UnitedHealth Group has posted a fall in profit for 2025, related to Medicare funding reductions and costs tied to the Change Healthcare cyberattack.

The insurer’s net earnings attributable to its common shareholders fell to $12.1bn in 2025, down 16% from $14.4bn in the previous year.

The decrease was partly driven by a $1.6bn charge, net of taxes, in the fourth quarter (Q4).

The company also attributed the decline to “accelerating medical cost trends”.

Its adjusted medical care ratio rose to 88.9% in 2025, up from 85.5% in the prior year.

However, total revenue for the year increased 12% to $447.5bn, from $400.2bn in 2024.

The UnitedHealthcare Employer & Individual segment reported revenues of $79.2bn, up slightly from $78.2bn last year.

Revenues in the UnitedHealthcare Medicare & Retirement segment rose to $171.3bn, representing an increase of $31.8bn, or 23%, linked to a rise in the number of people served and impacts from the Inflation Reduction Act Part D provisions.

The Community & State division saw revenue growth of 17% year-on-year, reaching $94.4bn, due to greater service for individuals with complex needs and higher Medicaid rates.

For Q4, net earnings attributable to shareholders stood at $10m, compared with $5.5bn reported a year earlier.

Quarterly revenues increased to $113.2bn from $100.8bn in the same period of 2024.

Guidance for 2026 projects revenues was above $439bn, a 2% decrease as a result of “planned right-sizing across the enterprise”.

The company anticipates earnings from operations of more than $24bn and forecasts a net margin near 3.6%, compared with 2.7% reported for 2025.

UnitedHealth Group CEO Stephen Hemsley said: “We confronted challenges directly and finished 2025 as a much stronger company, giving us the momentum to better serve those who count on us and continue to improve our core performance.”

Earlier this month, findings from a US Senate Judiciary Committee investigation, published by the Wall Street Journal, alleged that UnitedHealth Group employed assertive tactics to obtain higher payments for Medicare Advantage members by boosting diagnoses qualifying for additional funding.

The committee reviewed approximately 50,000 pages of company documents supplied by UnitedHealth in its inquiry.

Meanwhile, the Trump administration recently proposed an average payment increase of 0.09% next year for private insurers managing Medicare Advantage plans.

The government expects this rate update will lead to more than $700m in extra payments by 2027.