Healthcare costs continue to rise UnitedHealth (UNH.US) cuts full-year results guidance

The Zhitong Finance App learned that United Health (UNH.US) announced third-quarter results that exceeded expectations. UnitedHealth lowered the highest value of its annual performance guidelines due to rising medical costs and the increasing impact of cyber attacks. The company expects adjusted earnings per share for 2024 to be between $27.50 and $27.75, lower than the previous forecast of $27.50 to $28.

Because the midpoint of the new guidance fell short of analysts' average expectations. In pre-market trading of US stocks, UnitedHealth shares fell 3.53% to $584.00.

According to financial reports, UnitedHealth's Q3 revenue was US$10.8 billion, up 9.1% year over year, higher than market expectations of US$99.2 billion; adjusted earnings per share were US$7.15, and analysts' average expectation was US$6.99.

UnitedHealth's medical loss rate (an important measure of patient care spending) was 85.2%, lower than Wall Street's expectations. The company said this stemmed from pressure on Medicare, the US health plan for the elderly. The number of claims payable days was 47.4, compared to 45.2 in the second quarter of 2024 and 50.7 in the third quarter of 2023.

US health insurers have been struggling to cope with unexpected increases in health care costs and reduced spending on government programs. UnitedHealth was the first company in the industry to announce results and is regarded as a weather vane for the industry.

The new results guidance covers the impact of the serious hacking attack on the company's transformation healthcare division, which is greater than previously anticipated by UnitedHealth Group. Part of the cost of dealing with the crisis was excluded from the adjusted results.