Mid Atlantic Medical Services, Inc. (MAMSI), the Rockville managed care insurer, yesterday posted earnings of $8.6 million for the quarter ended March 31, up 46.5 percent from the $5.9 million earned in the year-earlier quarter.
It was the fourth straight quarter of substantially improved earnings, after rocky performances from 1996 to 1998 led to a shakeup of top management.
Per-share earnings in the quarter were 22 cents, topping analysts' consensus estimates of 20 cents, and exceeding the 14 cents posted for the first quarter of 1999. The improvement in per-share profits reflected, in part, a stock buyback program that reduced the number of outstanding shares to 39.1 million, from 42.5 million a year earlier.
Although membership remained level, revenue was $360.1 million, up 15.0 percent from $313.2 million in the year-earlier quarter.
That was a function of premium increases. The average premium per member per month rose to $150.53, up 10.4 percent from a year earlier. At the same time, medical costs per member per month increased 9.0 percent, to $130.57, producing a larger margin.
As of the end of the quarter, MAMSI had 1.8 million members
"This is continuing good news for our shareholders and customers," said Dr. Mark D. Groban, MAMSI chairman.
Publicly traded HMOs have been improving their profitability as a group. Pulse, an industry newsletter, reported an average profit margin of 2.3 percent in the most recent quarter, nearly double the 1.2 percent average a year earlier. MAMSI's margin was 2.4 percent, placing it slightly ahead of the industry average.