Centene
Annual Report 2013

Plain-text annual report

REACHING FOR THE SUMMIT 2013 Annual Review TRANSFORMING THE HEALTH OF THE COMMUNITY, ONE PERSON AT A TIME centene corporation Annual Review 2013Centene Corporation is a leading multi-line healthcare enterprise that provides programs and related services to address the needs of under-insured and uninsured individuals. Centene offers unique, cost-effective coverage solutions for low-income populations through locally based health plans and a wide range of specialty services. TABLE OF CONTENTS 2013 at a Glance 1 Letter from the Chairman 2 Company and Financial Summary 6 Nationwide Presence 7 2013 Highlights 8 Focused on the Individual 10 Whole Health is Everything 12 We're Right Here 14 Helping to Create Healthier Communities 16 Awards and Recognition 17 Quarterly Selected Financial Information 18 Selected Financial Information 19 Corporate Information 20 centene corporation Annual Review 2013Centene is living its purpose — transforming the health of the community, one individual at a time — everyday. We leverage the strength of our purpose and our three brand pillars to galvanize our growing base of nearly 9 thousand employees nationwide and achieve remarkable results. 2013 at a Glance 2.7 Million At-risk Managed Care Membership Current States with At-risk Managed Care Membership 20 $10.5 Billion Premium and Service Revenues from Continuing Operations Million in Total Operating Cash Flow $382.5 2,000 Jobs Added in 2013 Stock Price Growth in 2013 43.8% centene corporation Annual Review 2013 LETTER FROM THE CHAIRMAN Michael F. Neidorff Chairman, President and Chief Executive Officer The year 2013 was one of vast change and transformation in the healthcare industry. As the nation tackled the challenges associated with implementing the Affordable Care Act, Centene was able to maintain its strong footing and successfully deliver on our strategy, growing premium and service revenues from continuing operations 37 percent from 2012 to $10.5 billion. Earnings from continuing operations increased to $277.4 million, or 157 percent, over 2012. We now coordinate care for more than 2.7 million at-risk managed care members in 20 states. While these statistics demonstrate tremendous financial success for Centene, the numbers alone do not display the true value of what we bring to the market. centene corporation Annual Review 2013Through a diversified product portfolio and expanded geographic reach, Centene continued to deliver results for our state partners and other customers by maintaining focus on our company's purpose: transforming the health of our community, one individual at a time. This singular purpose is what drives each of our 8,800 employees across the country to provide local, coordinated care and support services centered on the whole health of the individuals we serve. In 2013, this focus was evidenced by our organic growth within our existing states, new Medicaid contracts, new contract awards in the correctional healthcare services arena, key acquisitions to enhance our medical management platform, and preparation for entrance into Health Insurance Marketplaces in nine states in 2014. 37% YEAR-OVER-YEAR INCREASE IN TOTAL PREMIUM AND SERVICE REVENUES FROM CONTINUING OPERATIONS $10.5 B $7.7 B 3 Centene continued to deliver results by maintaining focus on its purpose. First, I would like to focus on our organic growth within the states where we have business. This has been a key strategy for Centene – enter a state under a single managed care contract, prove our value to our state customers, and expand our services to other populations within that state. We believe as our state partners continue to move additional populations, such as those with complex care needs, into managed care programs, Centene’s multi-state footprint coupled with our integrated approach to care have positioned us well for organic growth in these markets. I would like to highlight a few examples of the kind of organic growth we experienced this year. Centene’s Florida subsidiary, Sunshine Health, was selected to serve Long Term Care members in 10 regions in Florida; our Texas subsidiary, Superior HealthPlan, expanded its STAR+PLUS contract serving older adults and people with disabilities; and our South Carolina subsidiary was selected to serve members eligible for both Medicaid and Medicare (Dual Eligibles). Sunshine Health was also selected for the Managed Medical Assistance (MMA) program in nine regions, and Centene’s Massachusetts’s health plan, CeltiCare LETTER FROM THE CHAIRMAN (CONTINUED) Health, expanded its reach with a new Medicaid contract in five regions. In addition to the growth Centene experienced in existing markets, we also continued our geographic expansion with entry into Kansas, California and New Hampshire through new Medicaid managed care contracts. Also in 2013, we further expanded our product portfolio