UnitedHealth Touts Clinical Assets in 2Q Earnings Call

by Leslie Small

UnitedHealth Group — which in recent months has been tightening the screws on spending drivers like unnecessary emergency care and out-of-network utilization — is signaling that its greater goal for cost containment comprises much more than simply site-of-care management. Rather, the company's emphasis on its care-delivery assets during its second-quarter earnings conference call may suggest that UnitedHealth is increasingly pursuing the strategy of "if you can’t beat them, own them."

Pushing practices toward value-based care:

• "I think you're really starting to see OptumHealth…starting to demonstrate [its] capacity for growth because of the scale of the footprint that they now [have] established across the country," UnitedHealth CEO Andrew Witty said of the company's health services division during a July 15 call to discuss quarterly earnings.
• OptumHealth expects to add about 10,000 clinicians this year, and "we're well over halfway through that journey," Witty said.
• Beyond "simply having the practices and the clinicians," UnitedHealth is placing an ever-increasing focus on shifting how care is delivered and reimbursed.
• Wyatt Decker, M.D., who is the CEO of OptumHealth, noted that the UnitedHealth subsidiary is particularly focused on taking best practices from markets that have used capitated payment models for years — such as Texas and Southern California — and transferring them to markets that have historically been fee-for-service-centric, such as the Pacific Northwest and the Northeast.

UnitedHealth's 2Q performance:

• As health care utilization levels have begun to return to normal after ultra-high, peak-pandemic care deferral levels last year, UnitedHealth's medical loss ratio (MLR) has ticked back up to 82.8% compared with 70.2% in the year-ago quarter. Still, UnitedHealth's MLR beat the Wall Street consensus estimate of 83%, observed Citi analyst Ralph Giacobbe in a July 15 research note.
• The firm continues to expect a $1.80 COVID-related negative impact on its earnings per share (EPS) for 2021 as a whole, with most of those effects predicted in the second half of the year.
• During the second quarter, UnitedHealth recorded an adjusted EPS of $4.70, beating the consensus of $4.43.

From Health Plan Weekly