UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________________________________
Form 10-K
_______________________________________________________
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission file number: 1-10864
__________________________________________________________
UnitedHealth Group Incorporated
(Exact name of registrant as specified in its charter)
Delaware
41-1321939
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
1 Health Drive
55344
655 New York Avenue NW
20001
Eden Prairie,
Minnesota
Washington,
DC
(Address of principal executive offices)
(Zip Code)
(Address of principal executive offices)
(Zip Code)
(800) 328-5979
(Registrant’s telephone number, including area code)
______________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $.01 par value
UNH
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
_________________________________________________________
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the
registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of voting stock held by non-affiliates of the registrant as of June 30, 2024 was $468,433,146,650 (based on the last reported sale price of $509.26 per
share on June 30, 2024 as reported on the New York Stock Exchange), excluding only shares of voting stock held beneficially by directors, executive officers and subsidiaries of
the registrant.
As of January 31, 2025, there were 914,712,333 shares of the registrant’s Common Stock, $.01 par value per share, issued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
The information required by Part III of this report, to the extent not set forth herein, is incorporated by reference from the registrant’s definitive proxy statement relating to its 2025
Annual Meeting of Shareholders. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this
report relates.
UNITEDHEALTH GROUP
Table of Contents
Page
Part I
Item 1.
Business ....................................................................................................................................
1
Item 1A.
Risk Factors ..............................................................................................................................
10
Item 1B.
Unresolved Staff Comments .....................................................................................................
20
Item 1C.
Cybersecurity ............................................................................................................................
21
Item 2.
Properties ..................................................................................................................................
22
Item 3.
Legal Proceedings .....................................................................................................................
22
Item 4.
Mine Safety Disclosures ...........................................................................................................
22
Part II
Item 5.
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities .............................................................................................................
22
Item 6.
Reserved ....................................................................................................................................
23
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations ...
24
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk ..................................................
36
Item 8.
Financial Statements and Supplementary Data .........................................................................
37
Item 9.
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure ..
67
Item 9A.
Controls and Procedures ...........................................................................................................
67
Item 9B.
Other Information .....................................................................................................................
69
Item 9C.
Disclosure Regarding Foreign Jurisdictions That Prevent Inspections ....................................
69
Part III
Item 10.
Directors, Executive Officers and Corporate Governance ........................................................
69
Item 11.
Executive Compensation ..........................................................................................................
70
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters .............................................................................................................
70
Item 13.
Certain Relationships and Related Transactions, and Director Independence .........................
70
Item 14.
Principal Accountant Fees and Services ...................................................................................
70
Part IV
Item 15.
Exhibit and Financial Statement Schedules ..............................................................................
71
Item 16.
Form 10-K Summary ................................................................................................................
79
Signatures ............................................................................................................................................................
80
PART I
ITEM 1.
BUSINESS
OUR BUSINESSES
Overview
The terms “we,” “our,” “us,” “its,” “UnitedHealth Group,” or the “Company” used in this report refer to UnitedHealth Group
Incorporated and its subsidiaries.
UnitedHealth Group Incorporated is a health care and well-being company with a mission to help people live healthier lives and
help make the health system work better for everyone. Our two distinct, yet complementary businesses — Optum and
UnitedHealthcare — are working to help build a modern, high-performing health system through improved access,
affordability, outcomes and experiences for the individuals and organizations we are privileged to serve.
The ability to analyze complex data and apply deep health care expertise and insights allows us to serve patients, consumers,
care providers, businesses, communities and governments with more innovative products and complete, end-to-end offerings
for many of the biggest challenges facing health care today.
Optum seeks to create a higher-performing, value-oriented and more connected approach to health care. Bringing together
clinical expertise, technology and data to make care simpler, more effective and more affordable, we seek to advance whole-
person health, creating a seamless consumer experience and supporting clinicians with insights to deliver personalized,
evidence-based care. Optum serves the broad health care marketplace, including patients and consumers, payers, care providers,
employers, governments and life sciences companies, through its Optum Health, Optum Insight and Optum Rx businesses.
These businesses improve overall health system performance by optimizing health care quality and delivery, reducing costs and
improving patient, consumer and provider experience, leveraging distinctive capabilities in data and analytics, pharmacy care
services, health care operations, population health and health financial services.
UnitedHealthcare offers a full range of health benefits, designed to simplify the health care experience and make it more
affordable for consumers to access high-quality care. UnitedHealthcare Employer & Individual serves consumers and
employers, ranging from sole proprietorships to large, multi-site and national employers and public sector employers.
UnitedHealthcare Medicare & Retirement delivers health and well-being benefits to seniors and other Medicare eligible
consumers. UnitedHealthcare Community & State serves consumers who are economically disadvantaged, the medically
underserved and those without the benefit of employer sponsored health benefits coverage.
We have four reportable segments:
•
Optum Health;
•
Optum Insight;
•
Optum Rx; and
•
UnitedHealthcare, which includes UnitedHealthcare Employer & Individual, UnitedHealthcare Medicare & Retirement
and UnitedHealthcare Community & State.
Optum
Optum is an information and technology-enabled health services business serving the broad health care marketplace, including:
•
Those who need care: patients who need the right care, information, resources, products and engagement to improve
their health, achieve their health goals and receive an improved patient experience that is personalized, comprehensive
and delivered in all care settings, including in-home and virtually.
•
Those who provide care: physicians, hospitals, pharmacies and others seeking to improve the health system and reduce
the administrative burden, allowing for providers to focus time on patients leading to the best possible patient care and
experiences while achieving better health outcomes at lower costs. Improved health outcomes are achieved by utilizing
our clinical expertise, data and analytics to better understand, treat and prevent consumers’ health conditions and ensure
they receive the best evidence-based care.
•
Those who pay for care: consumers; employers; health plans; and state, federal and municipal agencies devoted to
ensuring the people they sponsor receive high-quality care, administered and delivered efficiently and effectively, all
while driving health equity so that every individual, family and community has access to the care they need.
•
Those who innovate for care: global life sciences organizations dedicated to developing more effective approaches to
care, enabling technologies and medicines to improve care delivery and health outcomes.
1
Optum operates three business segments which combine distinctive capabilities in value-based care, population health, health
care operations, data and analytics and pharmacy care services:
•
Optum Health delivers patient-centered care, care management, wellness and consumer engagement, and health financial
services;
•
Optum Insight offers data, analytics, research, consulting, technology and managed services solutions; and
•
Optum Rx provides diversified pharmacy care services.