through a new market opportunity in the correctional healthcare services arena. Centene entered the correctional healthcare services arena through a joint venture with MHM Services, a national leader in providing healthcare services to correctional systems. The joint venture company, Centurion, leverages Centene’s nearly 30 years of experience with state- sponsored managed care programs and MHM’s unique expertise in providing healthcare services to inmates. During 2013, Centurion won contracts in Massachusetts, Tennessee and Minnesota. Centene understands that, along with this rapid growth, we need to expand our capabilities to ensure we are continuing to provide the best care possible for our diverse member base. As we continue to serve more members with complex healthcare needs, such as the Aged, Blind and Disabled, Dual Eligibles and those receiving Long Term Care services, we aim to provide a continuum of high quality healthcare services that allows us to effectively manage the complex needs of these members. Centene currently serves more than 300,000 high-acuity members in 13 states. To that end, early in 2013, we acquired AcariaHealth, a comprehensive specialty pharmacy company, improving how pharmaceutical benefits are delivered to our members with complex conditions. In early 2014, Centene acquired a majority interest in U.S. Medical Management (USMM), a leading management services organization and provider of in-home health services for high acuity populations. In conjunction with the investment in USMM, Centene announced the formation of a new healthcare enterprise holding company. This new business unit is expected to connect Centene with other health solution providers while preserving the entrepreneurial spirit and innovation that has led to improved health outcomes, development of a more efficient care model and the facilitation of sales to third party companies. centene corporation Annual Review 20135 disciplined approach to pricing across all states. I am proud of the hard work and dedication our employees put into this new opportunity for Centene. The Health Insurance Marketplaces are only one part of our overall growth pipeline, as you have seen from the many other accomplishments and milestones we achieved this year. In closing, as we enter 2014, we also enter a new era of healthcare. We believe we are in a strong position to benefit from the significant market opportunities that lie ahead. Most importantly, millions of Americans are counting on Centene to continue delivering the comprehensive, quality healthcare that has become our trademark for the past 30 years. Sincerely, MICHAEL F. NEIDORFF Chairman, President and Chief Executive Officer Centene Corporation NEW ENTERPRISE STRUCTURE TO SUPPORT INNOVATION SM Along with these enhanced capabilities, Centene announced the acquisition of a majority stake in Fidelis SecureCare of Michigan, expected to close in late 2014. Fidelis SecureCare was recently selected by the Michigan Department of Community Health as one of six health plans to provide integrated healthcare services to Dual Eligibles in Macomb and Wayne counties. At the beginning of 2013, the healthcare industry was preparing for the implementation of the Affordable Care Act. Centene worked diligently to meet the necessary regulatory and operational requirements. In January 2014, we began providing healthcare services under the name Ambetter on the newly formed Health Insurance Marketplaces in nine states. We maintained a consistent, COMPANY AND FINANCIAL SUMMARY FINANCIAL HIGHLIGHTS FROM CONTINUING OPERATIONS in thousands Premium and Service Revenues Earnings from Operations 2013 2012 2011 2010 2009 $ 10,526,040 $ 7,681,631 $ 5,051,902 $ 4,283,833 $ 3,878,283 277,417 107,966  203,803 157,069 138,135 Net Earnings (1)  161,218  88,533 120,518 90,947 86,093 Total Assets 3,413,483 2,534,612 2,092,530 1,937,852 1,668,772 (1) Attributable to Centene Corporation PREMIUM AND SERVICE REVENUES in millions EARNINGS FROM OPERATIONS in millions AT-RISK MEMBERSHIP in thousands 6 2 5 , 0 1 2 8 6 , 7 2 5 0 , 5 4 8 2 , 4 $10,000 $8,000 $6,000 $4,000 $2,000 8 7 8 , 3 0 $300 $225 $150 $75 0 7 7 2 $ 4 0 2 $ 7 5 1 $ 8 3 1 $ 8 0 1 $ 3,000 2,250 1,500 750 0 3 2 7 , 5 2 2 4 , 2 5 3 6 , 1 8 5 4 , 1 4 3 5 , 1 ‘09 ‘10 ‘11 ‘12 ‘13 ‘09 ‘10 ‘11 ‘12 ‘13 ‘09 ‘10 ‘11 ‘12 ‘13 centene corporation Annual Review 2013NATIONWIDE PRESENCE 7 Medicaid/CHIP ABD Foster Care Medicare SNP Dual Eligibles Correctional Healthcare Health Insurance Marketplace Long Term Care embed in contract GROUP AND PRODUCT SOLUTIONS BY STATE ARIZONA Medicare SNP Long Term Care ARKANSAS Medicaid Health Insurance Marketplace CALIFORNIA Medicaid CHIP ABD FLORIDA Medicaid CHIP ABD Foster Care Medicare SNP Health Insurance Marketplace Long Term Care GEORGIA Medicaid CHIP Medicare SNP Health Insurance Marketplace ILLINOIS ABD Dual Eligibles (1) Long Term Care INDIANA Medicaid CHIP Health