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TAMPA -- WellCare Health Plans Inc.'s bottom line has taken a hit from the Affordable Care Act, but it's only temporary.
The Tampa-based company says it's responsible for $137.7 million in ACA industry fees in 2014, which contributed in part to a 36% jump in revenue year-over-year translating to a 64% drop in profit. The company tells investors, however, that expense is only temporary, as it expects its state Medicaid customers to reimburse those fees.
That fee is anticipated to jump as high as $235 million in 2015. Yet, once again, WellCare expects to be reimbursed.
However, the ACA wasn't the only thing affecting WellCare's profit.
WellCare's medical benefits expense jumped 39% to $11.5 billion, not only from increased membership in WellCare's insurance plans, but also higher medical and pharmacy costs.
WellCare also took on a $24.1 million impairment charge related to its 2012 acquisition of Easy Choice, and plans to exit Arizona.
In the end, WellCare — which trades on the New York Stock Exchange as WCG — reported a profit in 2014 of $63.7 million, or $1.45 per share, compared to a $174.8 million, or $4.03 per share, profit in 2013. Revenue was just under $13 billion in 2014, compared to $9.5 billion last year, according to filings with the U.S. Securities and Exchange Commission.
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