A surprising Medicare Advantage cost spike helped push UnitedHealth into a rare deep dive Thursday, after the health care giant chopped its 2025 forecast following a worse-than-expected first quarter.

The Eden Prairie-based company’s stock price sank by about $130 in its worst one-day performance in over 25 years. Its first-quarter report also rattled other health insurers.

UnitedHealth leaders said care use from people enrolled in its Medicare Advantage plans wound up increasing at twice the rate they had planned for the quarter.

That contributed to an overall performance that was “frankly unusual and unacceptable,” CEO Andrew Witty told analysts during a conference call. But he emphasized that this was a temporary, fixable issue.

The unexpected use spike did not extend to the company’s other lines of coverage, which include commercial insurance and state-and federally funded Medicaid plans.

UnitedHealth Group Inc. operates the nation’s largest health insurer, UnitedHealthcare, which covers more than 50 million people. It also has a large pharmacy benefit manager that runs prescription drug coverage and a growing Optum segment that delivers care and provides technical support.

With more than 8 million customers, UnitedHealthcare is the nation’s largest provider of Medicare Advantage plans. Those are privately run versions of the federal government coverage program mostly for people ages 65 and older.

Overall, UnitedHealth posted a $6.3 billion profit in the quarter. That compares to a $1.41 billion loss last year, when the company absorbed heavy costs from a cyberattack on its Change Healthcare business.

Adjusted earnings totaled $7.20 per share on $109.58 billion in revenue in this year’s first quarter.

Analysts expect earnings of $7.29 per share on $111.53 billion in sales, according to the data firm FactSet.

For 2025, UnitedHealth now predicts adjusted earnings ranging from $26 to $26.50 per share. The company initially forecasted earnings of $29.50 to $30 in December. It then reaffirmed that outlook in January.

Analysts forecast earnings of $29.72 per share.

Company shares fell 22% to $454.15 on Thursday. That weighed on the Dow Jones age, of which UnitedHealth is a component.

UnitedHealth is the first insurer to report results every quarter. Many see it as a sector bellwether.

— Associated Press

State adds 10,700 jobs, jobless rate 3.1%

Minnesota added 10,700 jobs in March, the largest monthly gain in a year, and state’s unemployment rate rose to 3.1%, according to data released Thursday by the state Department of Employment and Economic Development.

The state’s unemployment rate was up 0.1 percentage point from last month, and compared with 4.2% nationally, DEED said. The rise in unemployment, even though state added jobs, can be attributed to more people entering the workforce. More than 2,700 Minnesotans joined the labor force last month.

Minnesota has gained 37,581 jobs, over the past year, faster than the national rate of growth.

Mortgage rates spike on Treasury moves

The average rate on a 30-year mortgage in the U.S. climbed to its highest level in eight weeks, a setback for home shoppers in the midst of the spring homebuying season.

The rate rose to 6.83% from 6.62% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 7.1%.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, increased to 6.03% from 5.82% last week.

Mortgage rates are influenced by several factors, including global demand for U.S. Treasurys, the Federal Reserve’s interest rate policy decisions and bond market investors’ expectations for future inflation.

— From news services