UnitedHealth Group delivered a better-than-expected first quarter and raised its 2022 forecast, as growth in Medicare Advantage coverage and care delivery once again helped the health care giant.
The nation’s largest health insurance provider said enrollment in its Medicare Advantage plans grew nearly 9% to about 6.9 million people, and the company also booked growth in other government-funded coverage. Its larger commercial enrollment stayed nearly flat.
UnitedHealth is the biggest provider of Medicare Advantage plans, which are privately run versions of the federally funded Medicare program.
The company runs UnitedHealthcare, a health insurance business that covers more than 50 million people mostly in the United States. It also has been squeezing more growth out of its Optum segment, which runs one of the nation’s largest pharmacy benefit managers and a growing number of clinics and urgent care and surgery centers.
First-quarter operating earnings, which don’t count interest expense and taxes, slid for the company’s health insurance business but jumped almost 20% to $3.2 billion for Optum compared to last year.
UnitedHealth said the revenue it drew per customer from its care-providing Optum Health business grew by 33% as the company expanded deeper into value-based care. That involves reimbursing doctors based more on the patient’s health instead of for each service provided.
UnitedHealth and competitors like the drugstore chains CVS Health and Walgreens are all trying to become regular sources of care for more customers, especially those with Medicare Advantage plans.
The idea is that regular care will keep patients with chronic health problems like diabetes healthy and out of expensive hospitals. It’s an approach bill payers like insurers and employers have started to embrace.
Overall, UnitedHealth earnings grew 3% to $5.03 billion in the first quarter. Adjusted results totaled $5.49 per share, and total revenue jumped more than 14% to $80.1 billion.
Analysts expected, on average, earnings of $5.36 per share on $78.73 billion in revenue in the second quarter, according to FactSet.
For the full year, UnitedHealth now expects adjusted earnings of $21.20 to $21.70 per share. That’s an increase of 10 cents on both ends of the range from a forecast it laid out late last year.
FactSet says analysts expect earnings of $21.61 per share for 2022.
Shares of Minnetonka, Minnesota-based UnitedHealth Group Inc. climbed less than 1% in premarket trading.
Follow Tom Murphy on Twitter.