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UnitedHealth second-quarter profit up 12.6%

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UnitedHealth second-quarter profit up 12.6%

UnitedHealth Group Inc., the nation's largest publicly traded health insurer, recorded double-digit growth in total revenue and net income for the second quarter of 2015, reflecting strong performances across its insurance and health services segments.

The Minnetonka, Minnesota-based health insurer collected $36.26 billion in total revenue in the three months ending on June 30, an increase of 11.3% over the same period in 2014. Second-quarter profit grew by 12.6% year-over-year to $1.59 billion.

Senior executives at UnitedHealth Group said during a conference call with investment analysts Thursday that the company's results were driven mainly by organic growth in both its UnitedHealthcare and Optum business segments, which recorded increases in second-quarter revenue of 9.9% and 16.2%, respectively.

Within UnitedHealth's insurance segment, the company increased its total medical membership by roughly 2.1% compared with enrollment totals at the end of the second quarter of 2014, with the largest gains coming via Medicaid.

“We're positioned well for the second half of 2015 and continue to forecast that UnitedHealth Group's earnings-per-share growth will accelerate in 2016,” Stephen Hemsley, the company's CEO, said during the call.

Mum on mergers

UnitedHealth executives were largely silent on the issue of consolidation at the top of the health insurance market. Mr. Hemsley concluded his prepared remarks by saying that the company would not comment on “market-specific activities or hypothetical implications that we are not involved in.”

“We're not going to comment on the activity of others or subsequent processes and market dynamics that no one really yet knows,” Mr. Hemsley said, referring to Aetna Inc.'s recent agreement to purchase rival insurer Humana Inc. for $37 billion and a possible merger between Anthem Inc. and Cigna Corp.

UnitedHealth Group has been rumored recently to have explored purchasing Aetna but has not commented publicly on the possibility of a deal.

Asked to characterize the company's near-term appetite for mergers and acquisitions given the activity among its closest competitors — as well as ongoing consolidation of hospitals, physician groups and other health care providers — Mr. Hemsley said UnitedHealth already has “plenty of scale across all of our business segments” to effectively negotiate medical care pricing with providers.

“Our businesses are well-positioned across the expanse of benefits and services,” he said. “We're well-positioned across virtually all of the key markets, and I think we can continue to drive very strong cost positions.”

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