Centene reported a $253 million loss in its second quarter as the provider of government-subsidized health benefits struggles to manage costs of its health plan members.

The managed-care company pointed to increased medical spending in Medicaid, due to behavioral health, home health and high-cost drugs.

Centene on Friday posted a surprise quarterly loss, partly hurt by higher medical costs related to its insurance plans, sending its shares tumbling nearly 13% in premarket trading. The health insurance industry has seen elevated medical costs and changing enrollment patterns,