Optum Health
Optum Health provides comprehensive and patient-centered care, addressing the physical, mental, social, and financial well-
being of 100 million consumers and serves more than 100 health payer partners. We engage people in the most appropriate care
settings, including clinical sites, in-home and virtual. Optum Health delivers primary, specialty and surgical care; helps patients
and providers navigate and address complex, chronic and behavioral health needs; offers post-acute care planning services; and
serves consumers and care providers through advanced, on-demand digital health technologies, such as telehealth and remote
patient monitoring, and innovative health care financial services. Optum Health works directly with patients, consumers, care
delivery systems, providers, employers, payers, and public-sector entities to provide high quality, accessible and equitable care
with improved health outcomes and reduced total cost of care. Optum Health enables care providers to transition from
traditional fee-for-service payment models to performance-based delivery and payment models designed to improve patient
health outcomes and experience through value-based care.
Optum Health offerings include fully accountable value-based arrangements, where Optum Health assumes responsibility for
health care costs in exchange for a monthly premium. Offerings also include administrative fee arrangements, where Optum
Health manages or administers products and services in exchange for a monthly fee, and fee-for-service arrangements, where
Optum Health delivers health-related products and medical services for patients at a contracted fee.
Optum Financial, including Optum Bank, serves consumers through more than 27 million consumer accounts with $24 billion
in assets under management as of December 31, 2024. Organizations across the health system rely on Optum Financial to
manage and improve payment flows through its highly automated, scalable, end-to-end digital payment and financing systems
and integrated card solutions. For financial services offerings, Optum Financial charges fees and earns investment income on
managed funds.
Optum Health sells its products primarily through its direct sales force, strategic collaborations and external producers in three
key areas: employers, including large, mid-sized and small employers; payers including health plans, third-party administrators
(TPAs), underwriter/stop-loss carriers and individual product intermediaries; and public entities, including the U.S.
Departments of Health and Human Services (HHS), Veterans Affairs, Defense, and other federal, state and local health care
agencies.
Optum Insight
Optum Insight connects the health care system with services, analytics and platforms that make clinical, administrative and
financial processes simpler and more efficient for all participants in the health care system. Hospital systems, physicians, health
plans, public entities, life sciences companies and other organizations comprising the health care industry depend on Optum
Insight to help them improve performance and reduce costs through administrative efficiency and payment simplification,
advance care quality through evidence-based standards built directly into clinical workflows, meet compliance mandates and
modernize their core operating systems to meet the changing needs of the health system.
Health Systems. Serves hospitals, physicians and other care providers to improve operating performance, better coordinate care
and reduce administrative costs through technology and services to improve population health management, patient
engagement, revenue cycle management and strategic growth plans.
Health Plans. Serves health plans by improving financial performance and enhancing outcomes through proactive analytics, a
comprehensive payment integrity portfolio and technology-enabled and staff-supported risk and quality services. Optum Insight
helps health plans navigate a dynamic environment defined by shifts in employer vs. public-sector coverage, the demand for
affordable benefit plans and the need to leverage new technology to reduce complexity.
State Governments. Provides advanced technology and analytics services to modernize the administration of critical safety net
programs, such as Medicaid, while improving cost predictability.
Life Sciences Companies. Combines data and analytics expertise with comprehensive technologies and health care knowledge
to help life sciences companies, including those in pharmaceuticals and medical technology, adopt a more comprehensive
approach to advancing therapeutic discoveries and improving clinical outcomes.
2
Many of Optum Insight’s software and information products and professional services are delivered over extended periods,
often several years. Optum Insight maintains an order backlog to track unearned revenues under these long-term arrangements.
The backlog consists of estimated revenue from signed contracts, other legally binding agreements and anticipated contract
renewals based on historical experience with Optum Insight’s customers. Optum Insight’s aggregate backlog as of December
31, 2024 was approximately $32.8 billion, of which $19.8 billion is expected to be realized within the next 12 months. The
aggregate backlog includes $12.5 billion related to affiliated agreements. Optum Insight’s aggregate backlog as of December
31, 2023, was $32.1 billion, including $11.9 billion related to affiliated agreements.
Optum Insight’s products and services are sold primarily through a direct sales force. Optum Insight’s products are also
supported and distributed through an array of alliances and business partnerships with other technology vendors, who integrate
and interface Optum Insight’s products with their applications.
Optum Rx
Optum Rx provides a full spectrum of pharmacy care services through its network of more than 65,000 retail pharmacies,
through home delivery, specialty and community health pharmacies, the provision of in-home and community-based infusion
services and through rare disease and gene therapy support services. It also offers direct-to-consumer solutions.
Optum Rx manages a broad range of prescription drug spend, including widely available retail drugs as well as limited and
ultra-limited distribution drugs in oncology, HIV, pain management and ophthalmology. Optum Rx serves the growing
pharmacy needs of people with behavioral health and substance use disorders. In 2024, Optum Rx managed $178 billion in
pharmaceutical spending, including $74 billion in specialty pharmaceutical spending.
Optum Rx serves health benefits providers, large national employer plans, unions and trusts, purchasing coalitions and public-
sector entities. Optum Rx sells its services through direct sales, health insurance brokers and other health care consultants.
Optum Rx offers multiple clinical programs, digital tools and services to help clients manage overall pharmacy and health care
costs in a clinically appropriate manner which are designed to deliver improved consumer experiences, better health outcomes
and a lower total cost of care. Optum Rx provides various utilization management, medication management, quality assurance,
adherence and counseling programs to complement each client’s plan design and clinical strategies. Optum Rx is accelerating
the integration of medical, pharmacy and behavioral care and treating the whole patient by embedding our pharmacists as key
members of the patient care team.
UnitedHealthcare
Through its health benefits offerings, UnitedHealthcare is enabling better health, creating a better health care experience for its
customers and helping to control rising health care costs. UnitedHealthcare’s market position is built on:
•
strong local-market relationships;
•
the breadth of product offerings, based upon extensive expertise in distinct market segments in health care;
•
service and advanced technology, including digital consumer engagement;
•
competitive medical and operating cost positions;
•
effective clinical engagement; and
•
innovation for customers and consumers.
UnitedHealthcare arranges for discounted access to care through its extensive networks and uses Optum’s capabilities to help
coordinate and provide patient care, improve affordability of medical care, analyze cost trends, manage pharmacy care services,
work with care providers more effectively and create a simpler and more satisfying consumer and physician experience.
UnitedHealthcare is subject to extensive government regulation. See further discussion of our regulatory environment below
under “Government Regulation” and in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and
Results of Operations.”