Insurance Marketplace MISSOURI Medicaid CHIP Foster Care KANSAS Medicaid CHIP ABD Foster Care Long Term Care LOUISIANA Medicaid CHIP ABD Foster Care MASSACHUSETTS Medicaid Expansion Correctional Healthcare Health Insurance Marketplace MINNESOTA Correctional Healthcare MISSISSIPPI Medicaid ABD Foster Care Health Insurance Marketplace NEW HAMPSHIRE Medicaid CHIP ABD Foster Care OHIO Medicaid CHIP ABD Medicare SNP Dual Eligibles (1) Health Insurance Marketplace SOUTH CAROLINA Medicaid CHIP ABD Dual Eligibles (1) TENNESSEE Correctional Healthcare (1) Operations expected to commence in 2014 TEXAS Medicaid CHIP ABD Foster Care Medicare SNP Health Insurance Marketplace WASHINGTON Medicaid CHIP ABD Foster Care Health Insurance Marketplace WISCONSIN Medicaid CHIP ABD Medicare SNP 2013 HIGHLIGHTS Florida subsidiary selected to serve Long Term Care members in 10 regions in Florida. Florida subsidiary awarded commendable accreditation rating by NCQA. Centene received notice of intent to award California Medicaid contract to serve members under the state’s Medi-Cal Managed Care Rural Expansion program. Centene Corporation completes acquisition of specialty pharmacy leader AcariaHealth, one of the nation’s largest, independent, comprehensive specialty pharmacy companies. Ohio subsidiary awarded commendable accreditation rating from the NCQA. Centene climbs higher in 2013 Fortune 500 ranking to #303, up 150 places from the previous year’s ranking. Centene partners with MHM Services to serve Massachusetts State Correctional System via ongoing joint venture between Centene and MHM Services, called Centurion. Centene earns national recognition for innovative member programs. Honored for five of these programs at the Fourth Annual Case in Point Platinum Awards. Q1 Centurion selected to provide correctional healthcare in Tennessee, via ongoing joint venture between Centene and MHM Services. Q2 centene corporation Annual Review 20139 Florida subsidiary begins operating under a contract with the Florida Agency for Health Care Administration to serve members of the Medicaid Managed Care Long Term Care program. Centene launches innovative leadership program, a partnership between Centene, Trinity University of San Antonio, Texas, and Washington University in St. Louis. Moody’s investor service affirms Centene's senior debt rating of Ba2 and raises outlook of the company to stable. Centene’s medical triage and health education outreach company, NurseWise, receives full core and health call center accreditation from URAC. Centene’s Texas subsidiary awarded contract to expand STAR+PLUS service. Centurion selected to provide correctional healthcare in Minnesota. Centene’s Massachusetts subsidiary awarded Medicaid contract in all five state regions. Centene and Cenpatico partner with Children’s National Health System to fight bullying. Florida Medicaid announces intent to award contracts for the Managed Medical Assistance (MMA) program in nine regions and statewide Foster Care contract to Centene subsidiary. Centene’s South Carolina subsidiary selected to serve dual-eligible members, as part of the state’s pilot program to provide integrated and coordinated care for individuals who are eligible for both Medicare and Medicaid. Centene’s Wisconsin and South Carolina subsidiaries awarded commendable accreditation ratings by NCQA. Q4 Q3 centene corporation Annual Review 2013 FOCUSED ON THE INDIVIDUAL Yesterday, healthcare was defined by what happened when you got sick. Today, healthcare is about keeping you healthy. We believe that healthcare coverage can be about more than paying physicians; it’s about community wellness and health education. It’s about getting ahead of infirmity instead of struggling to get out from under it. We know that illness is an inevitable part of life, and we are always there to help our members receive the right care at the right place and at the right time to help them get better. Since we understand that healthcare is not one size fits all, we take a personal approach in tending to each member's unique qualities and circumstances. We also recognize that it’s the choices individuals make when doing well that helps prevent illness or manage chronic conditions, so we provide the information, technology, and tools to help our members stay healthy. We do all of this because we believe that health is the key; it is the building block that allows us to focus on everything that makes our lives better, and so our ultimate goal is to help our members live healthy lives. Focus on Individuals Whole Health Active Local Involvement centene corporation Annual Review 201311 BETTER HEALTH OUTCOMES The Start Smart For Your Baby© (SSFB) Texting Program is a component of our comprehensive SSFB Care Management program and aims to improve maternal and infant health by providing timely health information, resources, and reminders to members during pregnancy and continuing six months postpartum. The goals of the program are to improve prenatal and postpartum visit compliance, as well as promote breastfeeding in our members. PERCENTAGES OF IMPROVEMENT IN PRENATAL AND POSTPARTUM COMPLIANCE 90+ day enrollment PERCENTAGES OF BREASTFEEDING MOTHERS % 6 . 