEO and CFO.
The company's loss before income tax benefit rose by $78 million as a result of an increase to the premium deficiency reserve established for the marketplace program. The reserve, which was $22 million as of March 31, increased to $100 million as of June 30.
"Based upon revenue and cost trends observed in the second quarter of 2017, we now believe that Marketplace performance in the second half of 2017 will fall substantially short of previous expectations," the company stated in its earnings release. "Marketplace performance has been most disappointing in Florida, Utah, Washington, and Wisconsin."
The company recorded $72 million in noncash impairment losses for goodwill and intangibles, primarily related to its Pathways subsidiary.
Molina withdrew its previously stated, full-year 2017 EPS and adjusted EPS guidance because of its results for the most recent quarter and uncertain medical cost trends in Florida, Illinois, New Mexico and Puerto Rico health plans. The company said other reasons for revoking the guidance include uncertainty surrounding the funding of marketplace cost-sharing subsidies and potential variability in the timing of benefits achieved and costs incurred as a result of its restructuring plan.