UnitedHealth Group Inc.'s fourth-quarter net income slipped 1 percent, as growing medical costs countered revenue gains for the nation's largest health insurer.
The Minnetonka, Minn., company said Thursday that it earned $1.24 billion, or $1.20 per share, in the three months that ended Dec. 31. That compares with $1.26 billion, or $1.17 per share, in the last quarter of 2011, when the company had more shares outstanding.
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Total revenue climbed 11 percent to $28.77 billion, but medical costs or claims grew 12 percent to $20.8 billion.
Analysts forecast, on average, earnings of $1.20 per share on $28.23 billion in revenue, according to FactSet.
UnitedHealth's operating costs also climbed 13 percent to $4.85 billion, and it recorded a smaller gain of $140 million in the quarter due to claims left over from earlier periods coming in lower than expected. That compares with a $310 million gain in the final quarter of 2011.
UnitedHealth said in October it would spend about $4.9 billion to buy a majority stake in Brazilian health benefits and care provider Amil Participacoes SA. The company is the largest health insurer in Brazil and also owns hospitals and clinics.
The insurer's enrollment jumped 18 percent in the quarter to 40.9 million people, compared to the 2011 quarter. That was largely due to the addition of the Brazilian business.
The company said it still expects 2013 earnings to range between $5.25 and $5.50 per share. Analysts forecast $5.56 per share.
UnitedHealth is the first insurer to report earnings every quarter. Many see it as a bellwether for other insurers.