Oct 14 (Reuters) – UnitedHealth on Friday raised its full-year profit forecast and beat expectations for the third quarter, helped by lower spending on COVID-19 testing and treatment.
As infections linked to the Omicron variant of the coronavirus that causes COVID-19 led to spikes in hospitalizations earlier in the year, insurers and hospitals said the length of stay for patients had shrunk compared to previous waves.
This helped contain costs for health insurers, including UnitedHealth. Prior to the release of the results, analysts had also indicated that the recovery of non-emergency surgeries in some categories remained slow, which could also limit spending.
UnitedHealth forecasts adjusted annual earnings of between $21.85 and $22.05 per share (€22.45 and €22.65), compared to previously forecast $21.40 to $21.90 (€21.98 and €22.50) .
The medical care ratio, the percentage of premiums paid for medical services, improved to 81% in the third quarter from 83% in the same period last year. Analysts had expected a ratio of 82.4%.
The insurer made was a quarterly profit of 5.26 billion dollars, or 5.55 dollars per share, against 4.09 billion dollars, or 4.28 dollars per share, a year earlier.
Adjusted earnings amounted to 5.79 dollars (5.95 euros) per share, exceeding estimates of 5.42 dollars from the IBES consensus of Refinitiv. (Reporting Khushi Mandowara and Manas Mishra in Bangalore; French version Valentine Baldassari, editing by Kate Entringer)