Metropolitan Health Networks Inc (MDF, Financial) filed Quarterly Report for the period ended 2010-03-31.
Metropolitan Health Networks Inc has a market cap of $119.9 million; its shares were traded at around $3.01 with a P/E ratio of 10 and P/S ratio of 0.3. MDF is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.
Despite the base premium rate reduction, our revenue increased to $93.0 million in the first quarter of 2010 from $90.4 million in the first quarter of 2009, an increase of $2.6 million or 2.9%. The average PCPM premium we received in the first quarter of 2010 was approximately $872 as compared to $857 for the first quarter of 2009, an increase of 1.7%. We believe this increase primarily reflects our continuing efforts to assure that our customers are properly diagnosed and assigned the appropriate Medicare risk score.
Operating expenses increased to $5.9 million in the first three months of 2010 as compared to $4.6 million for the same period in 2009, an increase of $1.3 million or 28.3%.
Premiums paid to us are retroactively adjusted based on the updated health status of our customers (known as a Medicare Risk Adjustment or “MRA”). We record an estimate of the retroactive MRA premium that we expect to receive in subsequent periods. Included in revenue in the first quarters of 2010 and 2009 is an estimate for retroactive premium payments related to that quarter of $4.1 million and $6.8 million, respectively. In July, 2009, we were notified by Humana that the actual retroactive premium adjustment for the first quarter of 2009 was $5.5 million. The $1.3 million difference reduced revenue in the second quarter of 2009. We expect to be notified of the actual 2010 first quarter retroactive premium adjustment in the summer of 2010.
Total medical expense was $76.0 million and $79.5 million for the first quarters of 2010 and 2009, respectively. Approximately $72.0 million or 94.7% of our total medical expense in the first quarter 2010 and $75.9 million or 95.5% of total medical expense in the first quarter of 2009 are attributable to direct medical services such as inpatient and outpatient services, pharmacy benefits and physician services by non-affiliated providers. The decrease in medical expense in the first quarter of 2010 was primarily due to, among other things, the decrease in certain benefits under Humana s Medicare Advantage plans in certain covered markets, the elimination of certain high cost special needs plans in certain of our counties, and the continued efforts of our medical management team to assure that proper medical care is provided to our customers.
At March 31, 2010, we determined that the range for estimated medical claims payable was between $24.6 million and $27.8 million and we recorded a liability of $26.1 million. Based on historical results, we believe that the actuarial mid-point of the range continues to be the best estimate within the range of the PSN s ultimate liability.
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Metropolitan Health Networks Inc has a market cap of $119.9 million; its shares were traded at around $3.01 with a P/E ratio of 10 and P/S ratio of 0.3. MDF is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.
Highlight of Business Operations:
Net income for the first quarter of 2010 was $7.1 million compared to $4.0 million in 2009, an increase of $3.1 million or 77.5%. Basic and diluted earnings per share were $0.18 and $0.17, respectively, for the first quarter of 2010 as compared to $0.09 and $0.08, respectively, for the same period in 2009.Despite the base premium rate reduction, our revenue increased to $93.0 million in the first quarter of 2010 from $90.4 million in the first quarter of 2009, an increase of $2.6 million or 2.9%. The average PCPM premium we received in the first quarter of 2010 was approximately $872 as compared to $857 for the first quarter of 2009, an increase of 1.7%. We believe this increase primarily reflects our continuing efforts to assure that our customers are properly diagnosed and assigned the appropriate Medicare risk score.
Operating expenses increased to $5.9 million in the first three months of 2010 as compared to $4.6 million for the same period in 2009, an increase of $1.3 million or 28.3%.
Premiums paid to us are retroactively adjusted based on the updated health status of our customers (known as a Medicare Risk Adjustment or “MRA”). We record an estimate of the retroactive MRA premium that we expect to receive in subsequent periods. Included in revenue in the first quarters of 2010 and 2009 is an estimate for retroactive premium payments related to that quarter of $4.1 million and $6.8 million, respectively. In July, 2009, we were notified by Humana that the actual retroactive premium adjustment for the first quarter of 2009 was $5.5 million. The $1.3 million difference reduced revenue in the second quarter of 2009. We expect to be notified of the actual 2010 first quarter retroactive premium adjustment in the summer of 2010.
Total medical expense was $76.0 million and $79.5 million for the first quarters of 2010 and 2009, respectively. Approximately $72.0 million or 94.7% of our total medical expense in the first quarter 2010 and $75.9 million or 95.5% of total medical expense in the first quarter of 2009 are attributable to direct medical services such as inpatient and outpatient services, pharmacy benefits and physician services by non-affiliated providers. The decrease in medical expense in the first quarter of 2010 was primarily due to, among other things, the decrease in certain benefits under Humana s Medicare Advantage plans in certain covered markets, the elimination of certain high cost special needs plans in certain of our counties, and the continued efforts of our medical management team to assure that proper medical care is provided to our customers.
At March 31, 2010, we determined that the range for estimated medical claims payable was between $24.6 million and $27.8 million and we recorded a liability of $26.1 million. Based on historical results, we believe that the actuarial mid-point of the range continues to be the best estimate within the range of the PSN s ultimate liability.
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