UnitedHealthcare Employer & Individual
Domestically, UnitedHealthcare Employer & Individual offers a comprehensive array of consumer-oriented health benefit plans
and services for large national employers, public sector employers, mid-sized employers, small businesses, and individuals. As
of December 31, 2024, UnitedHealthcare Employer & Individual provides access to medical services for 29.7 million people.
Through its risk-based product offerings, UnitedHealthcare Employer & Individual assumes the risk of both medical and
administrative costs for its customers in return for a monthly premium which is typically a fixed rate per individual served for a
one-year period. Through its administrative and other management services arrangements to customers who elect to self-fund
the health care costs of their employees and employees’ dependents, UnitedHealthcare Employer & Individual receives a fixed
3
monthly service fee per individual served. These customers retain the risk of financing medical benefits for their employees and
employees’ dependents, while UnitedHealthcare Employer & Individual provides services such as coordination and facilitation
of medical and related services to customers, consumers and health care professionals, administration of transaction processing
and access to a contracted network of physicians, hospitals and other health care professionals, including dental and vision
professionals. UnitedHealthcare Employer & Individual is focused on providing informed benefit solutions that create
customized plan designs and clinical programs for employers that contribute to well-being and reduce the total cost of care
along with providing simpler consumer experiences in response to market dynamics.
UnitedHealthcare Employer & Individual typically distributes its products through a variety of channels, dependent upon the
specific product, including: through consultants or direct sales, in collaboration with brokers and agents, through wholesale
agents or agencies who contract with health insurance carriers to distribute individual or group benefits, through professional
employer organizations and associations and through both multi-carrier and its own proprietary private exchange marketplaces.
UnitedHealthcare Employer & Individual’s major product families include consumer engagement products, such as high-
deductible consumer driven benefit plans and a variety of innovative consumer centric products; traditional products; clinical
and pharmacy products; and specialty benefits, such as vision, dental, accident protection, critical illness, disability and hospital
indemnity offerings.
UnitedHealthcare Medicare & Retirement
UnitedHealthcare Medicare & Retirement provides health and well-being services to seniors and other Medicare eligible
consumers, addressing their unique needs. UnitedHealthcare Medicare & Retirement has distinct benefit designs, pricing,
underwriting, clinical program management and marketing capabilities dedicated to health products and services in this market.
UnitedHealthcare Medicare & Retirement offers a selection of products allowing people choice in obtaining the health coverage
and services they need as their circumstances change. These offerings include care management and health system navigator
services, clinical management programs, nurse health line services, 24-hour access to health care information, access to
discounted health services from a network of care providers and administrative services.
UnitedHealthcare Medicare & Retirement has extensive distribution capabilities and experience, including direct marketing to
consumers on behalf of its key clients, a membership organization, and state and U.S. government agencies. Products are also
offered through agents, employer groups and digital channels.
Major product categories include:
Medicare Advantage. Provides health care coverage for seniors and other eligible Medicare beneficiaries through the Medicare
Advantage program administered by the Centers for Medicare & Medicaid Services (CMS), including Medicare Advantage
HMO plans, Preferred Provider Organization (PPO) plans, Point-of-Service plans, Private-Fee-for-Service plans and Special
Needs Plans (SNPs). Under the Medicare Advantage program, UnitedHealthcare Medicare & Retirement provides health
benefits coverage in exchange for a fixed monthly premium per member from CMS plus, in some cases, monthly consumer
premiums. Premium amounts received from CMS vary based on the geographic areas in which individuals reside; demographic
factors such as age, gender and institutionalized status; and the health status of the individual. UnitedHealthcare Medicare &
Retirement served 7.8 million people through its Medicare Advantage products as of December 31, 2024.
We have continued to enhance our offerings, focusing on more digital and physical care resources in the home, expanding our
concierge navigation services and enabling the home as a safe and effective setting for care. For example, through our
HouseCalls program, nurse practitioners performed 2.9 million clinical preventive home care visits in 2024 to address unmet
care opportunities and close gaps in care.
Medicare Part D. Provides Medicare Part D benefits to beneficiaries through its Medicare Advantage and stand-alone Medicare
Part D plans. The stand-alone Medicare Part D plans address a large spectrum of people’s needs and preferences for their
prescription drug coverage, including low-cost prescription options. As of December 31, 2024, UnitedHealthcare enrolled 10.1
million people in the Medicare Part D programs, including 3.1 million individuals in stand-alone Medicare Part D plans, with
the remainder in Medicare Advantage plans incorporating Medicare Part D coverage.
Medicare Supplement. Provides a full range of supplemental products at diverse price points. These products cover various
levels of coinsurance and deductible gaps to which seniors are exposed in the traditional Medicare program. UnitedHealthcare
Medicare & Retirement served 4.3 million seniors nationwide through various Medicare Supplement products as of December
31, 2024.
Premium revenues from CMS represented 40% of UnitedHealth Group’s total consolidated revenues for the year ended
December 31, 2024, most of which were generated by UnitedHealthcare Medicare & Retirement.
4
UnitedHealthcare Community & State
UnitedHealthcare Community & State is dedicated to serving state programs caring for the economically disadvantaged, the
medically underserved and those without the benefit of employer-funded health care coverage, typically in exchange for a
monthly premium per member from the state program. UnitedHealthcare Community & State’s primary customers oversee
Medicaid plans, including Temporary Assistance to Needy Families; Children’s Health Insurance Programs (CHIP); Dual SNPs
(DSNPs); Long-Term Services and Supports (LTSS); Aged, Blind and Disabled; and other federal, state and community health
care programs. As of December 31, 2024, UnitedHealthcare Community & State participated in programs in 33 states and the
District of Columbia, and served more than 7.4 million people; including 1.2 million people through Medicaid expansion
programs in 20 states under the Patient Protection and Affordable Care Act (ACA).
States using managed care services for Medicaid beneficiaries select health plans by using a formal bid process or by awarding
individual contracts. These health plans and care programs are designed to address the complex needs of the populations they
serve, including the chronically ill, people with disabilities and people with a higher risk of medical, behavioral and social
conditions. UnitedHealthcare Community & State administers benefits for the unique needs of children, pregnant women,
adults, seniors and those who are institutionalized or are nursing home eligible. These individuals often live in medically
underserved areas and are less likely to have a consistent relationship with the medical community or a care provider. They also
often face significant social and economic challenges.
