UnitedHealth CEO expects 2016 growth as reform law effects wane
Posted On: Dec. 2, 2014 12:00 AM CST
(Reuters) — UnitedHealth Group Inc. CEO Stephen Hemsley on Tuesday said that as the effects of the national health care reform law diminish in 2016, the health insurer expects its pace of growth to be above 2015 and to accelerate from there.
Mr. Hemsley told analysts and investors he expects 2015 earnings to be near the top of the company's forecast range, which is $6 to $6.25 per share.
In 2014, lower payments to insurers for Medicare Advantage plans and new taxes that insurers must pay under the Patient Protection and Affordable Care Act, often called Obamacare, cut into after-tax operating profit by $400 million, UnitedHealth said. That figure takes into account some offset from the positive effects of Medicaid expansion, it said. In 2013, the effects of the ACA cost the company $1 billion.
"By 2016, these impacts are far less significant," UnitedHealth's chief financial officer, Daniel Schumacher, said in a webcast of the same meeting. "We expect to grow faster in 2016 and beyond."
UnitedHealth shares were up 0.4% at $99.42 late on Tuesday morning.