UnitedHealth Group unites its health plans with consumers across the US. A leading health insurer, it offers a variety of plans and services to group and individual customers nationwide. Its UnitedHealthcare health benefits segment manages HMO, PPO, and POS (point-of-service) plans, as well as Medicare, Medicaid, state-funded, and supplemental vision and dental options. Together, the UnitedHealthcare businesses serve about 38 million members. In addition, UnitedHealth's Optum health services units -- OptumHealth, OptumInsight, and OptumRx -- provide wellness and care management programs, financial services, information technology solutions, and pharmacy benefit management (PBM) services.
Within the universe of UnitedHealth, UnitedHealthcare is king, with the core health benefits segment accounting for more than three-fourths of annual revenues. The UnitedHealthcare Employer & Individual unit, which serves 26 million members through its plans for students, families, individuals, and businesses (ranging from sole proprietorships to multinational enterprises), is the largest health benefits business, with the UnitedHealthcare Medicare & Retirement senior services unit not far behind. A smaller division, UnitedHealthcare Community & State, manages public Medicaid programs for disabled and disadvantaged citizens. All health benefits products share a provider network of some 750,000 doctors and 5,400 hospitals nationwide.
Sales and Marketing
UnitedHealth's insurance products are largely sold through independent brokers and consultants, as well as some direct and online sales programs.
However, UnitedHealth is not immune to market fluctuations, and as a provider of workplace benefits, UnitedHealth can be particularly vulnerable to massive layoffs occurring during troubled economic times. Workplace attrition contributed to a significant decline in UnitedHealthcare's commercial membership in 2009; however, the trend reversed itself in 2010 and 2011 despite a continuingly challenged employment market, and growth in public and senior market plan enrollment levels were strong enough to help keep UnitedHealth's revenue and income levels climbing all three years. In 2011 the company reported an 8% increase in revenues to some $101.9 billion, as well as a 10% rise in profits to $5.1 billion.
Uncertainty over future impacts of federal health reform measures in the US is also a concern for the company. Like many US health insurers, UnitedHealth has worked to insulate itself against economic and market concerns by increasing its commercial premium rates in response to rising medical costs.
UnitedHealth has prospered to become the largest US health insurer, in part, by expanding into new regions through the purchase of smaller rivals and corporate health plans. Growth in the diversified health services businesses, which are grouped under the Optum umbrella, have also helped UnitedHealth continue to grow despite economic challenges, especially as the company has been working to expand its wellness and information technology services to meet the growing needs of clients as the US health care landscape undergoes reform measures.
For instance, OptumHealth has added personalized wellness, employee assistance, onsite screening, and other services to encourage consumers to actively participate in managing their health and seek preventative care, which helps lower overall medical costs. In addition, the UnitedHealthcare plans are promoting wellness and preventative care by partnering with community organizations (such as the New York and Long Island YMCA groups) and retailers (including Kroger and Albertson's) to educate consumers on issues such as obesity and diabetes.
UnitedHealth has been reshaping its OptumInsight (formerly Ingenix) business around the booming data management needs of US health providers, primarily in the implementation of electronic health record (EHR) and accountable care organization (ACO) systems, which are reimbursable through new federal health laws. To increase its emphasis on the core IT operations, OptumInsight exited most of its drug trial outsourcing business in 2011 and focused its remaining life sciences operations on regulatory and commercialization services.
In 2011 UnitedHealth moved to streamline its insurance operating divisions, moving the former AmeriChoice (for public-sector Medicaid and Medicare programs) and Ovations (Medicare for members of AARP) businesses under the broader UnitedHealthcare umbrella. By unifying its health benefit operations under UnitedHealthcare, the company hoped to unify its branding presence across all of its service territories.
UnitedHealth also combined its health services businesses under the Optum brand in 2011. While OptumHealth retained its existing name, Ingenix was rebranded as OptumInsight and Prescription Solutions became OptumRx.
Mergers and Acquisitions
The highly acquisitive company widened its senior plan offerings in 2012 by acquiring private insurer XLHealth for an undisclosed price; the purchase added some 110,000 Medicare Advantage customers in six states and also expanded the firm's joint Medicare/Medicaid offerings for special needs clients. UnitedHealth also acquired two Florida Medicare Advantage providers, Preferred Care Partners (50,000 members) and Medica HealthCare Plans (35,000 members), that year in two separate transactions. Both Preferred Care Partners and Medica HealthCare Plans also serve several thousand Medicaid beneficiaries.
In 2011 the OptumHealth unit added mobile health clinic operator Logistics Health. It also acquired Connextions, a provider of insurance call center services.
The company expanded internationally in 2012 when it purchased a majority stake in Brazilian health care firm Amil Participações; it plans to acquire the remaining shares in Amil during 2013. The purchase, worth a total of some $4.9 billion, includes the Amil Assistencia Medica Internacional health plan provider, as well as a network of hospitals and clinics in Brazil. – less