Ventura Cannabis and Wellness Corp CVHIF

Centene financials

[STOCKMAN70]

Centene released its financials yesterday - can viewed on Edgar. Most probably know already but health net was acquired by centene and they are one of the companies that cxv is fighting over fees with. I may regret this and I think cxv still has a good chance of going up but I sold my position today (with a .005c gain). The reason being is that I interpret the following to imply that the reduction in fees is maybe permanent so convalo will receive less for some of its services going forward -  I could be completely wrong in my interpretation and even if the insurers pay less cxv can adjust their variable costs to deal with this change and become profitable.  There are many other reasons the stock price could increase as well as this company has many positives; but for now I am waiting on the sidelines. 

From note  (c) on  p.9 of the financials released yesterday on Edgar:
"Accounts payable and accrued expenses includes approximately $285 million related to premium deficiency reserves based on cost trends existing prior to the acquisition date. The premium deficiency reserves are primarily associated with losses in the individual commercial business, largely in California, unfavorable performance in the Arizona commercial business as well as unfavorable performance in the Medicare business primarily in Oregon and Arizona. The premium deficiency reserve for the individual PPO commercial contracts in California includes anticipated future losses in 2016 associated with substance abuse rehabilitation claims. During the third quarter, the Company lowered the premium deficiency reserve by $15 million, reflecting its revised estimate of substance abuse cost trends."

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