(Reuters) – Elevance Health Inc raised its annual earnings forecast and beat quarterly profit estimates on Wednesday, aided by lower medical costs in its health insurance business.
A decline in COVID hospitalizations and slow recovery in non-urgent surgeries has helped keep medical costs in check for health insurers over the past few quarters.
Larger rival UnitedHealth Group raised its profit outlook last week on expectations of membership gains in Medicare Advantage plans.
Elevance said total medical memberships increased nearly 3% to 48.1 million as of March 31 compared with last year, primarily driven by growth in its Medicaid, Medicare Advantage and commercial fee-based plans.
The company’s benefit expense ratio, a measure of the share of premiums paid for medical services, was 85.8% in the first quarter, compared with 86.1% a year earlier.
On an adjusted basis, the company now expects annual profit of more than $32.70 per share, compared with its previous forecast of over $32.60 per share.
Excluding items, Elevance earned $9.46 per share, above Refinitiv IBES estimates of $9.26 per share.
(Reporting by Raghav Mahobe and Nandhini Srinivasan; Editing by Vinay Dwivedi)