GOVERNMENT REGULATION
Our businesses are subject to comprehensive U.S. federal and state and international laws and regulations. We are regulated by
agencies which generally have discretion to issue regulations and interpret and enforce laws and rules. U.S. federal and state
and international governments continue to consider and enact various legislative and regulatory proposals which could
materially impact certain aspects of the health care system. New laws, regulations and rules, or changes in the interpretation of
existing laws, regulations and rules, including as a result of changes in the political environment, could adversely affect our
businesses.
See Part I, Item 1A, “Risk Factors” for a discussion of the risks related to our compliance with U.S. federal and state and
international laws and regulations.
U.S. Federal Laws and Regulation
When we contract with the federal government, we are subject to federal laws and regulations relating to the award,
administration and performance of U.S. government contracts. CMS regulates our UnitedHealthcare businesses and certain
aspects of our Optum businesses. Payments by CMS to our businesses are subject to regulations, including those governing fee-
for-service and the submission of information relating to the health status of enrollees for purposes of determining the amounts
of certain payments to us. CMS also has the right to audit our performance to determine our compliance with CMS contracts
and regulations and the quality of care we provide to Medicare beneficiaries. Our commercial business is further subject to
CMS audits related to medical loss ratios (MLRs) and risk adjustment data.
UnitedHealthcare Community & State has Medicaid and CHIP contracts, which are subject to federal regulations regarding
services to be provided to Medicaid enrollees, payment for those services and other aspects of these programs. There are many
regulations affecting Medicare and Medicaid compliance, and the regulatory environment with respect to these programs is
complex.
Our businesses are also subject to laws and regulations relating to consumer protection, anti-fraud and abuse, anti-kickbacks,
false claims, prohibited referrals, inappropriate reduction or limitation of health care services, anti-money laundering and
securities and antitrust compliance.
Privacy, Security and Data Standards Regulation. Certain of our operations are subject to regulation under the administrative
simplification provisions of the Health Insurance Portability and Accountability Act of 1996, as amended (HIPAA), which
apply to both the group and individual health insurance markets, including self-funded employee benefit plans. Federal
regulations related to HIPAA contain minimum standards for electronic transactions and code sets and for the privacy and
security of protected health information.
Our businesses must comply with the Health Information Technology for Economic and Clinical Health Act (HITECH), which
regulates matters relating to privacy, security and data standards. HITECH imposes requirements on uses and disclosures of
health information; includes contracting requirements for HIPAA business associate agreements; extends parts of HIPAA
privacy and security provisions to business associates; adds federal data breach notification requirements for covered entities
and business associates and reporting requirements to HHS and the Federal Trade Commission (FTC) and, in some cases, to the
local media; strengthens enforcement and imposes higher financial penalties for HIPAA violations and, in certain cases,
imposes criminal penalties for individuals, including employees. In the conduct of our business, depending on the
circumstances, we may act as either a covered entity or a business associate.
5
The use and disclosure of individually identifiable health data by our businesses are also regulated in some instances by other
federal laws, including the Gramm-Leach-Bliley Act (GLBA) or state statutes implementing GLBA. These federal laws and
state statutes generally require insurers to provide customers with notice regarding how their non-public personal health and
financial information is used and the opportunity to “opt out” of certain disclosures before the insurer shares such information
with a third party, and generally prescribe safeguards for the protection of personal information. Neither the GLBA nor HIPAA
privacy regulations preempt more stringent state laws and regulations, which may apply to us, as discussed below. Federal
consumer protection laws may also apply in some instances to privacy and security practices related to personally identifiable
information.
ERISA. The Employee Retirement Income Security Act of 1974, as amended (ERISA), regulates how our services are provided
to or through certain types of employer-sponsored health benefit plans. ERISA is a set of laws and regulations subject to
interpretation by the U.S. Department of Labor (DOL) as well as the federal courts. ERISA sets forth standards on how our
business units may do business with employers who sponsor employee health benefit plans, particularly those who maintain
self-funded plans. Regulations established by the DOL subject us to additional requirements for administration of benefits,
claims payment and member appeals under health care plans governed by ERISA.
State Laws and Regulation
Health Care Regulation. Our insurance and HMO subsidiaries must be licensed by the jurisdictions in which they conduct
business. All of the states in which our subsidiaries offer insurance and HMO products regulate those products and operations.
The states require periodic financial reports and establish minimum capital or restricted cash reserve requirements. The National
Association of Insurance Commissioners (NAIC) has adopted model regulations, which require expanded governance practices
and risk and solvency assessment reporting. Most states have adopted these or similar measures to expand the scope of
regulations relating to corporate governance and internal control activities of HMOs and insurance companies. We are required
to maintain a risk management framework and file a confidential self-assessment report with state insurance regulators. We file
reports annually with Connecticut, our lead regulator, and with New York, as required by the state’s regulation.
Our health plans and insurance companies are regulated under state insurance holding company regulations. Such regulations
generally require registration with applicable state departments of insurance and the filing of reports describing capital
structure, ownership, financial condition, certain affiliated transactions and general business operations. Most state insurance
holding company laws and regulations require prior regulatory approval of acquisitions and material affiliated transfers of
assets, as well as transactions between the regulated companies and their parent holding companies or affiliates. These laws
may restrict the ability of our regulated subsidiaries to pay dividends to our holding companies.
Some of our business activity is subject to other health care-related regulations and requirements, including PPO, Managed
Care Organization (MCO), utilization review (UR), TPA, pharmacy care services, durable medical equipment or care provider-
related regulations and licensure requirements. These regulations differ from state to state and may contain network,
contracting, product and rate, licensing and financial and reporting requirements. Health care-related laws and regulations set
specific standards for delivery of services, appeals, grievances and payment of claims, adequacy of health care professional
networks, fraud prevention, protection of consumer health information, pricing and underwriting practices and covered benefits
and services. State health care anti-fraud and abuse prohibitions encompass a wide range of activities, including kickbacks for
referral of members, billing for unnecessary medical services and improper marketing. Certain of our businesses are subject to
state general agent, broker and sales distribution laws and regulations. UnitedHealthcare Community & State and certain of our
Optum businesses are subject to regulation by state Medicaid agencies which oversee the provision of benefits to our Medicaid
and CHIP beneficiaries and to our beneficiaries dually eligible for Medicare and Medicaid. We also contract with state
governmental entities and are subject to state laws and regulations relating to the award, administration and performance of
state government contracts.
