UnitedHealth Group forecasts double-digit earnings growth next year, as the nation's largest health insurer expects a smaller hit from the health care overhaul and a better performance from several parts of its business.
The insurer leaves 2014 with more momentum than it has had the past couple years, and the challenges it faces in 2015 and beyond "are more muted than in recent memory," CEO Stephen Hemsley said Tuesday during a webcast of the company's annual investor meeting in New York.
The Minneapolis-based insurer announced Monday after markets closed that it expects 2015 earnings to range from $6 to $6.25 per share.
That range straddles average analyst expectations of $6.13 per share, according to FactSet.
It also represents 11 percent growth from the company's latest forecast for 2014 earnings of $5.60 to $5.65 per share.
UnitedHealth said it took a roughly 18 percent hit to its earnings per share this year from the overhaul. The federal law expanded coverage to millions of uninsured people in 2014, but it also added taxes and fees to insurer balance sheets and continued to cut funding for a key product: Medicare Advantage plans, which are privately run versions of the government's Medicare program for the elderly and disabled people.
The insurer forecasts a smaller overhaul hit of between 7 percent and 9 percent next year, and it expects improvement in Medicare Advantage, its international business and its Optum segment. That business includes information technology services and pharmacy benefits management.
Hemsley had said in October that he expected growth across the board next year.
UnitedHealth Group Inc. shares closed at $99.06 Monday, one of several all-time high prices that the stock has hit this year.