1Q Earnings Roundup: UnitedHealth’s MA Cost Woes Appear to Be Isolated

May 15
May 15, 2025

After UnitedHealth Group reported disappointing first-quarter financial results reflecting higher-than-expected Medicare Advantage utilization, investors feared a potential repeat of unexpected utilization levels that began in 2023 and depressed insurers’ earnings last year. But UnitedHealth’s struggles — which set off a downward spiral of events that culminated in the abrupt departure of CEO Andrew Witty — appeared to be isolated to UnitedHealth, as most other major publicly traded insurers reported improving medical cost trends and raised their earnings outlook for the year.

Although the insurer’s medical loss ratio of 84.8% was strong by comparison to its large insurer peers and lower (better) than Wall Street’s projected 85.7%, its heavy exposure in MA across its UnitedHealthcare and Optum Health divisions led the company to reduce its MLR and adjusted earnings per share (EPS) guidance for the year. The company now expects full-year 2025 adjusted EPS in the range of $26.00 to $26.50, down from the previous range of $29.50 to $30.00, and an MLR between 87% and 88%, which is significantly higher (worse) than its 2024 MLR of 85.5% and 100 basis points above its previous guidance.
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Lauren Flynn Kelly

Lauren has been covering health business issues since the early 2000s and specializes in in-depth reporting on Medicare Advantage, managed Medicaid and Medicare Part D. She also possesses a deep understanding of the complex world of pharmacy benefit management, having written AIS Health’s Radar on Drug Benefits from 2004 to 2005 and again from 2011 to 2016. In addition to her role as managing editor of Radar on Medicare Advantage, she oversees AIS Health’s publications and manages the health editorial staff. She graduated from Vassar College with a B.A. in English.