UnitedHealth Group, Minneapolis, reported a 37% gain in first-quarter profits thanks to acquisitions, new products and a slowdown in medical-cost growth. Net income for the three months ended March 31 reached $554 million, or 88 cents per share, compared to $403 million, or 65 cents per share, in the year-ago quarter. Revenue rose 17% to $8.1 billion, and enrollment rose 11% to 20 million members. UnitedHealth said it now expects medical costs to increase 9% to 9.5% this year, slower than its earlier projection of 9.5% to 10%. The company slightly raised its 2004 per-share earnings forecast to between $3.75 and $3.78, or growth of 26% to 28% over 2003; in January, it forecast annual earnings growth of 25% to 26%. UnitedHealth acquired 1.5 million-member Mid Atlantic Medical Services in February and Golden Rule Financial Corp. in November 2003. The company said members are responding well to its new products, which include health saving accounts and digital identification cards. -- by Laura B. Benko
UnitedHealth first-quarter earnings rise 37%
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