UnitedHealth Group Thursday reported second quarter net income of $5.48 billion as medical costs dropped, triggering an improved financial outlook for the rest of the year.
The company, the parent of UnitedHealthcare, the nation’s largest health insurer, raised its full year 2026 adjusted net earnings to “between $19.50 and $20 per share resulting from performance year-to-date and an improved outlook for the remainder of the year.” That compares to an earlier adjusted net earnings forecast of “greater than $17.75 per share.”
“The second quarter 2026 medical care ratio was 86.7% compared to 89.4% in the second quarter 2025,” the company said of the ratio, which is the percentage of premium revenue that goes toward medical costs. “The year-over-year decrease was driven by benefit design and pricing discipline, member mix and medical cost management initiatives.”
UnitedHealth reported net income of $5.48 billion, or $6.04 per share, in the second quarter ended June 30 of this year, compared to $3.4 billon, or $3.74 per share in the year ago quarter. Total company revenues grew slightly to $112.03 billion compared to $111.6 billion in the year-ago period as the company grew certain Optum health services businesses and the employer and individual business plans sold by UnitedHealthcare.
Medical loss ratios have risen to 90% and above for several health insurance companies as claims pile up from doctors and hospitals seeing an influx of patients with a pent up demand for medical care. In UnitedHealth’s fourth quarter of last year, the insurer’s medical care ratio was 91.5%. The industry would prefer such ratios to be below 90% and into the mid 80s, where the industry was less than two years ago.
UnitedHealth’s medical loss ratio has now been below 90% for the second consecutive quarter and it was better than rival Elevance Health’s benefit expense ratio in its second quarter of 89.7 percent, which “increased 80 basis points year over year,” according to that company’s second-quarter earnings report released on Wednesday of this week.
UnitedHealthcare’s improving medical cost picture comes in part due to decisions by new management to exit unprofitable markets where the company has sold individual coverage under the Affordable Care Act, also known as Obamacare, as well as pulling out of scores of counties where the company no longer sells privatized Medicare Advantage plans. Health insurers including UnitedHealthcare, CVS Health’s Aetna, Humana and Elevance Health all have been struggling to contain medical expenses of a record number of older adults enrolled in Medicare Advantage plans.
The exits from these markets contributed to a loss of health plan members, with UnitedHealthcare serving about 48.5 million people in the second quarter of this year compared to 49.8 million people at year-end 2025. Enrollment also tumbled by 525,000 compared to the end of the first quarter of this year when the company reported about 49 million health plan members.
