UnitedHealth Group's fourth-quarter profit soared as the nation's largest health insurance provider branched deeper into offering care as well as covering the bills.
The healthcare giant said Wednesday that operating earnings from its Optum division grew nearly 10% to $3.4 billion in the quarter. Optum runs one of the nation's largest pharmacy benefits managers and provides care through its Optum Health network of doctors, clinics and surgery centers.
That business served 100 million people last year and saw its revenue per customer increase by a third.
Operating earnings, which don't count interest expense and taxes, also soared for the company's UnitedHealthcare insurance side, which added more people through government-funded Medicare Advantage and Medicaid coverage. That business now covers more than 50 million people.
Company executives said Wednesday that COVID-19 costs were in line with expectations during the quarter and were balanced by a drop in doctor visits and other care.
A surge in cases from the omicron variant of the virus hit late in the quarter and has since bumped up patient hospitalization levels. But UnitedHealth said the severity of cases requiring hospitalization care seems to be lower so far.
Overall, UnitedHealth Group earned $4.07 billion in the final quarter of 2021, up from $2.21 billion the previous year.
Removing one-time benefits and charges, per-share earnings were $4.48, or 18 cents better than expected on Wall Street, according to a survey by Zacks Investment Research.
Revenue jumped more than 12% to $73.74 billion and also topped expectations.
UnitedHealth's Optum Health business works with more than 60,000 physicians and runs primary, specialty and urgent care clinics as well as surgical sites.
The company said it pulled in more revenue per customer as it expanded and shifted more patients into value-based care. That involves reimbursing doctors and other care providers based more on how a patient does rather than for each service performed.
UnitedHealth and rivals like the drugstore chain and insurance provider CVS Health are moving more into providing care in an attempt to keep patients healthier and reduce expensive care like hospital stays.
That approach can bring in more revenue for the care providing side of their businesses while also cutting costs on the insurance side.
Overall, UnitedHealth booked $24 billion in operating earnings last year, with Optum contributing about half that total.
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For 2022, the company reaffirmed its forecast for adjusted earnings of between $21.10 and $21.60 per share on revenue ranging from $317 billion to $320 billion.
Analysts expect, on average, earnings of $21.63 per share on $316.76 billion in revenue, according to FactSet.
UnitedHealth shares climbed 2% to $470.40 Wednesday while the Dow Jones Industrial Average, of which UnitedHealth is a component, rose slightly.
The price of UnitedHealth Group Inc. shares topped $500 for the first time late last year, setting a new all-time high for the Minnetonka, Minnesota, company.