8-KOther EventsExhibits & Filings

CENTENE CORP 8-K Report, Corporate Update (Jun 6, 2013)

Filed June 6, 2013For Securities:CNC

Summary

Centene Corporation (CNC) announced via an 8-K filing on June 6, 2013, that its subsidiary, Kentucky Spirit Health Plan, received an unfavorable summary judgment ruling from the Franklin County Circuit Court in Kentucky. The court determined that Kentucky Spirit cannot terminate its Medicaid managed care contract with the Commonwealth of Kentucky before the initial term expires. This ruling has implications for Centene's operations in Kentucky, and the company is currently analyzing the judgment and considering its legal options. Importantly, Centene has not yet adjusted its 2013 earnings guidance to account for any potential financial impact of this ruling. The company intends to update its earnings forecast to reflect the judgment's effects as more information becomes available, or at the latest, in its second-quarter earnings release. Investors should monitor future communications from Centene for clarity on the financial ramifications of this court decision.

Key Highlights

  • 1Centene's subsidiary, Kentucky Spirit Health Plan, lost a summary judgment in Kentucky.
  • 2The court ruled Kentucky Spirit cannot terminate its Medicaid contract prematurely.
  • 3Centene is evaluating the ruling and exploring legal alternatives.
  • 4The company has not yet revised its 2013 earnings guidance due to this ruling.
  • 5Updated 2013 earnings guidance, including the ruling's impact, is expected later or with the Q2 earnings release.
  • 6A press release detailing the event was issued on May 31, 2013, and is included as an exhibit.

Frequently Asked Questions

The main issue is an unfavorable court ruling against Centene's subsidiary, Kentucky Spirit Health Plan, which prevents it from terminating its Medicaid contract in Kentucky before its initial term ends.

No, Centene has not yet adjusted its 2013 earnings guidance to reflect the impact of this ruling. The company plans to update guidance as more information becomes available or in its second-quarter earnings release.

Centene is currently analyzing the court's ruling and evaluating its legal alternatives. They will communicate any updated financial guidance related to this matter in the future.

The summary judgment means that Kentucky Spirit Health Plan is legally obligated to fulfill its current Medicaid managed care contract with the Commonwealth of Kentucky until the end of its initial term, and cannot unilaterally terminate it earlier as they may have intended.