(Adds details on medical costs, background, share movement)
April 14 (Reuters) - UnitedHealth Group Inc beat Wall Street targets for quarterly profit and raised its annual forecast on Friday, as the health insurance provider banks on "market-leading" membership growth in its Medicare Advantage business.
Memberships in government-backed plans such as Medicare - which offers healthcare coverage for people aged 65 and older or those with certain disabilities - make up one-third of UnitedHealth's health insurance plans.
Shares of the Dow component were up 0.7% at $529.59 before the bell.
A slow recovery in non-urgent procedures helped lower medical costs at its insurance unit, driving the company's first-quarter profit above expectations.
Health insurers stand to benefit from inflation and labor shortages that could hinder the number of non-urgent procedures that hospitals perform during the year as that leads to lower costs from medical claims.
The company's medical cost ratio - the percentage of payout on claims compared to its premiums - came in at 82.2%, compared with analysts' estimates of 82.54%, according to Refinitiv IBES data.
UnitedHealth raised its 2023 profit forecast to between $24.50 and $25.00 per share on an adjusted basis, higher than its earlier estimate of $24.40 to $24.90. Analysts were expecting a profit of $24.94.
Excluding items, the company reported a profit of $6.26 per share for the first quarter, beating estimates of $6.13. (Reporting by Khushi Mandowara and Bhanvi Satija in Bengaluru; Editing by Devika Syamnath)
