The pandemic is now a "negative" for CVS
For every premium dollar that CVS Health's insurance arm, Aetna, collected in the second quarter, it paid a little more than 84 cents to medical providers — a "medical loss ratio" that was a lot higher than Wall Street expected.
The big picture: Health insurers were the main beneficiaries of the pandemic last year, as the widespread delay of doctor visits and procedures greatly offset what they had to pay for COVID-19 hospitalizations.
What to watch: Insurers typically pay out more in medical claims as the year drags on, because more people meet their deductibles and out-of-pocket maximums.
- Wall Street analysts expect CVS' medical loss ratio to reach 84.7% in the third quarter and 86.1% in the fourth quarter, according to FactSet.