6 % 8 . 6 % 2 . 3 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% % 9 . 9 8 % 8 . 6 6 Control Group (21-30 Days Post Delivery) SSFB Texting Program Members (21 Days Post Delivery) % 5 . 0 5 % 8 . 4 3 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Frequency of Ongoing Prenatal Care Timeliness of Prenatal Care Postpartum Visit Rate Any Breastfeeding Exclusive Breastfeeding CENTENE IN ACTION A 37-year-old farm worker suffered from a history of asthma and depended on frequent visits to the ER for medical attention. Compounding his condition were untreated depression and fluctuations in Medicaid eligibility due to income irregularity. These created additional barriers between him and control of his health. This is where Centene steps in. Our health plan case manager conducts home visits with the member, compiles background information with the help of a primary care physician, and coordinates a treatment plan with our wellness and disease management company. A health coach assists the member in accessing resources to help him remain medically compliant. Simultaneously, our behavioral health nurse addresses the untreated depression, while Centene’s health information systems monitor progress and alert us of any change in his Medicaid eligibility status. One month after seeing a pulmonologist, his asthma symptoms were in much better control without any nighttime awakening or wheezing. He also has learned to avoid some environmental triggers of his asthma with assistance from his health coach. centene corporation Annual Review 2013 WHOLE HEALTH IS EVERYTHING Keeping people healthy requires thinking outside the bounds of traditional healthcare. Whole Health represents all the ways we can improve the lives of the people we touch. Whole Health is everything. It’s what we stand for and have stood for since our beginning. Whole Health is local and individual, it’s the family and the community. It means that not only the doctor and the nurse, but also the educator, the parent, and the employer are all part of the healthcare system. Whole Health understands the value of helping others lower stress, and that lower stress means better health. It recognizes that when children have an opportunity to succeed, we all feel better. Whole Health recognizes that when it comes to health, everything matters. And so we look for ways, big and small, to improve the lives of our members. Whole Health does not promise that we can serve every need or solve every problem. It is an awareness that when it comes to improving the health of our members, nothing should be ignored. Focus on Individuals Whole Health Active Local Involvement centene corporation Annual Review 2013BETTER HEALTH OUTCOMES 13 Sickle Cell Disease is a chronic and often life threatening condition that, despite recent advancements in treatment, is still associated with a high utilization of medical resources, decreased life expectancy, and reduced quality of life. In response, Centene has developed an innovative “My Route to Health Sickle Cell Program” aimed at improving health outcomes of our members affected by sickle cell disease through community-based, culturally-sensitive initiatives. One of the primary goals of “My Route to Health Sickle Cell Program” is to increase hydroxyurea utilization, which can lead to a reduction of inpatient hospitalization for pain, fewer instances of acute chest syndrome, lessened severity of anemia, and decreased need for transfusions. UTILIZATION IN SICKLE CELL MEMBER POPULATION hydroxyurea fills per 1,000 member months SICKLE CELL RELATED ER VISITS per 1,000 member months 0 . 3 7 0 . 3 6 9 . 8 4 70 60 50 40 30 20 10 0 150 125 100 75 50 25 0 7 . 8 3 1 9 . 0 3 1 9 . 7 0 1 2011 2012 2013 2011 2012 2013 CENTENE IN ACTION A 60-year old homeless man who is wheelchair-bound suffered from oxygen-dependent chronic obstructive pulmonary disease (COPD) and cellulitis on his legs. Despite numerous hospitalizations over the past six years, he was reluctant to go to the doctor or proactively seek medical care. Lack of financial resources as well as poor nutrition and social support compounded his reluctance and created additional barriers for him in managing his COPD. After another hospital admission, Centene’s integrated care team stepped in to provide housing assistance, support provisions and follow-up to ensure he was receiving the medical care he needs. He was successfully transferred from the hospital setting to a skilled nursing facility and eventually to home. His physical activity increased being able only to walk 10 steps to walking 70-80 steps and climbing 15 stairs before experiencing shortness of