UnitedHealth Forecasts Medical Costs for 2025
(Reuters) – UnitedHealth (NYSE:UNH) on Wednesday forecasted medical costs for 2025 above Wall Street expectations, anticipating continued high demand for healthcare services in its government-backed insurance businesses.
U.S. health insurers have faced increased medical costs related to their Medicare Advantage plans as older adults seek non-urgent medical care postponed during the pandemic over the past year.
Additionally, alterations in Medicaid enrollment norms for low-income individuals and lower government payment rates have also impacted insurers.
UnitedHealth expects the 2025 medical cost ratio—the percentage of premiums spent on medical care—to range between 86% to 87%. The midpoint exceeds analysts' estimates of 84.77%, according to data compiled by LSEG.
The company also forecasts adjusted profit for 2025 will largely align with Wall Street estimates as of Tuesday.
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