By Anna Wilde Mathews
UnitedHealth Group Inc. is scheduled to announce its
fourth-quarter earnings before the market opens Wednesday. Here's
what you need to know:
--EARNINGS FORECAST: Net income of $1.50 a share for the fourth
quarter is the consensus of analysts surveyed by Thomson Reuters,
compared with $1.41 a share reported a year earlier. The company
said in December that it expects per-share earnings for 2014 to be
in the range of $5.60 to $5.65.
--REVENUE FORECAST: Revenue of $33.11 billion for the fourth
quarter is projected by analysts, compared with $31.12 billion a
year earlier.
WHAT TO WATCH:
--HEALTH-CARE COSTS: Health spending has been rising at a
relatively limited pace, a boon to insurers. But managed-care
investors are watching closely for signs of an uptick -- and
hospital companies' recent reports of increasing patient volumes
have fueled their worries. As the biggest insurer and the first to
report, UnitedHealth is seen as a bellwether, and its views on
spending trends are closely monitored.
--FLU: One specific area of concern for analysts likely will
stem from signs that this year's flu season may be somewhat more
severe. That could cause unexpected expenses for insurers. Another
line of questioning likely will be around specialty drugs,
particularly the hepatitis C medications. Insurers and
pharmacy-benefit managers have been striking deals with
manufacturers to favor particular medicines for the liver
disease.
--HEALTH LAW: UnitedHealth's insurance arm is selling plans in
23 states' health-law marketplaces in 2015. Listen for its take on
enrollment, including any signal about demographics such as age.
The company will likely also get asked about its plans and risks
should the Supreme Court strike down many of the health law's
federal subsidies, a decision that would create huge challenges for
insurers offering plans under the Affordable Care Act.
Write to Anna Wilde Mathews at anna.mathews@wsj.com
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