Dive Brief:
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Full-year operating earnings for UnitedHealth Group totaled $13.3 billion last year – a 20.5% increase – and total revenues grew by 18%, totaling $184.8 billion, according to the company's 4Q 2016 financial statement.
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Strong financial performance was buoyed by Optum, the UnitedHealth division that provides pharmacy benefits management and technology services to payers and providers, where revenues increased 23.7% from the previous year to $83.6 billion, the company stated.
- Despite scaling back participation in individual health insurance exchanges, the statement showed revenues from UnitedHealth’s insurance business, UnitedHealthcare, increased 13.1% from the previous year to $148.6 billion.
Dive Insight:
UnitedHealth can be seen as a model for payer success in an era of uncertainty for healthcare reform. Despite struggles selling plans on ACA exchanges, strong financial performance by the Fortune 50 company was driven in part by gains in its commercial, Medicare, and Medicaid lines of business, as well as at Optum.
UnitedHealth plans to expand in the future, CNBC reported. Also, the financial report highlighting its continued growth comes just a few days after it announced plans to acquire Surgical Care Affiliates (SCA) for about $2.3 billion, which will become part of will become part of Optum.
With the future of the ACA up in the air as President-elect Donald Trump and a Republican-controlled Congress promise significant changes, UnitedHealth is still poised for a strong financial performance in 2017, according to CEO Stephen J. Hemsley. The payer estimated that total revenues would approach $200 billion this year.
Hemsley expressed confidence during an earnings call that diverse offerings and flexibility would allow UnitedHealth to maintain strong financial performance. “We think we have been developing the kind of assets and capabilities to serve a healthcare system and can accommodate a variety of approaches,” he said.