UnitedHealth made far more money over the last three months than Wall Street expected.

It’s shareholders just got a lot richer.

UnitedHealth Group, the nation’s biggest insurer, announced this morning that despite the continuing pandemic, its profits and revenue growth were so strong over the past three months that it expects to make considerably more money this year than the company’s executives had expected. This despite the fact that United continued to bleed private sector customers. 

 Wall Street loved the company’s news so much that investors were poised to buy more shares of United’s stock when the New York Stock Exchange opened this morning. 

Although United shed more than half a million people who had been enrolled in health plans it sells to employers and individuals, its profits were still far higher than Wall Street financial analysts had expected because the company continued to grow at taxpayer’s expense. 

United is now taking in far more money from federal and state government programs than from employers and people who buy their coverage in the individual (Obamacare) marketplace. Of the $53 billion in revenue the company’s health plan business took in, 72% of it came from its Medicare Advantage and Medicare supplement business and the state Medicaid programs it manages.

Wall Street financial analysts had assumed United would post solid profits, but the company blew their expectations out of the water. 

The consensus estimate of the analysts who cover the company was that United would report earnings per share of $4.45. United beat that by a whopping 25 cents per share. This continued United’s two-year streak of exceeding Wall Street’s profit expectations. 

United’s profits would have been even higher if not for the fact that more people were venturing out to see their doctor or check into the hospital for an elective procedure than during the same three months of 2020. It’s medical loss ratio (MLR) rose from 70.2% in the second quarter of 2020 to 82.8% during the same period this year. That means United spent 82.8 cents of every dollar it took in from its health plan customers paying claims.

While that’s higher than last year, it was actually slightly lower than the 83.1% MLR it reported for the second quarter of 2019, well before the pandemic started. 

In terms of people enrolled in United’s health plans, it would not have grown at all had it not been for the government programs. The company served more than half a million fewer people in the plans it sells to employers and individuals in the so-called commercial market. It more than made up for that in the government programs, gaining 780,000 Medicare Advantage enrollees and 920,000 enrollees in its Medicaid business. The company also saw a gain of 60,000 in its Medicare supplement business but a loss of 370,000 people in its Medicare Part D prescription drug program.

Overall, United’s profit and revenue growth were so much more than analysts had expected that the company increased its earnings estimate for the rest of the year. 

That was music to Wall Street’s ears. Watch for United’s stock price to set an all-time high in the days ahead.