Shares of insurer Centene climb as Indiana renews state Medicaid contract

Centene shares climb as Indiana renews contract

INDIANAPOLIS — Shares of Centene Corp. climbed while broader indexes fell Friday, as the health insurer announced that it received a renewed contract to serve Indiana Medicaid customers.

THE SPARK: The St. Louis insurer said Indiana awarded a renewed and expanded managed care contract to serve both Hoosier Healthwise and Healthy Indiana Plan members starting Jan. 1.

Centene’s Managed Health Services subsidiary serves 211,400 people enrolled in Hoosier Healthwise, a program for children, pregnant women and low-income families. Healthy Indiana Plan is a medical savings account for uninsured adults who earn less than 200 percent of the federal poverty level.

THE BIG PICTURE: Centene is one of three companies awarded state contracts. The others are WellPoint Inc. and MDWise.

THE ANALYSIS: “We believe the potential to lose the entire contract was a headline risk for the company that is now removed and we expect the stock to see traction today on this favorable outcome,” Collins Stewart analyst Brian Wright said in a Friday research note.

SHARE ACTION: Up 73 cents, or 3.2 percent, to $23.55 in afternoon trading. In contrast, both the Standard & Poor’s 500 index and the Dow Jones industrial average fell more than 2 percent.