INDIANAPOLIS (AP) — Anthem beat Wall Street's second-quarter earnings expectations as its profit grew nearly 10 percent, helped by government business and coverage the nation's second-largest health insurer sells to smaller employers.

The Blue Cross-Blue Shield insurer also said Wednesday that it raised its 2017 forecast. It now expects earning adjusted for one-time items to be greater than $11.70 per share this year after forecasting more than $11.60 per share in April.

Analysts polled by FactSet expect full-year earnings of $11.78 per share.

Anthem's medical enrollment edged up 1.6 percent in the quarter to top 40 million people, helped by gains from the insurer's Medicare and Medicaid business. The insurer has been jumping deeper into government business in recent years, as Medicare Advantage plans have grown nationally and states have expanded their Medicaid programs or turned more to insurers to help run coverage for the poor and people with disabilities.

In the second quarter, government business brought in $11.88 billion in operating revenue, which excludes investment gains. That amounted to more than half of the company's total.

Anthem's enrollment in its "local group" business also grew 3.4 percent in the quarter to 15.7 million people. That segment includes employer-sponsored coverage for companies with less than 5,000 people. This is generally a more profitable business for insurers like Anthem than larger clients who pay their own medical bills and hire an insurer to manage the coverage.

Enrollment in individual coverage fell nearly 2 percent to about 1.8 million people. That business includes coverage Anthem sells on the Affordable Care Act's insurance marketplaces. Anthem sells this coverage in several states, including key markets like California and New York. But the insurer has been scaling back that business too, announcing in recent months that it would leave marketplaces in Ohio, Wisconsin and its home state of Indiana for next year.

Overall, Indianapolis-based Anthem Inc.'s net income grew to $855.3 million from $780.6 million in the previous year's quarter.

Adjusted earnings totaled $3.37 per share, and operating revenue climbed 4.3 percent to $22.2 billion.

Analysts surveyed by Zacks Investment Research predicted earnings of $3.25 per share on $22.28 billion in revenue.

Shares of Anthem slipped $2.58 to $188 in premarket trading Wednesday.

The stock had climbed 33 percent since the beginning of the year.


Elements of this story were generated by Automated Insights ( using data from Zacks Investment Research. Access a Zacks stock report on ANTM at


Keywords: Anthem, Earnings Report