UnitedHealth Group. boosted its earnings outlook for the year as it posted strong profit growth in the latest quarter on climbing revenue across its segments.
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The Minnetonka, Minn., company now expects adjusted earnings for the year of about $8 a share compared with its previous forecast of $7.80 to $7.95 a share.
The health-care delivery businesses drove growth at Optum, its health-services unit, where revenue rose 9% to $21.1 billion. The business has benefited from UnitedHealth's acquisition of pharmacy-benefit manager Catamaran Corp., which was completed in July 2015.
Meanwhile, the insurer's medical-cost ratio -- the percentage of premiums paid in claims -- decreased 60 basis points year-over-year to 80.3% in the third quarter.
UnitedHealth said revenue from its employer-based and individual plans rose 12% to $13.3 billion in the period. It said growth from employer-sponsored groups offset decreases in individual benefit coverage, but otherwise the company didn't detail performance of its plans' part of the Affordable Care Act. UnitedHealth has said it would leave many markets in which it currently sells plans on government-run exchanges next year, and previously said it anticipates losing about $850 million on the plans this year.
The largest U.S. health care insurer and the first to report earnings, UnitedHealth is typically viewed as a bellwether for the industry.
Over all, UnitedHealth reported a profit of $1.97 billion, or $2.03 a share, up from $1.6 billion, or $1.65, a year earlier. Excluding certain items, earnings rose to $2.17 a share from $1.77.
Revenue climbed 12% to $46.29 billion. Analysts had projected adjusted earnings of $2.08 a share on revenue of $46.09 billion, according to Thomson Reuters.
Shares in the company have risen 12% in the past 12 months and were inactive premarket.
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