Lincoln Pivots Toward Variable Annuity Sales: Earnings

Asset-based compensation held steady at about $36 million.

MetLife (NYSE:MET)

MetLife is reporting $68 million in net income for the second quarter on $14 billion in revenue, compared with $1.7 billion in net income on $17 billion in revenue for the second quarter of 2019.

The New York-based company’s results reflect a $710 million drop in the value of derivatives.

Operating earnings, which exclude the effects of the derivatives value change and some other charges and adjustments, fell to $758 million, from $1.3 billion.

U.S. group benefits unit is reporting $248 million in adjusted earnings for the latest quarter on $4.6 billion in premiums, fees and other revenues, compared with $311 million in adjusted earnings on $5 billion in premiums, fees and other revenues for the year-earlier quarter.

The retirement and income solutions unit is reporting $192 million in adjusted earnings for the latest quarter on $1.6 billion in premiums, fees and other revenues, compared with $351 million in adjusted earnings on $2.7 billion in premiums, fees and other revenues for the year-earlier quarter.

Voya Financial (NYSE:VOYA)

Voya is reporting a $71 million net loss for the second quarter on $1.7 billion in revenue, compared with $226 million in net income on $1.7 billion in revenue for the second quarter of 2019.

Adjusted operating earnings, which exclude the effects of $136 million of losses on operations Voya has discontinued, or is exiting, fell to $20 million, from $159 million.

Voya sells a large amount of group life and group disability coverage, through a unit that also offers medical stop-loss coverage, or insurance for employers’ self-insured health plans.

The ratio of claim costs to premiums for the benefits products fell to 69.3% in the latest quarter, from 71.6% in the year-earlier.

The company said it could end up with about $10 million to $20 million in COVID-19-related claims for every 100,000 increase in the number of U.S. COVID-19 deaths.

CVS Health (Aetna) (NYSE:CVS)

CVS is reporting $3 billion in net income for the second quarter on $65 billion in revenue, up from $1.9 billion in net income on $63 billion in revenue for the second quarter of 2019.

The Woonsocket, Rhode Island-based drug store company’s health care benefits unit, which now includes Aetna and some other operations, is reporting $3.5 billion in adjusted operating income for the latest quarter on $18 billion in revenue, compared with $1. billion in operating income on $17 billion in revenue for the year-earlier quarter.

CVS ended the quarter providing or administering coverage for 24 million people, up from 23 million people a year earlier.

CVS said that, because of a COVID-19-related reduction in use of routine care, its ratio of medical benefits costs to premiums plummeted to 70.3%, from 84% a year earlier.

Here’s how CVS health coverage utilization levels have compared with the year-earlier levels, starting in April:

• April: Down 30%
• March: Down 25%
• June: Done 5%
• July: Flat

Humana Inc. (NYSE:HUM)

Humana is reporting $1.8 billion in net income for the second quarter on $19 billion in revenue, compared with $940 million in net income on $16 billion in revenue for the second quarter of 2019.

The Louisville, Kentucky-based company ended the year providing or administering health coverage for 17 million people, up from 16.5 million people a year earlier.

Here’s what happened to seven types of health plan enrollment:

• Individual Medicare Advantage: 3.9 million (up from 3.5 million)
• Group Medicare Advantage: 608,300 (up from 519,100)
• Medicare supplement: 324,600 (up from 276,000)
• Fully insured employer plans: 820,800 (down from 942,500)
• Self-insured employer plans: 506,200 (up from 496,000)
• Military plans: 6 million (flat)

Humana said that, because of a COVID-19-related reduction in use of routine care, its ratio of medical benefits costs to premiums fell to 76.4%, from 84.4% a year earlier, even though it waived testing costs, eliminated Medicare Advantage plan enrollees’ out-of-pocket costs for use of telehealth services, and sent its enrollees face masks.

The company said it believes pent-up demand for care could make its medical loss ratio higher than normal for the rest of the year.

Triple-S Management Corp. (NYSE:GTS)

Triple-S — the San Juan, Puerto Rico-based Blue Cross and Blue Shield carrier for Puerto Rico, the U.S. Virgin Islands, the British Virgin Islands, Costa Rica and Anguilla  — is reporting $44 million in net income for the second quarter on $904 million in revenue, up from $31 million in net income on $886 million in revenue for the second quarter of 2019.

The company ended the quarter providing or administering medical coverage for about 932,000 people, up from about 930,000 a year earlier.

Here’s what happened to enrollment for some types of coverage between the second quarter of 2019 and the latest quarter:

• Medicare plans: 134,601 (up from 128,670)
• Medicaid plans: 364,157 (down from 364,495)
• Commercial plans: 433,471 (down from 436,407)

Triple-S said the COVID-19 social-distancing rules reduced overall use of medical care in its market area and cut the ratio of medical benefits costs to premiums to 79.4%, from 84.5% a year earlier.

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