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April 19, 2012 at 09:32 AM
UnitedHealth Group Inc. had no complaints about the effects of the new medical loss ratio (MLR) on first-quarter earnings.
UnitedHealth, Minnetonka, Minn. (NYSE:UNH), says an MLR-related adjustment added $130 million to its profits for the quarter.
UnitedHealth is reporting $1.4 billion in net income for the quarter on $27 billion in revenue, up from $1.3 billion in net income on $25 billion in revenue for the first quarter of 2011.
The company ended the quarter providing or administering major medical coverage for about 36 million people, up from 34 million a year earlier.
UnitedHealth President Stephen Hemsley took pains during the company’s earnings call to emphasize that commercial health insurance is just one of the many products that the company sells.
The company also sells government plan coverage, administrative services, data services and other services, and the fact that commercial insured plan enrollment fell 190,000 during the quarter, to 9.4 million, was expected, Hemsley said.
Company executives said during the earnings call that the drop in insured commercial enrollment was due mainly to the loss of one large government plan customer and decisions by two other large employer groups to self-insure. The groups that chose to self-insure hired UnitedHealth to run the plans, the executives said.
Overall health plan enrollment should increase about 700,000 to 900,000, Hemsley said.
