UnitedHealth Group’s 4Q profit rises 30 percent
Managed care company UnitedHealth Group Inc. wrapped up 2009 with a third-straight quarterly profit increase, but it starts 2010 still hampered by high unemployment, which hurts its biggest insurance segment.
The Minnetonka, Minn., insurer said Thursday its fourth-quarter profit rose 30 percent, due in part to premium increases and a big legal charge that weighed down results in the last quarter of 2008.
But UnitedHealth’s commercial enrollment — which includes higher-margin business like employer-based and individual health plans — fell by 1.7 million people compared with the year-earlier period.
The insurer ended 2009 with commercial enrollment of 24.6 million, a drop of 6.5 percent. Partially offsetting those losses was a 12.5 percent increase in enrollment for Medicare and Medicaid plans to just under 7.4 million people.
CEO Stephen J. Hemsley said attrition, or job cuts, accounted for more than half of the commercial enrollment loss. [Read the full article]
The market just closed and UnitedHealth (UNH)’s stock dropped 4.2% or $1.45, coming to rest at $33.10 a share. The drop was twice what the broader market experienced (2%). Why is this newsworthy? The company reported before the market opened that earnings were up 30% during the fourth quarter, compared to the same quarter last year. UnitedHealth earned 81 cents a share, beating average analyst expectations of 73 cents and exceeding the 60 cents a share posted in the fourth quarter of 2008. It sounded like a great quarter yet the stock took a haircut. Fears about a Washington takeover of health insurance don’t explain the investor response. Ever since Scott Brown’s victory Tuesday, efforts to pass a health overhaul have fallen apart. Today Nancy Pelosi said that the House did not have enough votes to pass the Senate version of the bill–pretty much guaranteeing a trip back to the drawing board. The key may be in looking at the HMO’s commercial enrollment. [Read the full article]
Molina Healthcare of Missouri announced today that Peter Goll has been named Chief Operating Officer of its health plan, a subsidiary Molina Healthcare, Inc. (NYSE: MOH – News). In his new role, Goll will be responsible for managing all operational aspects of the company, including providing leadership and vision necessary to ensure effective organizational growth and financial strength. As chief operating officer, he will also oversee activities related to customer service, community outreach, appeals & grievances, provider contracts and provider services.
“Peter Goll has served in numerous leadership positions in the health care industry. His experience will be a great asset to our Missouri team,” said Joanne Volovar, president of Molina Healthcare of Missouri. [Read the full article]