UnitedHealth has debuted a lower-than-expected 2021 earnings forecast partly due to the unknown extent of COVID-19’s impact on the health care system.
The nation’s largest health insurance provider said Tuesday that it expects to take a hit in the new year from treatment and testing costs tied to the pandemic. It believes it may see more claims for things like elective surgeries that people deferred this year as the pandemic spread.
The company also cited a potential impact from rising unemployment, which can reduce employer-sponsored health insurance enrollment.
The company said it expects adjusted earnings to range from $17.75 to $18.25 per share on revenue of between $277 billion and $280 billion.
Insurers like UnitedHealth reaped huge profits earlier this year when the pandemic forced patients to put off elective surgeries and other care that wasn’t deemed essential. But health insurers say those care levels have since nearly returned to normal.
UnitedHealth has earned $13.19 billion through the the first nine months of this year, with adjusted earnings totaling $14.36 per share.
The company also said Tuesday that its adjusted earnings for 2020 will approach $16.75 per share, which is slightly higher than the average Wall Street forecast.
Based in Minnetonka, Minnesota, UnitedHealth Group Inc. runs a health insurance business that covers about 48 million people, mostly in the United States.
Its Optum segment also runs one of the nation’s largest pharmacy benefit management operations as well as a growing number of clinics and urgent care and surgery centers.
Shares of UnitedHealth, which is a component of the Dow Jones industrial average, jumped 5% to $353.20 Tuesday.