- UnitedHealth CEO Dave Wichmann is retiring and will be replaced as chief executive by Andrew Witty, currently the CEO of health services unit Optum.
- Witty will continue running Optum and become CEO immediately, with Wichmann assisting in a transition period through March, UnitedHealth announced Thursday.
- Dirk McMahon, CEO of payer business UnitedHealthcare, will become president and chief operating officer, and joins CFO John Rex to round out the Minnetonka, Minnesota-based healthcare behemoth's C-suite. UnitedHealth's stock was up slightly in early morning trading Thursday on the news.
Wichmann's retirement ends his relatively short tenure at the diversified healthcare giant, coming as a surprise in an industry where many CEO's tenures are marked not by years, but by decades. The 59-year-old executive joined UnitedHealth in 1998, before serving as CFO from 2011 until mid-2016, when he became president. Wichmann was named CEO in September 2017 and UnitedHealth has been on a steady growth trajectory since.
Witty was named CEO of Optum in March 2018 and added the role of UnitedHealth president in November 2019.
From April to December last year, Witty took a leave of absence from UnitedHealth to serve as an envoy for the World Health Organization's COVID-19 pandemic response efforts and an adviser to the UK Government Vaccine Taskforce.
Before joining UnitedHealth, 56-year-old Witty was CEO of pharmaceutical giant GlaxoSmithKline from 2008 to 2017, and worked for the global drug and vaccine maker since 1985.
In a statement, UnitedHealth Chairman Stephen Hemsley said the board selected Witty due to the depth of his healthcare experience and leadership skills, which should help the four-decade-old company continue to drive growth. Hemsley was UnitedHealth CEO for 13 years before handing the reins to Wichmann.
Under the leadership shakeup, Dirk McMahon will become president and COO. McMahon has led UnitedHealthcare, the biggest private payer in the U.S., since June 2019. Before that, the executive was president and COO of Optum. McMahon joined UnitedHealth in 2003.
Witty is taking the helm of the second biggest healthcare company by revenue, after CVS Health. UnitedHealth brought in more than $257 billion in revenue in 2020 and profit of $15.4 billion at a time of historic volatility for healthcare companies.
However, profits did fall almost 40% in the fourth quarter as patients resumed previously delayed care. UnitedHealth reported a profit of $2.2 billion in the quarter on $65.5 billion in revenue, compared to $3.5 billion in profit on $60.9 billion in revenue in the fourth quarter of 2019.
The company expects to bring in adjusted net earnings of $17.75 to $18.25 a share in 2021.