INDIANAPOLIS (AP) — UnitedHealth Group Inc.'s third-quarter net income edged slightly lower because medical costs rose, but the health insurer's revenue and enrollment grew and it increased its 2011 earnings forecast.
The Minnetonka, Minn., company earned $1.27 billion, or $1.17 per share, in the three months that ended Sept. 30. That compares with $1.28 billion, or $1.14 per share, in the same quarter last year, when the company had more shares outstanding. Revenue rose 7 percent to $25.28 billion.
Analysts forecast earnings of $1.12 per share on $25.41 billion in revenue.
The insurer said Tuesday that it now expects 2011 earnings to range between $4.40 and $4.45 per share on more than $101 billion in revenue. That compares with its previous forecast for earnings of $4.15 to $4.25 per share on $101 billion in revenue.
UnitedHealth is the largest health insurer based on revenue and typically the first to report earnings each quarter. Many see the company as a bellwether for managed-care companies. Health insurance is UnitedHealth's biggest business, but it also operates segments that sell wellness programs and information services.
The insurer's medical costs, or medical claims paid, climbed 7 percent in the quarter to $18.41 billion. UnitedHealth's Optum businesses, which focus on health services information and technology, helped offset that with a 22 percent jump in revenue to $7.22 billion.
UnitedHealth's medical enrollment also climbed 5 percent from last year to about 34.4 million people.