Feb. 05--Net profits from Cigna Corp. fell nearly 9 percent in the final quarter of 2015, from $467 million, or $1.77 per share at the end of 2014 to $426 million, or $1.64 a share.
The returns to investors were affected by $28 million in costs related to the pending merger with Anthem, which equaled 11 cents a share. The rest of the drop was from non-operational issues, such as investment performance.
In July, Anthem announced it would purchase Cigna for $48 billion, after weeks of resistance from the Bloomfield-based insurer.
Operating income for the quarter was $9.6 billion, up 8 percent from $8.9 billion a year ago.
Margins within operations were hurt by higher medical costs in individual health insurance plans and in government business, which includes Medicare Part D prescription coverage, Medicare and Medicaid. But Cigna said its specialty businesses, which include behavioral health and dental policy, and its commercial employer plans increased their margins.
At the end of 2015, Cigna had 13 million U.S. commercial medical plans, up 3 percent from a year earlier; 1.4 million international medical customers, up 11 percent; 502,000 Medicare Advantage customers, up 9 percent; and 65,000 Medicaid customers, up 10 percent. Medicare Part D prescription plans numbered 1.5 million, up 24 percent.
Last month, federal regulators announced Cigna could not sign up any new Medicare Advantage or Part D customers until it resolves persistent problems with service denials and unjustified restrictions on drug choices. That does not affect current customers.
Cigna's behavioral health plans numbered 24.7 million, up 3 percent; its dental customers were 13.9 million, up 2 percent; and commercial pharmaceutical plans were at 8 million, up 7 percent.
For 2016, Cigna forecast earnings of $8.85 to $9.25 a share, modestly below Thomson Reuters' projection of $9.30 a share.
Cigna and Anthem expect to be one company before the end of the year.
Cigna stock was trading at $133.77 in midday trading Thursday, up $1.27, or almost 1 percent.
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