Wellpoint is already a giant of the health care industry, providing insurance under the Blue Cross and Blue Shield brands in 13 US states. It has 34 million members, plus some dependents, totaling about 70 million people. The company's stock price has languished for a few years but it now looks ready for a rebound. Wall Street has generally applauded WellPoint's strategy of expanding its Medicare and Medicaid 

businesses while gearing up to attract more individual buyers, all in response to the Affordable Care Act.

 

The company has been a serial acquirer over the last couple of years, having bought 1-800 Contacts, a contact lens retailer, and CareMore, a provider of managed care for the elderly, but by far the biggest acquisition has been that of Amerigroup. This will significantly bolster its presence in the government financed markets of Medicaid for low-income individuals and Medicare for the elderly and disabled. WellPoint expects the deal to add to earnings beginning next year,adding more than $1 a share by 2015. WellPoint executives also said the acquisition made sense in light of the law’s creation of state exchanges, where low-income individuals are expected to be eligible for subsidies to help buy coverage in 2014.

 

In March, WellPoint appointed an experienced hospital executive to lead it through the sweeping changes created by the federal health care overhaul law -Joseph R. Swedish, the 61-year-old chief executive of a major nonprofit Catholic-owned health system, Trinity Health, is now WellPoint’s chief executive. He will be responsible for leading the company into the future. “It truly is a transformational period,” said Mr. Swedish, who helped build Trinity Health into a $9 billion health system with 47 hospitals in 10 states. 

 

WellPoint “has aggressively examined the marketplace,” he said, and is getting ready to compete for customers in highly regulated exchanges, where it must offer coverage even to people with serious medical conditions. WellPoint also bought a large insurer specializing in Medicaid, Amerigroup, last year, in its effort to adapt to the Affordable Care Act that expands the program. This latest appointment at Wellpoint has created a team uniquely qualified to manage all facets of the evolving health care system. The company seems well placed now for a rebound.

 

Wellpoint is one of the companies listed in the FTSE4Good index and has been recognised as one of the best companies in the US for hispanic workers. To qualify for inclusion in the FTSE4Good Index Series, companies must meet criteria requirements in five areas:

Working towards environmental sustainability

Developing positive relationships with stakeholders

Upholding and supporting universal human rights

Ensuring good supply chain labour standards

Countering bribery 

 

In 2012, the company, its foundation and associates directed millions of dollars and more than 14,000 hours to nonprofit organizations, events and programs working to address some of America's most pressing health needs. 

 

WellPoint’s charitable and community-focused activities are conducted through four primary channels: WellPoint Foundation grants; an annual Community Service Day; the WellPoint Associate Giving Campaign; and community sponsorships. Together, these activities total more than $47 million in current and ongoing community support. 

 

IBM is currently working with WellPoint and New York’s Memorial Sloan-Kettering Cancer Center to adapt the Watson computer, which beat humans in “Jeopardy!” in 2011, into three commercial products.

Watson will answer medical questions from doctors, researchers, medical centers and insurance carriers, the world’s largest computer-services company said today at an event in New York. 

By the end of 2013, 1,600 providers and 50% of nurses in the system of WellPoint, will be using a Watson product for recommending whether medical procedures should be approved, IBM said. 

 

Health care faces a challenge of “too much information, not enough time,” said Lori Beer, the executive vice president for IT at WellPoint. “Medical literature is doubling every five years. How do we keep up with that?” More Accuracy. WellPoint plans to make money by helping doctors make more accurate treatment decisions, reducing the time it has to spend pre-authorizing procedures and selling the product to other insurers, she said in an interview. 

 

WellPoint has recently been buying back stock and has announced an increase of approximately 30% to the shareholder dividend. The declared dividend for the first quarter of 2013 is $0.35 per share. This quarterly rate represents an annualized dividend of $1.50 per share, which equates to a yield of approximately 2.4% percent. The Company continues to expect a return of capital to shareholders

of approximately two billion dollars during 2013, between its share repurchase and dividend programs, subject to Company and market conditions. 

 

This company seems to have a healthly future ahead!

 Wellpoint  [NYSE:WLP]