Health Care

Coventry posts good first-quarter earnings

Coventry Health Care is working with Via Christi Health to develop a Medicare Advantage product that will be offered beginning in 2011, Coventry chairman and CEO Allen Wise said Friday.

During a conference call with investors and others, Wise said Coventry had a better-than-expected first quarter that included earnings of $97.3 million, compared to $44.1 million for the first quarter of 2009, and revenue of $2.9 billion. Earnings per share for the first quarter were 66 cents, compared to 30 cents for the same period a year ago.

Highlights of the first quarter included completing the acquisition of Preferred Health Systems, Wise said. Coventry bought PHS from Via Christi; the acquisition was completed Feb. 1.

"While it is still early in the year, I am pleased with our first quarter financial results particularly given the challenging macroeconomic operating environment," Wise said.

He said the first quarter's strength "was a bit unexpected" and "a very strong start" for the year.

Going forward, Wise said that Coventry was positioned for changes expected from health care reform and that the acquisition of PHS "has further strengthened our Midwest regional presence."

He said Coventry was working with Via Christi on a Medicare Advantage product "that is for the Via Christi system only. They have a huge amount of resources," including 26 physicians employed by the health system.

During his fourth-quarter earnings call, Wise said Coventry and Via Christi would begin discussions about a Medicare Advantage product. He said then that Coventry hoped to work with other organizations on similar products and "do some kind of profit-sharing with the facilities, so we're not fighting over per diems or not fighting over rates."

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