breath. He works closely with his integrated care team, and is no longer hesitant about medical appointments. He refills his prescriptions regularly, visits his primary care physician as scheduled and has not been readmitted to the hospital. centene corporation Annual Review 2013 WE’RE RIGHT HERE Quality healthcare requires a local approach. Maintaining good long-term health relies on more than just one person; it takes a community of caring. From a mother’s loving touch, to a nurse’s ability to listen, or a doctor’s insightful treatment, a local touch is key to the best health outcomes. We are part of the community that cares for, and about, individuals. We’re right here. Our employees live in the same state as our members, drive on the same roads, and have a vested interest in the continued improvement of their community. Because we’re right here, we are better able to know the needs of our members and achieve the goal of better health outcomes at lower costs. We’re right here because from our company’s founding, we have understood the power of showing up, of being local, of being present. This is more than a philosophy; it’s our approach to everything we do. It means that we are available for our members when they need someone to be there; and it means that we belong. We’re right here. Focus on Individuals Whole Health Active Local Involvement centene corporation Annual Review 201315 BETTER HEALTH OUTCOMES The Fluvention® campaign is an initiative aimed at educating, encouraging, and coordinating access for annual flu vaccinations. Using an integrated approach, Fluvention targets individuals, inter-personal relationships, communities, organizations, and policies to increase overall influenza vaccination rates. Fluvention leverages the dynamic relationship a member has within his or her community to get the best outcomes possible. During the 2013 flu season (Q4 2012- Q1 2013), the flu vaccination rate for all of Centene’s health plans combined was 22.5%, which showed a statistically significant increase from the previous year. FLU SEASON VACCINATION RATES ACROSS HEALTH PLANS 25% 20% 15% 10% 5% 0% % 5 . 2 2 % 2 . 8 1 % 6 . 9 1 % 9 . 8 1 2010 2011 2012 2013 CENTENE IN ACTION Centene knows that social factors play a significant role in the health of our members, especially among the children we serve. That is why Centene and Cenpatico teamed up with Children’s National Health System in 2013 on a campaign to prevent bullying among school-aged children, which kicked off during National Anti-Bullying Month in October. Through Centene’s established “Adopt a School” program and other community resources, the organizations are hosting a series of events to educate students, teachers and parents on how to prevent, identify and appropriately intervene when bullying threatens school-aged children. The “No Bullying Zone” events feature renowned children’s author Michelle Bain, reading a new anti- bullying book called Splotch the Madpole which was co-authored with Centene, Cenpatico and anti- bullying expert Dr. Joseph Wright of Children’s National Health System. In addition, students have the opportunity to add positive messages about their family, friends and school to an anti-bullying graffiti wall that will travel around the country for a year. HELPING TO CREATE HEALTHIER COMMUNITIES Two key components of Centene are integral to our successes in transforming the health of our communities, one individual at a time. Our proprietary information technology systems and on-the-ground, personal outreach programs jointly deliver impactful insights and actions — helping us fulfill our purpose every day. INFORMATION TECHNOLOGY Centene's Information Technology systems provide insight into the behaviors of our members and providers. Through our proprietary enterprise platform, Centelligence™, we are able to integrate data from multiple sources, and access actionable population and member level information, with the ultimate goal of improving clinical, operational, and financial outcomes. Centelligence integrates information from all of our IT applications, as well as external systems, to produce actionable information. Central to Centene’s clinical management programs is TruCare, a member-centric health management platform for collaborative care coordination. TruCare integrates data from case management, behavioral health, disease management and utilization management processes so our staff can look at the whole health of the individuals we serve. The system is critical to the collaboration between Centene and Cenpatico in providing integrated clinical management programs for our high-risk members. OUTREACH AND EDUCATION PROGRAMS MemberConnections is face-to-face community outreach and education program designed to create a link between the member and the provider. MemberConnections representatives contact new members to discuss managed care, the Medicaid program and our