News summary: UnitedHealth warns on Medicare cuts
News summary: Insurer UnitedHealth warns of looming Medicare profit squeeze
GROWTH WARNING: UnitedHealth Group Inc., the largest provider of Medicare Advantage plans, warned Thursday that funding cuts for the privately-run versions of the federal Medicare program will force it to reconsider expectations for earnings growth next year.
THE REASON: CEO Stephen Hemsley said the government-subsidized coverage faces a reimbursement cut of about 4 percent. That's on top of other possible federal funding reductions and an expected 3 percent rise in medical costs.
ABOUT MEDICARE ADVANTAGE: Insurers offer hundreds of different plans. The insurance typically provides extras such as dental and vision coverage, or rates that are lower than standard Medicare.
