Aetna Raises Its 2010 Profit Projections

Aetna has invested hundreds of millions of dollars in its "data mining" capability to help reduce the medical costs of its members. The big question of course is this investment actually paying off? In an earlier post I mentioned that BC of California gained substantial business from Aetna in January because its promised savings in managing care were not realized. The known savings from the superior BC provider discounts trumped the supposed ones from Aetna's ability to better manage its medical costs.

Given this Aetna's announcement today of higher profitability was of interest. Part of the reason according to the press release was:

the company improved pricing and management of medical costs, said Fred Laberge, an Aetna spokesman, in a telephone interview. “It’s working with the data and the physician groups and the hospitals to have a better understanding of what to expect.”

I wonder how much of the changed forecast was due to improved pricing versus management of medical costs. Stay tuned for future announcements from Aetna on this.