UnitedHealth Group’s Profits Exceed $5 Billion Thanks To Optum And Medicare Growth – Forbes
UnitedHealth Group’s profits eclipsed $5 billion in the first quarter of 2022, the company said … [+]
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UnitedHealth Group’s profits surpassed $5 billion in the first quarter thanks to a strong performance by its Optum health business and customers flocking to the company’s Medicare Advantage plans.
UnitedHealth Thursday said net income increased to $5.02 billion compared to $4.86 billion in the first quarter of 2021 as the healthcare giant’s diverse portfolio of health insurance plans and its Optum medical care services delivered a strong performance. Revenues rose 14% to $80.1 billion in the quarter compared to $70.2 billion a year-ago.
The results beat Wall Street analysts’ expectations and led UnitedHealth executives to raise the company’s financial forecast for the rest of the year. UnitedHealth now expects adjusted earnings of $21.20 to $21.70 per share compared to an earlier forecast of $21.10 to $21.60 per share.
UnitedHealth’s UnitedHealthcare health insurance business grew thanks to government-subsidized insurance in its increasingly popular Medicare Advantage plans, which contract with the federal government to provide extra benefits and services to seniors, such as disease management and nurse help hotlines with some also offering vision, dental care and wellness programs.
“In Medicare Advantage, our strategic balance of benefit stability and enhancements once again helped to deliver strong growth,” UnitedHealth Group chief executive officer Andrew Witty told analysts on a call Thursday morning to discuss earnings. “We remain well on-track to serve an additional 800,000 people in 2022, consistent with the expectations we set last November.”
UnitedHealth’s performance in Medicare Advantage is important given the intense competition with established rivals including Humana, Cigna, Anthem and CVS Health’s Aetna expanding into new markets while several smaller health insurers and startups have entered the business in recent years as well.
UnitedHealth’s Optum business also performed well with revenue growth of 18.9% to $43.3 billion in the first quarter.
“Optum Health continued its robust momentum into the first quarter, characterized by its integrated approach and high clinical quality,” Witty told analysts. “After a strong start to the year, we now expect to add 600,000 patients under value-based arrangements during 2022, compared to our initial estimate of 500,000.”