services. Representatives make home visits, conduct educational programs and represent our health plans at community events. They also coordinate the “Adopt a School” program, where an award-winning author conducts book readings in local schools on health-related topics. Through the ConnectionsPlus® program members can receive access to a reliable, preprogrammed cell phone. This program eliminates a barrier to coordinating care by providing continuous access to a telephone, thus reducing avoidable events including inappropriate emergency room utilization, hospital admissions and premature birth. Originally designed for pregnant women and ABD populations, this program has now been expanded to serve high-risk members with mental health issues, and specific diseases in all of our health plans. centene corporation Annual Review 2013AWARDS AND RECOGNITION 17 2013 CASE-IN-POINT PLATINUM AWARDS 2013 HERMES AWARDS (FOR BOOK SERIES) ER Department ED Cost Avoidance in Pediatric Medicaid Recipients, NurseResponse Medicaid Case Management My Route to Health Sickle Cell Program, Centene Corp Pediatric Case Management Complex Case Management in Foster Care, Cenpatico Women/Children Case Management Start Smart for Your Baby, Centene Corp Women/Children Case Management Healthy Start Newborn & Women Program, Peach State Health Plan 2013 WEB HEALTH AWARDS 2013 Web Health Awards Bronze Award Winner, On Target with Your Asthma, Audio 2013 Web Health Awards Merit Award Winner, Listening to Your Heart, Matters, Audio 2013 Web Health Awards Merit Award Winner, Living Well with Sickle Cell, Audio 2013 Web Health Awards Merit Award Winner, Off The Chain, Audio A Foster Care Journey Honorable Mention The Madpole Does A Whole Lot Of Bullying Platinum Body Well, Baby Well Gold "Dad: Little Word, Big Deal" Honorable Mention Listening to Your Heart, Matters! Platinum Off The Chain Teen Pregnancy Platinum My Route to Health-On Target with Your Asthma Gold START SMART FOR YOUR BABY 2013 ClearMark Merit Award Winner Start Smart for Your Baby – A Guide to Your Baby’s Care – The First Year CENPATICO 2013 Greater Austin Business Awards Higginbotham Health & Wellness Award 16K+ Home visits conducted, including home visits for new, high-acuity members 8.7K+ ConnectionsPlus® phones issued to high-risk members since program inception in December 2006 Adopt-a-School Program ● 15 book readings with renowned children's author Michelle Bain ● over 2,500 students reached ● 22 adopted schools as of 2013 255,691 text messages sent out to pregnant members QUARTERLY SELECTED FINANCIAL INFORMATION FROM CONTINUING OPERATIONS (UNAUDITED) (in thousands, except share data and membership data) Total revenues Net earnings attributable to Centene Corporation Net earnings per share attributable to Centene Corporation: Basic earnings per common share Diluted earnings per common share Health Benefits Ratio General & Administrative Expense Ratio Period end at-risk membership $ $ $ $ (in thousands, except share data and membership data) Total revenues Net earnings (loss) attributable to Centene Corporation Net earnings per share attributable to Centene Corporation: Basic earnings (loss) per common share Diluted earnings (loss) per common share Health Benefits Ratio General & Administrative Expense Ratio Period end at-risk membership $ $ $ $ For the Quarter Ended, 2013 March 31 2,525,482 22,639 0.43 0.41 90.2% 8.4% 2,553,400 June 30 September 30 December 31 $ $ $ $ $ $ $ $ 2,610,538 40,289 0.74 0.71 88.4% 8.9% 2,563,400 2,795,569 50,325 0.92 0.88 87.8% 9.1% 2,612,500 $ $ $ $ 2,931,740 47,965 0.87 0.84 88.1% 8.9% 2,723,200 For the Quarter Ended, 2012 March 31 1,562,809 27,072 0.53 0.51 87.1% 10.4% 2,003,800 June 30 September 30 December 31 $ $ $ $ $ $ $ $ 1,967,362 (16,656 (0.32 (0.32 91.2% 8.5% 2,254,000 2,308,075 59,438 $ 2,272,050 18,679 $ 1.15 1.10 88.7% 8.4% 2,357,600 $ $ 0.36 0.35 90.7% 8.4% 2,424,500 centene corporation Annual Review 2013 SELECTED FINANCIAL INFORMATION (in thousands, except share data) Revenues: Premium Service Premium and service revenues Premium tax Total revenues Expenses: Medical costs Cost of services General and administrative expenses Premium tax expense Impairment loss Total operating expenses Earnings from operations Other income (expense): Investment and other income Debt extinguishment costs Interest expense Earnings from continuing operations before income tax expense Income tax expense Earnings from continuing operations, net of income tax expense Discontinued operations, net of income tax 19 Year Ended December 31, 2013 2012 2011 2010 2009 $ 10,153,460 $ 7,568,889 $ 4,498,137 $ 4,192,172 $ 3,786,525 91,758 3,878,283 224,581 4,102,864 103,765 5,051,902 159,575 5,211,477 91,661 4,283,833 164,490 4,448,323 372,580 10,526,040 337,289 10,863,329 112,742 7,681,631 428,665 8,110,296 8,994,641 326,924 931,137 333,210 — 10,585,912 277,417 6,781,081 87,705 667,157 428,354 28,003 8,002,330 