UnitedHealth Group (NYSE: UNH) reported earnings  for its third quarter this morning, and things are looking healthy at the nation's largest health insurer, with overall net revenue up 8% for the quarter to $27.3 billion. Though this fell short of analyst expectations of $27.6 billion, earnings per share were up 23% from the same quarter last year, to $1.50 per share, partially because of its growth in its Medicare and Medicaid business.

What happened this quarter
There was big news last month when CME Group (Nasdaq: CME) announced that UnitedHealth would be replacing Kraft (Nasdaq: KRFT) on the venerable list of 30 companies that make up the Dow Jones Industrial Average (INDEX: ^DJI), prompted primarily by Kraft's decision to split its business in two. UnitedHealth is no slacker in its own right, however, and the impact of the Affordable Care Act on health insurance companies may not be fully realized for a few years.

They also expanded operations with the purchase of a majority stake in Amil Participacoes SA, Brazil's largest health insurer and hospital operator, spending $4.9 billion in the process. With competitors like Aetna (NYSE: AET) and WellPoint (NYSE: WLP) focused on acquisitions in the U.S. in anticipation of future growth in the Medicare and Medicaid programs in the U.S., UnitedHealth's expanded operations in Brazil join recently launched ventures in Australia, the Middle East, and the United Kingdom during the past year.

What to expect going forward
The company also raised its earnings guidance for the year, expecting to earn between $5.20 and $5.25 a share. While health insurance is its biggest business, UnitedHealth expects big things from its Optum business going forward. The provider of services -- such as health-management and wellness programs, technology outsourcing, and pharmacy benefits -- had flat revenue this quarter when compared to last year, but operating expenses did climb by 28% to $408 million during the quarter.

Finally, the Amil acquisition, if approved, won't fully be felt until next year, but UnitedHealth has stated that the deal will "slightly increase" its earnings per share in 2013.


Fool contributor Robert Eberhard has no positions in the stocks mentioned above. Follow him on Twitter, or click here to see his holdings and a short bio. The Motley Fool owns shares of CME Group and WellPoint. Motley Fool newsletter services recommend UnitedHealth Group and WellPoint. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.