State Privacy and Security Regulations. A number of states have adopted laws and regulations which may affect our privacy
and security practices, such as state laws governing the use, disclosure and protection of social security numbers and protected
health information or which are designed to implement GLBA or protect credit card account data. State and local authorities
increasingly focus on the importance of protecting individuals from identity theft, with a significant number of states enacting
laws requiring businesses to meet minimum cyber-security standards and notify individuals of security breaches involving
personal information. State consumer protection laws may also apply to privacy and security practices related to personally
identifiable information, including information related to consumers and care providers. Different approaches to state privacy
and insurance regulation and varying enforcement philosophies may materially and adversely affect our ability to standardize
our products and services across state lines. See Part I, Item 1A, “Risk Factors” for a discussion of the risks related to
compliance with state privacy and security regulations.
6
Corporate Practice of Medicine and Fee-Splitting Laws. Certain of our businesses function as direct medical service providers
and, as such, are subject to additional laws and regulations. Some states have corporate practice of medicine laws prohibiting
specific types of entities from practicing medicine or employing physicians to practice medicine. Moreover, some states
prohibit certain entities from engaging in fee-splitting practices, which involve sharing in the fees or revenues of a professional
practice. These prohibitions may be statutory or regulatory, or may be imposed through judicial or regulatory interpretation.
The laws, regulations and interpretations in certain states have been subject to limited judicial and regulatory interpretation and
are subject to change.
Pharmacy and Pharmacy Benefits Management (PBM) Regulations
Optum Rx’s businesses include home delivery, specialty and compounding pharmacies, as well as clinic-based pharmacies
which must be licensed as pharmacies in the states in which they are located. Certain of our pharmacies must also register with
the U.S. Drug Enforcement Administration (DEA) and individual state controlled substance authorities to dispense controlled
substances. In addition to adhering to the laws and regulations in the states where our pharmacies are located, we also are
required to comply with laws and regulations in some non-resident states where we deliver pharmaceuticals, including those
requiring us to register with the board of pharmacy in the non-resident state. These non-resident states generally expect our
pharmacies to follow the laws of the state in which the pharmacies are located, but some non-resident states also require us to
comply with their laws where pharmaceuticals are delivered. Additionally, certain of our pharmacies which participate in
programs for Medicare and state Medicaid providers are required to comply with applicable Medicare and Medicaid provider
rules and regulations. Other laws and regulations affecting our pharmacies include federal and state statutes and regulations
governing the labeling, packaging, advertising and adulteration of prescription drugs and dispensing of controlled substances.
See Part I, Item 1A, “Risk Factors” for a discussion of the risks related to our pharmacy care services businesses.
Federal and state legislation regulating PBM activities affects both our ability to limit access to a pharmacy provider network or
remove network providers. Additionally, many states limit our ability to manage and establish maximum allowable costs for
generic prescription drugs. With respect to formulary services, a number of government entities, including CMS, HHS and state
departments of insurance, regulate the administration of prescription drug benefits offered through federal or state exchanges.
Many states also regulate the scope of prescription drug coverage, as well as the delivery channels to receive such prescriptions,
for insurers, MCOs and Medicaid managed care plans. These regulations could limit or preclude (i) certain plan designs, (ii)
limited networks, (iii) use of particular care providers or distribution channels, (iv) copayment differentials among providers
and (v) formulary tiering practices.
Legislation seeking to regulate PBM activities introduced or enacted at the federal or state level could impact our business
practices with others in the pharmacy supply chain, including pharmaceutical manufacturers and network providers. In addition,
organizations like the NAIC periodically issue model regulations while credentialing organizations, like the National
Committee for Quality Assurance (NCQA) and the Utilization Review Accreditation Commission (URAC), may establish
standards impacting PBM pharmacy activities. Although these model regulations and standards do not have the force of law,
they may influence states to adopt their recommendations and impact the services we deliver to our clients.
Consumer Protection Laws
Certain of our businesses participate in direct-to-consumer activities and are subject to regulations applicable to online
communications and other general consumer protection laws and regulations such as the Federal Tort Claims Act, the Federal
Postal Service Act and the FTC’s Telemarketing Sales Rule. Most states also have similar consumer protection laws.
Certain laws, such as the Telephone Consumer Protection Act, give the FTC, the Federal Communications Commission (FCC)
and state attorneys general the ability to regulate, and bring enforcement actions relating to, telemarketing practices and certain
automated outbound contacts such as phone calls, texts or emails. Under certain circumstances, these laws may provide
consumers with a private right of action. Violations of these laws could result in substantial statutory penalties and other
sanctions.
Banking Regulation
Optum Bank is subject to regulation by federal banking regulators, including the Federal Deposit Insurance Corporation
(FDIC), which performs annual examinations to ensure the bank is operating in accordance with federal safety and soundness
requirements, and the Consumer Financial Protection Bureau, which may perform periodic examinations to ensure the bank is
in compliance with applicable consumer protection statutes, regulations and agency guidelines. Optum Bank is also subject to
supervision and regulation by the Utah State Department of Financial Institutions, which carries out annual examinations to
ensure the bank is operating in accordance with state safety and soundness requirements and performs periodic examinations of
the bank’s compliance with applicable state banking statutes, regulations and agency guidelines. In the event of unfavorable
examination results from any of these agencies, the bank could become subject to increased operational expenses and capital
requirements, enhanced governmental oversight and monetary penalties.
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Non-U.S. Regulation
Certain of our businesses operate internationally and are subject to regulation in the jurisdictions in which they are organized or
conduct business. These regulatory regimes vary from jurisdiction to jurisdiction. In addition, our non-U.S. businesses and
operations are subject to U.S. laws regulating the conduct and activities of U.S.-based businesses operating outside the United
States, such as the Foreign Corrupt Practices Act (FCPA), which prohibits offering, promising, providing or authorizing others
to give anything of value to a foreign government official to obtain or retain business or otherwise secure a business advantage.
COMPETITION
As a diversified health care company, we operate in highly competitive markets across the full expanse of health care benefits
and services. Our competitors include organizations ranging from startups to highly sophisticated Fortune 50 global enterprises,
for-profit and non-profit companies, and private and government-sponsored entities. New entrants to our markets and business
combinations among our competitors and suppliers also contribute to a dynamic and competitive environment. We compete
fundamentally on the quality and value we provide to those we serve which can include elements such as product and service
innovation; use of technology; consumer and provider engagement and satisfaction; and sales, marketing and pricing. See Part
I, Item 1A, “Risk Factors” for additional discussion of our risks related to competition.
INTELLECTUAL PROPERTY RIGHTS
We have obtained trademark registration for the UnitedHealth Group, Optum and UnitedHealthcare names and logos. We own
registrations for certain of our other trademarks in the United States and abroad. We hold a portfolio of patents and have patent
applications pending from time to time. We are not substantially dependent on any single patent or group of related patents.
