Additionally, the healthcare company's earnings from operations nearly doubled year-over-year.
UnitedHealth Group weathered the impact of coronavirus disease 2019 (COVID-19) during Q2 2020 and posted a $1.5 billion increase in quarterly revenues, according to the company's latest earnings report released Wednesday morning.
The Minnetonka, Minnesota–based insurer reported that its net earnings and adjusted net earnings per share (EPS), $6.91 and $7.12, respectively, were "substantially higher than anticipated" due to the temporary deferral of the company's risk-based business. UnitedHealth added that these results will likely be offset by the resumption of deferred care in future quarters.
Forward looking, UnitedHealth is maintaining its EPS outlook for the rest of 2020 in a range of $15.45 to $15.75 per share.
Additionally, the healthcare company's earnings from operations nearly doubled year-over-year, rising from $4.7 billion in Q2 2019 to $9.2 billion in Q2 2020.
"Our 325,000 dedicated team members, including the 120,000 clinicians serving on the front lines of care, have tirelessly responded to COVID-19 with agility, innovation and compassion," David S. Wichmann, CEO of UnitedHealth, said in a statement. "We moved swiftly to assist the people we serve and their care providers, including the provision of $3.5 billion in proactive voluntary customer assistance and accelerated care provider funding. We remain committed to taking further actions to address any future imbalances as a result of the pandemic."
UnitedHealth returned $1.2 billion in dividends to its shareholders during the quarter and reported cash flows from operations of $10 billion.
By segment, UnitedHealthcare posted revenues of $49.1 billion while Optum posted revenues of $32.7 billion.
Optum benefited from revenue per consumer growth of 25% year-over-year while UnitedHealthcare struggled with commercial enrollment declines.
UnitedHealth has been part of several initiatives to address the ongoing pandemic, including a collaborative project announced in late April to deploy 3,000 'light' ventilators to fight the disease.
Also part of the company's COVID-19-related projects, Sir Andrew Witty, CEO of Optum and president of UnitedHealth Group, announced in April he would take a leave of absence to co-lead the World Health Organization's (WHO) efforts to develop a vaccine for COVID-19.
The company's Q2 earnings report was strong, according to Dean Ungar, vice president of Moody's Investors Service, but indicates there will be a continuing impact related to the coronavirus outbreak on the business' bottom line for the rest of the year.
"UnitedHealth Group kicked off health insurance second quarter earnings season with an 85% increase in EBITDA to $10 billion year-over-year. Incremental costs from the coronavirus, including the waiver of cost sharing for diagnosis and treatment, were more than offset by the savings from deferral of other medical services," Ungar said in a statement. "We expect to see similarly strong results among the other health insurers, supporting our stable outlook for the industry. However, UnitedHealth did not raise earnings guidance and membership was down modestly, reflecting the economic impact of the coronavirus and UnitedHealth's expectation of higher costs in the second half of the year due to the return of deferred procedures and costs related to the coronavirus."
For complete financial information, review UnitedHealth's filing with the Securities and Exchange Commission.
Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.
Photo credit: KIEV, UKRAINE - Dec 10, 2018: UnitedHealth Group Managed care company logo seen displayed on smart phone. - Image / Editorial credit: IgorGolovniov / Shutterstock.com