Carl McDonald Quotations

My sense heading into the quarter was the market expected Humana to raise guidance today. I think they ultimately do raise guidance for 2006, but given that they didn't today, I think that will be viewed as a disappointment.

We think Aetna's results will be more than enough to sustain the stock's recent strength.

I think their focus for the early part of 2006 is going to be integrating the businesses they've acquired.

I think we're going to continue to see consolidation. Will it slow relative to what we've seen in 2004 and 2005? Most likely.

The deal would surprise no one, and the proposed price, at $77 per share, would be neutral to slightly accretive to earnings, by our calculations.

This is the second quarter in a row that Cigna has grown enrollment, and provides further evidence that the turnaround at Cigna is progressing smoothly.

Clearly the focus is Medicare, including what their outlook is going to be for enrollment in 2006. The driver in the fourth quarter was principally what they spent getting ready for the Medicare opportunity in 2006.

Humana's commercial business performed reasonably well this quarter, in part due to lower inpatient utilization trends, which also positively impacted the company's government operations. We think cost trends continue to decelerate in 2006, in part driven by slowing pharmacy costs.