Lower Medicare Plan Numbers Hit UnitedHealth Revenue
Minnesota-based UnitedHealth Group on Monday reduced its 2007 revenue forecast based on indications that enrollment in its Medicare Advantage plans would decline modestly this year, Reuters/New York Times reports (Reuters/New York Times, 2/6).
In January, the company cut projections for growth in its Medicare Advantage plans from between 175,000 and 150,000 to between 100,000 and 80,000, according to Don Nathan, a company spokesperson. Now, the company predicts the enrollment change to be "slightly negative," Nathan said (Snowbeck, St. Paul Pioneer Press, 2/6).
The insurer estimates that its 2007 consolidated revenue will be more than $78 billion, a decline from a forecast in January of about $79 billion. However, the company maintained its net earnings prediction of between $4.7 billion and $7.75 billion (Reuters/New York Times, 2/6).
UnitedHealth officials said the company will take measures to improve sales and marketing efforts, including changes in leadership at its Medicare Advantage operations. The insurer also said it would work to better support insurance brokers.
Nathan said that some of the company's marketing materials did not reach Medicare beneficiaries in time to affect 2006 sales.
As of Dec. 31, 2006, the company had 1.4 million seniors enrolled in its Medicare Advantage plans. The Medicare Advantage division of the company is expected to experience revenue of about $28 billion in 2007, up from $25.3 billion in 2006 (St. Paul Pioneer Press, 2/6).