April 23 (Reuters) - Molina Healthcare MOH.N beat Wall Street estimates for first-quarter earnings on Wednesday, driven by an increase in premiums from its government-backed Medicaid insurance plans for people with low income.

The company reaffirmed its full-year 2025 forecast with premium revenue expected to be about $42 billion and adjusted profit of at least $24.50 per share.

Quarterly premium revenue rose about 12% to $10.63 billion, partially aided by new contract wins, beating estimates of $10.39 billion, according to data compiled by LSEG.

Higher expenses tied to patient claims in government-backed Medicare plans for older adults and changes in enrollment to Medicaid plans have weighed on the industry for more than a year.

Larger rival UnitedHealth UNH.N last week lowered its full-year profit forecast and, for the first time since 2008 financial crisis, missed its quarterly profit estimates, partly due to high spending on its Medicare Advantage plans for older adults and those with disabilities.

Molina Healthcare primarily focuses on Medicaid plans, a combined federal and state initiative that provides health insurance to low-income individuals and families.

Quarterly medical cost ratio, the percentage of premiums spent on medical care, in Medicaid plans was 90.3% which was in line with Molina's expectations.

Medical costs increased moderately, as expected, partially due to demand of behavioral health services, as well as seasonal illnesses, the company said.

UnitedHealth and Elevance ELV.N have said that the demand for services within their Medicaid plans aligned with their expectations.

The consolidated ratio for the first quarter of 2025 was 89.2%, reflecting "strong medical cost management", Molina said.

Analysts had expected the ratio, which helps track medical costs, to be 88.5%. Companies typically aim for a ratio closer to 80%.

The health insurer reported a first-quarter adjusted profit of $6.08 per share, above Wall Street estimates of $5.96 per share.

(Reporting by Sriparna Roy in Bengaluru; Editing by Mohammed Safi Shamsi)

((Sriparna.Roy@thomsonreuters.com;))