107,966 4,191,268 78,114 577,898 160,394 — 5,007,674 203,803 3,584,452 63,919 477,765 165,118 — 4,291,254 157,069 3,230,131 60,789 447,921 225,888 — 3,964,729 138,135 18,457 — (26,957 268,917 107,080 35,285 — (20,460 122,791 47,412 13,355 (8,488 (20,320 188,350 70,687 15,205 — (17,992 154,282 59,900 15,691 — (16,318 137,508 48,841 161,837 75,379 117,663 94,382 88,667 expense (benefit) of $2,284, ($47,741), ($4,165), $4,388, and ($1,204), respectively Net earnings (loss) Noncontrolling interest Net earnings attributable to Centene Corporation $ 3,881 165,718 619 165,099 $ (86,674 (11,295 (13,154 1,859 $ (9,300 108,363 (2,855 111,218 $ 3,889 98,271 3,435 94,836 $ (2,422 86,245 2,574 83,671 Amounts attributable to Centene Corporation common shareholders Earnings from continuing operations, net of income tax expense Discontinued operations, net of income tax expense (benefit) Net earnings Net earnings (loss) per common share attributable to Centene Corporation: Basic: Continuing operations Discontinued operations Basic earnings per common share Diluted: Continuing operations Discontinued operations Diluted earnings per common share Weighted average number of common shares outstanding: Basic Diluted Consolidated Balance Sheet Data From Continuing Operations: Cash and cash equivalents Investments and restricted deposits Total assests Medical claims liability Long term debt Total stockholders' equity $ 161,218 $ 88,533 $ 120,518 $ 90,947 $ 86,093 3,881 165,099 $ (86,674 1,859 $ (9,300 111,218 $ 3,889 94,836 $ (2,422 83,671 2.98 $ 0.07 3.05 $ 2.87 $ 0.07 2.94 $ 1.72 $ (1.68 0.04 $ 1.65 $ (1.62 0.03 $ 7.40 $ (0.18 2.22 $ 2.30 $ (0.18 2.12 $ 1.87 $ 0.08 1.95 $ 1.80 $ 0.08 1.88 $ 2.00 (0.06 1.94 1.94 (0.05 1.89 $ $ $ $ $ 54,126,545 56,247,173 51,509,366 53,714,375 50,198,954 52,474,238 48,754,947 50,447,888 43,034,791 44,316,467 December 31, 2013 2012 2011 2010 2009 $ 974,304 $ 940,972 3,413,483 1,111,709 665,697 1,243,439 745,933 $ 727,157 2,534,612 815,161 535,481 953,767 493,532 $ 652,992 2,092,530 518,840 348,344 936,419 433,914 $ 639,983 1,937,852 456,765 327,824 797,055 400,951 585,183 1,668,772 470,932 307,085 619,427 CORPORATE INFORMATION The graph below compares the cumulative total stockholder return on our common stock for the period from December 31, 2008 to December 31, 2013 with the cumulative total return of the New York Stock Exchange Composite Index and the Standard & Poor's Supercomposite Managed Healthcare Index over the same period. The graph assumes an investment of $100 on December 31, 2008 in our common stock (at the last reported sale price on such day), the New York Stock Exchange Composite Index and the Standard & Poor's Supercomposite Managed Healthcare Index and assumes the reinvestment of any dividends. In prior years, the Company used the Morgan Stanley Healthcare Payor Index, which was discontinued in October 2013. Centene Corporation New York Stock Exchange Composite Index S&P Supercomposite Managed HealthCare Index STOCK PERFORMANCE GRAPH dollars 300 250 200 150 100 2008 2009 2010 2011 2012 2013 BOARD OF DIRECTORS SENIOR MANAGEMENT Michael F. Neidorff Chairman, President and CEO; Centene Corporation Michael F. Neidorff Chairman, President and Chief Executive Officer Orlando Ayala Corporate Vice President, Chairman Emerging Markets, Chief Strategist, National Competitiveness; Microsoft Corporation Robert K. Ditmore Former President and COO; United Healthcare Corporation Frederick H. Eppinger President and CEO; The Hanover Insurance Group, Inc. Richard A. Gephardt Chief Executive Officer of Gephardt Group LLC; Former Majority Leader of the U.S. House of Representatives K. Rone Baldwin Executive Vice President, Insurance Group Business Unit Carol E. Goldman Executive Vice President and Chief Administrative Officer Jason M. Harrold Executive Vice President, Specialty Company Business Unit Robert T. Hitchcock Executive Vice President, Health Plan Business Unit Jesse N. Hunter Executive Vice President, Chief Business Development Officer Pamela A. Joseph Vice Chairman; U.S. Bancorp John R. Roberts Retired Regional Managing Partner; Arthur Andersen LLP David L. Steward Founder and Chairman of the Board; World Wide Technology, Inc. Tommy G. Thompson Former Health and Human Services Secretary; Former Governor of Wisconsin Donald G. Imholz Executive Vice President, Operations and Chief Information Officer Edmund E. Kroll, Jr. Senior Vice President, Finance and Investor Relations C. David Minifie Executive Vice President, Business Integration and Chief Marketing Officer William N. Scheffel Executive Vice President, Chief Financial Officer and Treasurer Jeffrey A. Schwaneke Senior Vice President, Corporate Controller and Chief Accounting Officer Keith H. Williamson Executive Vice President, General Counsel and Secretary centene corporation Annual Review 2013OTHER INFORMATION TRANSFER AGENT Included in this 2013 Annual Review are financial