Bank of America Merrill Lynch Neutral On WellCare Health Plans

Bank of America Merrill Lynch is out with a research report on WellCare Health Plans, Inc (NYSE: WCG) and it has a Neutral rating and a $54 price target on shares.

In a note to clients, Bank of America Merrill Lynch writes, "By state law, Florida Healthy Kids reimbursement rate updates effective October 1, 2011 are 0% again. WCG covers 60,225 lives in the CHIP program worth just $77 million in annual revenue (9% of its Florida Medicaid book), or 2% of total Medicaid premiums. An 85% minimum MLR provision is consistent with previous terms. This contract is not material to overall results, but another example of generally tough rates in Florida over the past few years."

Shares of WCG gained $1.96 yesterday to close at $45.91.