Unless otherwise noted, trademarks appearing in this report are trademarks owned by us. We disclaim any proprietary interest
in the marks and names of others.
HUMAN CAPITAL RESOURCES
Our nearly 400,000 employees, as of December 31, 2024, including more than 140,000 clinical professionals, are guided by our
mission to help people live healthier lives and help make the health system work better for everyone. Our mission and cultural
values of integrity, compassion, inclusion, relationships, innovation, performance and quality align with our long-term business
strategy to increase access to care, make care more affordable, enhance the care experience, improve health outcomes and
advance health equity. Our mission and values attract individuals who are determined to make a difference – individuals whose
talent, innovation, engagement and empowerment are critical in our ability to achieve our mission.
We are committed to developing our people and culture by creating an inclusive environment where people of diverse talents,
backgrounds, experiences and perspectives make us better. Our approach is data-driven and leader-led and uses enterprise and
business scorecards to ensure our leaders are accountable for a consistent focus on hiring, developing, advancing and retaining
diverse talent. We have embedded inclusion and diversity throughout our culture, including in our talent acquisition and talent
management practices; leadership development; careers; learning and skills; and systems and processes. We strive to maintain a
skilled, sustainable and diverse talent pipeline by building strong strategic partnerships and outreach through early career
programs, internships and apprenticeships. We support career coaching, mentorship and accelerated leadership development
programs to ensure mobility and advancement for our diverse talent. To foster an engaged workforce and an inclusive culture,
we invest in a broad array of skills-based learning and culture development programs. We rely on a shared leadership
framework, which clearly and objectively defines our expectations, enables an environment where everyone has the opportunity
to learn and grow, and helps us identify, develop and deploy talent to help achieve our mission.
We prioritize pay equity by objectively and regularly evaluating and reviewing our compensation practices by performance,
age, experience, gender, ethnicity and race. Receiving on-going feedback from our team members is another way to strengthen
and reinforce a culture of inclusion. Our Employee Experience Index measures an employee’s sense of commitment and
belonging to our company and is a metric in the Stewardship section of our annual incentive plan. Our Sustainability Report,
which can be accessed on our website at www.unitedhealthgroup.com, provides further information about our people and
culture.
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INFORMATION ABOUT OUR EXECUTIVE OFFICERS
The following sets forth certain information regarding our executive officers as of February 27, 2025, including the business
experience of each executive officer during the past five years:
Name
Age
Position
Andrew Witty .............................................
60
Chief Executive Officer
John Rex .....................................................
63
President and Chief Financial Officer
Heather Cianfrocco.....................................
51
Chief Executive Officer, Optum
Erin McSweeney ........................................
60
Executive Vice President and Chief People Officer
Timothy Noel .............................................
53
Chief Executive Officer, UnitedHealthcare
Thomas Roos ..............................................
52
Senior Vice President and Chief Accounting Officer
Christopher Zaetta ......................................
53
Executive Vice President and Chief Legal Officer and Corporate Secretary
Our Board of Directors elects executive officers annually. Our executive officers serve until their successors are duly elected
and qualified, or until their earlier death, resignation, removal or disqualification.
Andrew Witty has served as Chief Executive Officer and a member of the Board of Directors of UnitedHealth Group since
February 2021. Previously, Andrew served as Chief Executive Officer of Optum from July 2018 to April 2021, President of
UnitedHealth Group from November 2019 to February 2021 and as a UnitedHealth Group director from August 2017 to March
2018. Prior to joining UnitedHealth Group, he was Chief Executive Officer and a board member of GlaxoSmithKline, a global
pharmaceutical company, from 2008 to 2017.
John Rex has served as President and Chief Financial Officer of UnitedHealth Group since April 2024. Previously, John served
as Chief Financial Officer of UnitedHealth Group since June 2016. From March 2012 to June 2016, he served as Executive
Vice President and Chief Financial Officer of Optum. Prior to joining Optum in 2012, John was a Managing Director at JP
Morgan, a global financial services firm.
Heather Cianfrocco has served as Chief Executive Officer of Optum since April 2024. Previously, Heather served as Optum's
President and held numerous leadership roles since joining UnitedHealth Group from 2008 until April 2024, including serving
as Chief Executive Officer of Optum Rx, Chief Executive Officer for Optum's Health Services and Chief Executive Officer of
UnitedHealthcare Community & State.
Erin McSweeney has served as Executive Vice President and Chief People Officer of UnitedHealth Group since March 2022.
From February 2021 to March 2022, Erin served as chief of staff to UnitedHealth Group’s Office of the Chief Executive. From
January 2017 to February 2021, she served as Executive Vice President and Chief Human Resources Officer at Optum. Prior to
joining UnitedHealth Group, Erin was Executive Vice President and Chief Human Resources Officer for EMC Corporation, an
international technology company.
Tim Noel has served as Chief Executive Officer of UnitedHealthcare since January 2025. Previously, Tim served as Chief
Executive Officer of UnitedHealthcare’s Medicare & Retirement business and held numerous leadership roles since joining
UnitedHealth Group from 2007 until January 2025, including serving as Chief Financial Officer and Senior Vice President of
federal products for Medicare & Retirement.
Tom Roos has served as Senior Vice President and Chief Accounting Officer of UnitedHealth Group since August 2015. Prior
to joining UnitedHealth Group, Tom was a Partner at Deloitte & Touche LLP, an independent registered public accounting
firm.
Chris Zaetta has served as Executive Vice President, Chief Legal Officer and Corporate Secretary of UnitedHealth Group since
May 2024. Previously, Chris served as Chief Legal Officer of Optum from September 2020 until May 2024. Prior to joining
Optum in 2020, Chris was Vice President at Johnson & Johnson, a pharmaceutical company. Chris also held several leadership
roles at UnitedHealth Group from May 2011 to September 2019, including Head of Litigation and General Counsel of the
organization’s government businesses.
ADDITIONAL INFORMATION
Our executive offices are located at 1 Health Drive, Eden Prairie, Minnesota 55344 and 655 New York Avenue, Washington,
DC 20001; our telephone number is (800) 328-5979. You can access our website at www.unitedhealthgroup.com to learn more
about our company. We make periodic and current reports and amendments available, free of charge, on our website, as soon as
reasonably practicable after we file or furnish these reports to the Securities and Exchange Commission (SEC). Information on
or linked to our website is neither part of nor incorporated by reference into this Annual Report on Form 10-K or any other SEC
filings.
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ITEM 1A.
