UnitedHealth Group raised its financial outlook after beating analyst estimates for the first quarter, as the nation's largest health insurer grew its Medicare business and moved beyond losses related to the federal Affordable Care Act.
The Minnetonka-based company's UnitedHealthcare insurance division saw revenue increase by 12 percent due in part to growth of 670,000 enrollees in the company's Medicare health plans.
The quarter was the first for UnitedHealthcare after dropping most of the 34 government-run insurance exchanges where the insurer reported significant financial losses in 2016.
The exchanges were launched as part of the federal health law, which Republicans in Washington have not yet been able to repeal and replace as promised. Stephen Hemsley, the UnitedHealth Group chief executive, said his company has talked about possible changes with elected officials, but focused his comments Tuesday on tax aspects of the Affordable Care Act (ACA).
"We hope Congress acts soon to permanently repeal the health insurance tax before it further worsens consumers' premiums, state budgets and seniors' benefits," he said during a conference call with investors.
Hemsley said the tone of health care policy discussions in Washington has improved, and gives him hope for changes that will improve coverage and spur innovation.
As for what might actually happen, the CEO said: "I think it's really more around what is politically possible, maybe in contrast to what might be the most effective policy that could be applied."
In the first quarter alone, UnitedHealthcare picked up 1.5 million additional health insurance customers, before factoring a reduction of 765,000 subscribers through individual policies under the ACA. Business grew from both the Medicare and Medicaid government health insurance programs.
