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UnitedHealth cautious after strong second quarter
The Minnesota-based health care giant said Tuesday it expects adjusted earnings to fall between $27.50 and $28 in 2024, an outlook it first predicted last fall.
MINNETONKA, Minn. — UnitedHealth topped second-quarter forecasts but remains cautious about the year as it continues to eat costs from a massive cyberattack and deal with rising medical expenses.
The healthcare giant on Tuesday said it was sticking with an adjusted earnings forecast for 2024 that it first laid out last fall partly due to growing costs from the attack earlier this year on its Change Healthcare business.
Hackers gained access in February to Change’s system and unleashed a ransomware attack that encrypted and froze large parts of it. Change provides technology used to submit insurance claims, and the attack disrupted payments and claims processing around the country.
UnitedHealth booked $1.1 billion in total costs from the cyberattack in the second quarter.
The company said it had restored most of the Change services affected by the attack. Estimated direct costs for its response to the attack have climbed as it started notifying customers who were affected and providing financial support to care providers.
UnitedHealth provides health insurance for more than 49 million people in the United States. Its Optum segment also provides care, runs one of the nation’s largest pharmacy benefits management businesses and offers technology services.
In the second quarter, UnitedHealth’s net income slumped 23% to $4.22 billion. It reported adjusted earnings of $6.80 per share on $98.85 billion in total revenue.
Analysts expected earnings of $6.66 per share on $98.73 billion in revenue.
Medical costs, the company’s largest expense, climbed more than 8% to $65.46 billion in the quarter.
The company’s U.S. medical enrollment climbed 3% in the quarter even as it lost nearly a million customers with Medicaid coverage. Enrollment in the government-funded program for people with low incomes has fallen nationally as states redetermine eligibility after a pause during the COVID-19 pandemic.
For the full year, UnitedHealth said it still projects adjusted earnings between $27.50 and $28 per share. UnitedHealth typically raises its initial forecast at least once this far into the year.
UnitedHealth said that outlook included business disruption costs of between 60 cents and 70 cents per share tied to the cyberattack.
Analysts expect earnings of $27.70 per share, according to FactSet.
UnitedHealth Group Inc. stock edged up less than 1% to $518.56 in premarket trading Tuesday.
Shares of the Minnetonka, Minnesota-based company have slipped 2% so far this year. The Dow Jones Industrial Average, of which UnitedHealth is a component, has climbed nearly 7%.
The council argues that the HERC must be closed to comply with the city’s zero waste policy, which was passed back in 2017.
MINNEAPOLIS — The Minneapolis City Council unanimously approved a plan to shut down the Hennepin Energy Recovery Center (HERC) on Thursday.
The resolution comes after decades of protests against the massive North Loop trash incinerator that burns roughly 365,000 tons of garbage a year.
“Today is a big step towards protecting the health of our communities and addressing longstanding environmental injustices that disproportionately impact communities of color,” said councilmember Robin Wonsley, in a statement.
The resolution calls for the incinerator to be permanently closed by Dec 31, 2027 and for the entire facility to be shut down by Dec 31, 2033.
The council argues that the HERC must be closed to comply with the city’s zero waste policy, which was passed back in 2017.
In October 2023, the Hennepin County Board signed off on a plan to close the HERC between 2028 and 2040, depending on how quickly the county can transition into a zero-waste system.
Of the garbage burned at the HERC, 75% comes from the city of Minneapolis. The other 25% comes from a dozen other cities in the area. The HERC produces enough energy to power more than 25,000 homes and half the buildings in downtown Minneapolis.
At a City Council Meeting on Oct. 10, Jenni Lansing with the City of Minneapolis Health Department provided analysis on the air pollution impacts of HERC. She said the health department supports working towards a zero-waste future and the ultimate closure of HERC, but said closing it now is not the solution.
“Overall emissions in Hennepin County are dominated by on-road and non-road, mobile and nonpoint sources, and these sources drive the cancer and non-cancer risks to health in Minneapolis,” Lansing said.
Hennepin County defines zero waste as preventing 90% or more of all discarded materials from being landfilled or incinerated.
This is a developing story and will be updated as more information becomes available.
The snow is really coming down in some places with Maple Lake getting 3.5″ so far.
GOLDEN VALLEY, Minn. — The wettest Halloween storm ever — is making mischief before little trick-or-treaters hit their neighborhood’s slushy streets.
Officials are reporting several power outages and car spin-outs.
There have been over 14,000 power outages, according to Xcel Energy.
The Minnesota State Patrol has responded to 169 crashes and 94 vehicles off the road, as of 2. pm. Thursday.
Meteorologist Beny Dery said an additional 1 to 2″ of snow is possible before things taper off this evening.
So far some of the totals around town are: 3.5″ Maple Lake, 3.0″ Buffalo, 2.5″ Dassel, 2.4″ Windom, 2.0″ St. Bonifacious, 1.5″ Maple Plain and 1.5″ in Bethel.
The snow is expected to let up from west to east and should wrap up for the metro between 5 to 6 p.m.
Last week, prosecutors charged John Sawchak with attempted 2nd-degree murder and other felony charges after he allegedly shot his neighbor Davis Moturi.
MINNEAPOLIS — Following the shooting between two neighbors, the Minneapolis City Council voted unanimously to request that the city’s auditor conduct an independent investigation into the incidents and cases between Davis Moturi and John Sawchak.
Moturi was allegedly shot by his neighbor, Sawchak, on Wednesday, Oct. 23 but Minneapolis police did not arrest Sawchak until days later.
Minneapolis Police Chief Brian O’Hara defended not arresting Sawchak sooner, calling it a “high-risk” situation. O’Hara later said the victim, who had complained about harassment from Sawchak for months, was failed by police. Sawchak was arrested this past weekend after an hours-long standoff.
Moturi suffered a fractured spine, two broken ribs, and a concussion in the shooting. “Mr. Moturi’s life matters and I’m sorry that for nearly a year, MPD did not treat it like it did,” said Council Member Robin Wonsley in a news release, “Today’s vote affirms that the City Council is committed to taking meaningful actions towards accountability and restoration, starting with this independent review.”
Meanwhile, a spokesperson for Minneapolis Mayor Jacob Frey released this statement:
“Mayor Frey fully supports an independent review of this incident. The mayor and City are committed to always doing better, and this means closely examining past actions and finding where there may be ways to improve and grow. The mayor extends his condolences to Davis Moturi, his wife, Caroline, and their family and friends. The safety of our residents is a top priority and any form of violence or hate speech is completely unacceptable and does not align with who we are as a community. Brian O’Hara will continue to be the Minneapolis Police Chief.”