RISK FACTORS
CAUTIONARY STATEMENTS
The statements, estimates, projections or outlook contained in this Annual Report on Form 10-K include forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). When used in this Annual
Report on Form 10-K and in future filings by us with the SEC, in our news releases, presentations to securities analysts or
investors, and in oral statements made by or with the approval of one of our executive officers, the words “believe,” “expect,”
“intend,” “estimate,” “anticipate,” “forecast,” “outlook,” “plan,” “project,” “should” or similar words or phrases are intended to
identify such forward-looking statements. These statements are intended to take advantage of the “safe harbor” provisions of
the PSLRA. These forward-looking statements involve risks and uncertainties which may cause our actual results to differ
materially from the expectations expressed or implied in the forward-looking statements. Any forward-looking statement in this
report speaks only as of the date of this report and, except as required by law, we undertake no obligation to update any
forward-looking statement to reflect events or circumstances, including unanticipated events, after the date of this report.
The following discussion contains cautionary statements regarding our business, which investors and others should consider.
We do not undertake to address in future filings with the SEC or other communications regarding our business or results of
operations how any of these factors may have caused our results to differ from discussions or information contained in our
previous filings or communications. In addition, any of the matters discussed below may have affected past, as well as current,
forward-looking statements about future results. Any or all forward-looking statements in this Annual Report on Form 10-K
and in any other SEC filings or public statements we make may turn out to be wrong. Our forward-looking statements can be
affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Many factors discussed
below will be important in determining our future results. By their nature, forward-looking statements are not guarantees of
future performance or results and are subject to risks, uncertainties and assumptions which are difficult to predict or quantify.
Risks Related to Our Business and Our Industry
If we fail to estimate, price for and manage our medical costs or design benefits in an effective manner, the profitability
of our risk-based products and services could decline and could materially and adversely affect our results of
operations, financial position and cash flows.
Through our risk-based benefit products, we assume the risk of both medical and administrative costs for our customers in
return for monthly premiums. The profitability of our products depends in large part on our ability to predict and effectively
price for and manage medical costs. Our Optum Health business also enters into fully accountable value-based arrangements
with payers. Premium revenues from risk-based products constitute nearly 80% of our total consolidated revenues. Estimates of
benefit expense payments involve extensive judgement and are subject to considerable inherent variability. Relatively small
differences between predicted and actual medical costs, or utilization rates as a percentage of revenues, have resulted and in the
future may result in significant changes in our financial results. If we fail to predict accurately, or effectively price for or
manage, the costs of providing care under risk-based arrangements, our results of operations could be materially and adversely
affected.
We manage medical costs through underwriting criteria, product design, negotiation of competitive provider contracts and care
management programs. Total medical costs are affected by the number of individual services rendered, the cost of each service
and the type of service rendered. Although we base the premiums we charge on our estimates of future medical costs over the
fixed contract period, many factors may cause, and have previously caused, actual costs to exceed those estimated and reflected
in premiums or bids. These factors may include medical cost inflation, increased use of services, business mix, unexpected
differences among new customer populations, increased cost of individual services, costs to deliver care, large-scale medical
emergencies, the potential effects of climate change, pandemics, the introduction of new or costly drugs or increases in drug
prices, treatments and technology, new treatment guidelines, newly mandated benefits or other regulatory changes and insured
population characteristics. Cost increases in excess of our forecasts typically cannot be recovered in the fixed premium period
through higher premiums. For Optum Health’s fully accountable value-based care, any inability to provide higher-quality
outcomes and better experiences at lower costs or to integrate our care delivery models could impact our results of operations,
financial positions and cash flows.
In addition, the financial results we report for any particular period include estimates of costs incurred for which claims are still
outstanding. These estimates involve an extensive degree of judgment. If these estimates prove inaccurate, our results of
operations could be materially and adversely affected.
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If we fail to maintain properly the integrity or availability of our data or successfully consolidate, integrate, upgrade or
expand our existing information systems, or if our technology products do not operate as intended, our business could
be materially and adversely affected.
Our business depends on the integrity and timeliness of the data we use to serve our members, customers and health care
professionals and to operate our business. If the data we rely upon to run our businesses is found to be inaccurate or unreliable
or if we fail to effectively maintain or protect the integrity of our data and information systems, including systems powered by
or incorporating artificial intelligence and machine learning (AI/ML), we could experience failures in our health, wellness and
information technology products; lose existing customers; have difficulty attracting new customers; experience problems in
determining medical cost estimates and establishing appropriate pricing; have difficulty preventing, detecting and controlling
fraud; have disputes with customers, physicians and other health care professionals; become subject to regulatory sanctions,
penalties, investigations or audits; incur increases in operating expenses; or suffer other adverse consequences.
The volume of health care data generated, and the uses of data, including electronic health records, are rapidly expanding. We
depend on the integrity of the data in our information systems to implement new and innovative services, automate and deploy
new technologies to simplify administrative processes and clinical decision making, price our products and services adequately,
provide effective service to our customers and consumers in an efficient and uninterrupted fashion, provide timely payments to
care providers, and accurately report our results of operations. In addition, increasing connectivity among technologies and
recent trends toward greater consumer engagement in health care require new and enhanced technologies, including more
sophisticated applications for mobile devices and new tools and products that leverage AI/ML to improve the customer
experience. We anticipate that fast-evolving AI/ML technologies, including generative AI, will play an increasingly important
role in our information systems and customer-facing technology products. Our ability to protect and enhance existing systems
and develop new systems to keep pace with changes in information processing technology (including AI/ML), regulatory
standards and changing customer preferences will require an ongoing commitment of significant development and operational
resources. If these commitments fail to provide the anticipated benefits, if we are unable to successfully anticipate future
technology developments, or if the cost to keep pace with the technological changes exceeds our estimates, we could be
exposed to reputational harm and experience adverse effects on our business.
We may not successfully implement our initiatives to consolidate the number of systems we operate, upgrade and expand our
information systems’ capabilities, integrate and enhance our systems and develop new systems to keep pace with recent
regulations and changes in information processing technology. Failure to protect, consolidate and integrate our systems
successfully could result in higher than expected costs.
Some of our businesses sell and install software products which may contain unexpected design defects or may encounter
unexpected complications during installation or when used with other technologies utilized by the customer. A failure of our
technology products to operate as intended and in a seamless fashion with other products could materially and adversely affect
our results of operations, financial position and cash flows.
