WellPoint Health’s Profit Rises to $71.2 Million

WellPoint Health Networks in Thousand Oaks said that first-quarter earnings rose 5.8% as it boosted premiums and membership.

Profit from operations rose to $71.2 million, or $1.04 a share, compared with profit from continuing operations of $67.2 million, or 95 cents a share, a year earlier.

WellPoint, the parent of Blue Cross of California, said it did well by keeping its premiums in line with rising medical costs.

WellPoint’s medical membership grew about 2.8% to 6.91 million from 6.73 million. The increase came from growth in California, the company’s biggest market. Revenue rose 12%, to $1.64 billion from $1.46 billion.

The company said medical costs chewed up 80.9 cents of every premium dollar. That’s up from 80.6 cents in the fourth quarter and down from 81.4 cents in the first quarter of 1998.

The company attributed the immediate increase to one-time payments it made in California to provide extra medical coverage for 118,000 WellPoint members insured through the California subsidiary of MedPartners Inc., a physician practice management group that went into bankruptcy protection.

WellPoint took a first-quarter charge of $20.6 million, or 30 cents a share. That made net income $71.1 million, or 74 cents a share.

In the same period last year, the company took a loss of $8.7 million, or 12 cents a share, from discontinued operations related to an unprofitable workers compensation business that it sold. That made net income $58.5 million, or 83 cents a share.