UnitedHealth Group reported nearly $5.5 billion in second quarter profits as its health insurance … [+]
UnitedHealth Group reported nearly $5.5 billion in second quarter profits as its health insurance plans and Optum medical provider businesses grew by “double-digit” percentages despite rising costs, the company said Friday.
UnitedHealth, a nationwide provider of medical care benefits under the Optum umbrella and a company that pays for benefits through its UnitedHealthcare health insurance plans, said net income increased to $5.47 billion compared to $5.07 billion in the second quarter of 2022.
Revenue increased 16% to nearly $93 billion in the quarter compared to $80.3 billion a year ago thanks to “double-digit growth at both Optum and UnitedHealthcare.” UnitedHealth’s second quarter revenue beat some Wall Street analysts’ expectations by nearly $2 billion.
Friday’s second quarter report eased investor worries that rising medical costs across the health insurance industry would hamper growth. Instead, UnitedHealth once again raised its full year net earnings outlook, increasing it to “$23.45 to $23.75 per share and adjusted net earnings to $24.70 to $25.00 per share.”
“Our diverse health care capabilities and dedicated colleagues are enabling us to meet the needs of more people in more ways, driving substantial growth and expanding our opportunities to serve well into the future,” UnitedHealth Group chief executive Andrew Witty said in a statement accompanying Friday’s earnings report.
During the second quarter United Health saw higher usage of healthcare services than they typically see “in certain areas of care,” Witty told analysts on a call Friday morning to discuss earnings. “As you would expect, this inevitably impacts some elements of our business, but we overcame these dynamics with strength in other areas.”
To be sure, the health insurance business UnitedHealthcare reported 1.1 million more customers “year to date” with “growth across the company’s commercial and public sector program offerings” which include Medicare Advantage plans. That helped UnitedHealthcare’s second quarter revenues increase by 13% to $70.2 billion while operating earnings rose 13% to $4.4 billion, the company said.
Meanwhile, Optum’s second quarter revenues soared 25% to $56.3 billion and operating earnings grew 13% to $3.7 billion, led by Optum Health. UnitedHealth’s Optum businesses include an array of healthcare services that include surgery centers, clinics, doctor practices and the pharmacy benefit management (PBM) company, OptumRx, which reported a 15% increase in revenue in the second quarter to $28.6 billion.