and operating highlights and summary financial statements. For complete financial statements, including notes, please refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013 filed with the Securities and Exchange Commission (the “2013 Form 10-K”), which also includes Management’s Discussion and Analysis of Financial Condition and Results of Operations. This 2013 Annual Review, together with our 2013 Form 10-K, constitute our annual report to security holders for purposes of Rule 14a-3(b) of the Securities Exchange Act of 1934, as amended. Our 2013 Form 10-K may be obtained by accessing the investor section of our Company’s Web site at www.Centene.com, or by going to the SEC’s Web site at www.sec.gov. FORM 10-K The Company has filed an Annual Report on Form 10-K for the year ended December 31, 2013, with the Securities and Exchange Commission. Stockholders may obtain a copy of this report, without charge, by writing: Investor Relations Centene Corporation 7700 Forsyth Boulevard St. Louis, MO 63105 www.centene.com CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS All statements, other than statements of current or historical fact, contained in this 2013 Annual Review and, in particular, in the Chairman’s Letter, are forward-looking statements. We have attempted to identify these statements by terminology including “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “seek,” “target,” “goal,” “may,” “will,” “should,” “can,” “continue” and other similar words or expressions in connection with, among other things, any discussion of future operating or financial performance. In particular, these statements include statements about our market opportunity, our growth strategy, competition, expected activities and future acquisitions, investments and the adequacy of our available cash resources. Readers are cautioned that matters subject to forward-looking statements involve known and unknown risks and uncertainties, including economic, regulatory, competitive and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions. All forward-looking statements included in this annual review are based on information available to us on the date of its publication. Actual results may differ from projections or estimates due to a variety of important factors, including (i) competition; (ii) Broadridge Corporate Issuer Solutions, Inc. 1717 Arch Street, Suite 1300 Philadelphia, PA 19103 855.627.5087 www.broadridge.com/TransferAgent ANNUAL MEETING The Annual Meeting of Stockholders will be held on Tuesday, April 22, 2014, at 10:00 a.m. at Centene Corporation, 7700 Forsyth Boulevard, St. Louis, MO 63105 in the Auditorium, 314.725.4477. DIVIDEND POLICY The Company has not paid any dividends on its common stock and expects that its earnings will continue to be retained for use in the operation and expansion of its business. COMMON STOCK INFORMATION Centene common stock is traded and quoted on the New York Stock Exchange under the symbol “CNC”. 2013 Stock Price 2012 Stock Price High Low High Low First Quarter $ 48.55 $ 40.57 $ 50.36 $ 38.97 Second Quarter $ 52.74 $ 42.14 $ 50.98 $ 24.26 Third Quarter $ 65.04 $ 52.82 $ 42.46 $ 28.86 Fourth Quarter $ 67.84 $ 54.12 $ 46.44 $ 34.73 membership and revenue projections; (iii) timing of regulatory contract approval; (iv) changes in healthcare practices; (v) changes in federal or state laws or regulations, including the Patient Protection and Affordable Care Act and the Health Care and Education Affordability Reconciliation Act and any regulations enacted thereunder; (vi) changes in expected contract start dates; (vii) changes in expected closing dates and accretion for acquisitions; (viii) inflation; (ix) provider and state contract changes; (x) new technologies; (xi) advances in medicine; (xii) reduction in provider payments by governmental payors; (xiii) major epidemics; (xiv) disasters and numerous other factors affecting the delivery and cost of healthcare; (xv) the expiration, cancellation or suspension of our Medicare or Medicaid managed care contracts by federal or state governments; (xvi) the outcome of pending legal proceedings; (xvii) availability of debt and equity financing, on terms that are favorable to us; and (xviii) general economic and market conditions. We disclaim any current intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Due to these important factors and risks, we cannot give assurances with respect to our future premium levels or our ability to control our future medical costs. Please refer to Item 1A “Risk Factors” of Part I of the Company’s Annual Report on Form 10-K filed with the SEC on February 21, 2014 for a further discussion of these and other important factors that could cause actual results to differ from expectations. 7700 Forsyth Boulevard St. Louis, MO 63105 314.725.4477 www.centene.com centene corporation Annual Review 2013

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