PacifiCare Health Systems Inc., boosted by membership growth and less money paid to doctors for treating enrollees, said Thursday its third-quarter profit was up 34% from a year ago, handily beating Wall Street’s predictions.
The Cypress-based health insurer said it earned $118.1 million in the quarter, up from $88.2 million a year ago. Revenue was up 21% to $3.8 billion.
Analysts had expected PacifiCare to earn $88.5 million on revenue of $3.67 billion in the quarter.
PacifiCare said enrollment in its health plans was up 13% from a year ago to 3.4 million people. The company’s “medical loss ratio”,the percentage of revenue spent to pay for members’ medical care, improved 1.2 percentage points to 82.9%.
PacifiCare also upped its outlook for the rest of the year. It now expects $338 million to $343 million in annual profit, up from a prior forecast of $324 million to $337.5 million.
Including charges, PacifiCare said it should earn $318.2 million to $322.6 million in 2005, and expects revenue growth of 17.5% from last year’s $12.2 billion.
PacifiCare’s shares edged up in Thursday trading and are up 38% since the start of 2005.
UnitedHealth Group Inc., the Minnesota-based managed care company, is in the process of buying PacifiCare for $8.1 billion, in a deal expected to close late this year or early in 2006.
