Fourth-Quarter Earnings Up for UnitedHealth
UnitedHealth Group, the second-largest U.S. health insurer by membership, on Thursday reported that fourth-quarter earnings increased by 18% to $870 million, or 65 cents per share, from $739 million, or 54 cents per share, a year earlier, the Wall Street Journal reports. According to the Journal, increased membership -- "particularly in the Medicare business," as beneficiaries enrolled in prescription drug plans -- contributed to the fourth-quarter earnings.
William McGuire -- chair and CEO of UnitedHealth, which completed a $9.2 billion acquisition of PacifiCare Health Systems last month -- said that the combined company has enrolled 4.3 million Medicare beneficiaries in prescription drug plans. UnitedHealth expects to enroll a total of 5.5 million Medicare beneficiaries in prescription drug plans by the end of 2006, McGuire said.
UnitedHealth said that fourth-quarter earnings included a two-cents-per-share expense for marketing prescription drug plans to Medicare beneficiaries. In addition, UnitedHealth reported that fourth-quarter revenue increased by 15% to $12.05 billion from $10.51 billion a year earlier.
UnitedHealth increased 2006 earnings estimates to between $2.85 and $2.90 per share from between $2.82 and $2.85 per share (Fuhrmans, Wall Street Journal, 1/20).