In line with the estimates by analysts, health insurer Coventry Health Care reported a 52 percent plunge in its fourth-quarter profit, largely due to an increase in medical costs, which resulted in increase in costs of claims, while it membership fell.

The reported profits of $88.2 million were a substantial fall from the same-quarter earlier-year figures of $184.3 million. The fourth-quarter revenue, which increased 8 percent to nearly $3.02 billion, of the Bethesda, Maryland-based company was also as per analysts' expectations.

The 83.8 percent medical loss ratio - the percentage of premium revenue spent on medical costs - of the company was far worse than the earlier year figures of 78.4 percent.

The CEO of Coventry, Dale Wolf, put up his resignation last month, largely because of a series of missteps the company took in 2008, and was replaced by Board Chairman Allen Wise.

In October, the health insurer lost almost half its market value after it cut its forecast due to a number of reasons like - higher medical costs at its commercial and Medicare health plans, higher overhead expenditure, and a surprisingly low business volume.

Though Coventry has restated its weak outlook for 2009 forecast, it anticipates a better 2010, particularly because of profitable pricing actions and new Medicare Advantage proposals to tackle utilization trends in a better way!