Best’s News & Research Service - July 16, 2015 03:52 PM (EDT)
UnitedHealth Group Posts 13% Rise in Second-Quarter Net
NEW YORK //BestWire// - UnitedHealth Group, the largest U.S. health insurer, posted double-digit results in second-quarter net income and revenue.
Net income rose 13% to $1.58 billion from $1.4 billion. Revenues grew 11% to $36.3 billion from $32.6 billion.
UnitedHealth added 1.6 million more customers in the United States, including 175,000 in the second quarter, the company said in a statement.
"We expect 2016 growth and results to be even stronger," said Stephen J. Hemsley, chief executive officer of UnitedHealth Group, during a conference call.
UnitedHealth also updated its 2015 financial outlook to include the anticipated Catamaran Corp. acquisition by Optum Rx, UnitedHealth's pharmacy benefits manager, for $12.8 billion. The deal is expected to close this month (Best's News Service, March 30, 2015).
Second-quarter Optum revenues rose 16% to $13.6 billion, UnitedHealth said in a statement. Optum's operating earnings were $864 million, up from $728 million. Larry Renfro, vice chairman of UnitedHealth Group and CEO of Optum, said in the call that Optum is "committed to creating a next-generation pharmacy care services company." The company uses an approach that integrates data, information, analytics and clinical care to support... treatments "rather than just filling prescriptions," he said. "This is doubly true in the coming era of specialty drugs. We will bring better and more consistent overall quality and lower costs for consumers. This approach enhances the differentiated value OptumRx offers customers beyond the benefits of our combined purchasing of over 1 billion scripts per year."
UnitedHealthcare employer and individual had membership of 29.4 million people. Attrition in individual exchange products was the primary factor in the overall net reduction of 30,000 people served in the second quarter.
UnitedHealth said 7.2 million seniors members received medical benefits through Medicare Advantage and Medicare Supplement offerings in the second quarter, and more than 5 million people benefiting from stand-alone Medicare prescription drug coverage. In the first half of 2015, Medicare Advantage grew by 7% to serve 200,000 more seniors and Medicare Supplement products grew 6%.
Second-quarter 2015 UnitedHealthcare Medicare and retirement revenues grew 7% to $12.6 billion.
Insurance units of UnitedHealth Group have current Best's Financial Strength Ratings of A (Excellent).
In afternoon trading July 16, shares of UnitedHealth Group Inc. (NYSE: UNH) were priced at $124.82, down 0.83% from their previous close.
(By Dennis Gorski, managing editor-online, BestWeek: Dennis.Gorski@ambest.com)