Medical costs grew faster than revenue at UnitedHealth Group Inc., pulling down fourth-quarter net income by 1 percent at the nation's largest health insurance company.
The Minnetonka-based company said Thursday it earned $1.24 billion, or $1.20 a share, during the quarter ending Dec. 31. During the same period a year ago, UnitedHealth posted profits of $1.26 billion, or $1.17 a share. The results met the average of 19 analysts, according to Bloomberg.
Overall revenue rose 11 percent to $28.8 billion, while the cost of covering medical care for its enrollees climbed 12 percent to $20.8 billion. An early flu season played a role.
United maintained its full-year forecast for 2013 earnings of $5.25 to $5.50 per share, made on Nov. 26.
In a research report, Leerink Swann analyst Jason Gurda described it as "overall, a solid quarter with few surprises, but less impressive than the company's performance earlier in the year."
As the first insurer to report earnings every quarter, United is considered a indicator for the health care sector, particularly as health reform efforts roll out.
Shares were up less than 1 percent to $54.15 in early afternoon trading.
UnitedHealth continued to see enrollment in its benefits plans rise in both company-based plans as well as government-backed plans for seniors using its Medicare Advantage plans and low-income Americans covered by Medicaid.
