Health Insurer Centene Streamlines - Plans Massive Layoffs To Cut Costs: Report

Centene Corporation CNC is reportedly laying off about 3% of its workforce as the health insurer plans to cut expenditures and accelerate profits over the years.

The terminations will affect about 2,000 people, according to a report by Bloomberg, which cited a company spokesperson.

The company's expenses in the first six months of the year soared nearly 3% year over year to $74.11 billion. 

As of June 30, 2023, the company's total debt was $18.0 billion. 

The St. Louis, Missouri-based company has been selling its ancillary units to focus on managing government-sponsored health programs, including Affordable Care Act plans, the report added.

Centene is trying to improve quality ratings in its Medicare business, the report noted.

Adding to the woes, Centene is experiencing a decline in membership for its Medicaid plans as states reinstate eligibility restrictions that were lifted during the pandemic, Bloomberg added. 

However, the company had increased its 2023 premium and services revenue forecast range by $1.8 billion to reflect an additional $1 billion in Medicaid and Commercial premiums and $800 million for Medicaid state-directed payments.

Price Action: CNC closed lower by 0.82% to $69.99 on Tuesday.