UnitedHealth profit beats estimates on health insurance unit boost By

(Reuters) -UnitedHealth Group Inc beat quarterly profit estimates on Wednesday as its health-services unit Optum posted strong growth and more people signed up for the insurer’s government-backed plans during the COVID-19 pandemic.

The largest U.S. health insurer said members in its Medicare Advantage (MA) health plans, for people older than 65 or with disabilities, increased by more than 900,000 in 2021.

The comments could ease investor concerns around the impact of rising competition on the MA insurance plans, which are funded by the U.S. government but administered by private insurers like UnitedHealth (NYSE:).

Rival Humana Inc (NYSE:) had slashed its 2022 growth view for MA plans earlier this month in a move that had sent shares in the sector lower.

UnitedHealth also reiterated its 2022 adjusted profit forecast of between $21.10 and $21.60 per share.

The insurer, whose medical costs had fluctuated for much of 2021 due to COVID-19, reported a medical care ratio of 82.6% for the full year, compared with 79.1% a year earlier. The ratio represents the percentage of premiums paid out for medical services.

For the fourth quarter ended Dec. 31, UnitedHealth’s core business that sells health insurance plans reported a 12% jump in sales to $56.4 billion.

Revenue from its Optum unit, which manages drug benefits and offers healthcare data analytics services, rose about 14.5% to $41.1 billion.

Adjusted earnings came in at $4.48 per share, beating analysts’ average estimate of $4.31 per share, according to IBES data from Refinitiv.