Uncertain and rapidly evolving U.S. federal and state, non-U.S. and international laws and regulations related to health data and
health information technologies, including those powered by or incorporating AI/ML, may alter the competitive landscape or
impose new compliance requirements and could materially and adversely affect the configuration of our information systems
and platforms, and our ability to compete in our markets.
If we or third parties we rely on sustain cyberattacks or other privacy or data security incidents resulting in disruption
to our operations or the disclosure of protected personal information or proprietary or confidential information, we
could suffer a loss of revenue and increased costs, negative operational effects, exposure to significant liability,
reputational harm and other serious negative consequences.
We routinely process, store and transmit large amounts of data in our operations, including protected personal information
subject to privacy, security or data breach notification laws, as well as proprietary or confidential information relating to our
business or third parties. Some of the data we process, store and transmit may be outside of the United States due to our
information technology systems and international business operations. We are regularly the target of attempted cyberattacks
and other security threats and have previously been, and may in the future be, subject to compromises of the information
technology systems we use, information we hold, or information held on our behalf by third parties. For example, we
previously reported our Change Healthcare business, which we had recently acquired, was subject to a cyberattack in 2024, in
which the data involved contained protected health information or personally identifiable information.
While we have programs in place to detect, contain and respond to data security incidents and provide employee awareness
training regarding phishing, malware and other cyber threats to protect against cybersecurity risks and incidents, we expect that
we will continue to experience these incidents, some of which may negatively affect our business. Further, because the
techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and are
increasing in sophistication, in part due to use of evolving AI/ML technologies (including generative AI), and because our
businesses are changing as well, we may be unable to anticipate these techniques and threats, timely detect data security
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incidents or implement adequate preventive measures. Threat actors and hackers have previously been, and may in the future
be, able to negatively affect our operations by penetrating our security controls and causing system and operational disruptions
or shutdowns, accessing, misappropriating or otherwise compromising protected personal information or proprietary or
confidential information or that of third parties, and developing and deploying viruses, ransomware and other malware that can
attack our systems, exploit any security vulnerabilities, and disrupt or shutdown our systems and operations. In addition,
hardware, software, or applications we develop or procure from third parties may contain defects or other problems which could
unexpectedly compromise our information security controls. Our systems may also be vulnerable to financial fraud schemes,
misplaced or lost data, error, malicious social engineering, or other events which could negatively affect the data or financial
accounts, proprietary or confidential information relating to our business or third parties, or our operations. There have
previously been and may be in the future heightened vulnerabilities due to recently-acquired or non-integrated businesses. We
rely in some circumstances on third-party vendors to process, store and transmit large amounts of data for our business. The
operations of these vendors are subject to similar risks, but are outside our direct oversight and control.
The costs to eliminate or address the foregoing security threats and vulnerabilities before or after a cybersecurity incident could
be material. We have business continuation and resiliency plans which we maintain, update and test regularly in an effort to
contain and remediate potential disruptions or cybersecurity events. If our remediation efforts are not successful, we may
experience operational interruptions, delays, or cessation of service and loss of existing or potential customers. In addition,
compromises of our security measures or the unauthorized dissemination of sensitive personal information, proprietary
information or confidential information about us, our customers or other third parties, previously and in the future, could expose
us or them to the risk of financial or medical identity theft, negative operational impacts, and loss or misuse of this information,
result in litigation and liability, including regulatory penalties, for us, damage our brand and reputation, or otherwise harm our
business.
If we fail to develop and maintain satisfactory relationships with health care payers, physicians, hospitals and other
service providers, our business could be materially and adversely affected.
We depend substantially on our continued ability to contract with health care payers (as a service provider to those payers), as
well as physicians, hospitals, pharmaceutical benefit service providers, pharmaceutical manufacturers and other care and service
providers at competitive prices. If we fail to develop and maintain satisfactory relationships with health care providers, whether
in-network or out-of-network, our failure to do so could materially and adversely affect our business, results of operations,
financial position and cash flows. In addition, some of our activities related to network design, provider participation in
networks and provider payments could result in disputes, which may be costly and attract negative publicity.
In any particular market, physicians and health care providers could refuse to contract with us, demand higher payments, or take
other actions which could result in higher medical costs, less desirable products for customers or difficulty meeting regulatory
or accreditation requirements. In some markets, certain health care providers, particularly hospitals, physician and hospital
organizations or multi-specialty physician groups, may have significant market positions which could diminish our bargaining
power. In addition, Accountable Care Organizations (ACOs); physician group management services organizations (which
aggregate physician practices for administrative efficiency); and other organizational structures adopted by physicians, hospitals
and other care providers may change the way in which these providers do business with us and may change the competitive
landscape. Such organizations or groups of physicians may compete directly with us, which could adversely affect our business,
and our results of operations, financial position and cash flows by impacting our relationships with these providers or affecting
the way we price our products and estimate our costs, which might require us to incur costs to change our operations in an effort
to mitigate these impacts. In addition, if these providers refuse to contract with us, use their market position to negotiate
favorable contracts or place us at a competitive disadvantage, our ability to market products or to be profitable in those areas
could be materially and adversely affected.
Our health care benefits businesses have risk-based arrangements with some physicians, hospitals and other health care
providers. These arrangements limit our exposure to the risk of increasing medical costs, but expose us to risk related to the
adequacy of the financial and medical care resources of the health care providers. To the extent a risk-based health care
provider organization faces financial difficulties or otherwise is unable to perform its obligations under the arrangement, we
may be held responsible for unpaid health care claims which should have been the responsibility of the health care provider and
for which we have already paid the provider. Further, payment or other disputes between a primary care provider and specialists
with whom the primary care provider contracts could result in a disruption in the provision of services to our members or a
reduction in the services available to our members. Health care providers with which we contract may not properly manage the
costs of services, maintain financial solvency or avoid disputes with other providers. They may also fail to provide us with the
information we need to effectively conduct our businesses, such as information enabling us to estimate costs of care. Any of
these events could have a material adverse effect on the provision of services to our members and our operations.
Some providers that render services to our members do not have contracts with us. In some instances, those providers may
dispute the payment for these services and may institute litigation or arbitration relying on state and federal laws that define the
compensation that must be paid to out-of-network providers in some circumstances.
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The success of some of our businesses depends on maintaining satisfactory relationships with employed, affiliated, and
independently contracted physicians and joint venture partners. The physicians who practice medicine or contract with our
affiliated physician organizations could terminate their provider contracts or otherwise become unable or unwilling to continue
practicing medicine or contracting with us. We face and will likely continue to face heightened competition to acquire or
manage physician practices or to employ or contract with individual physicians. Our revenues could be materially and adversely
affected if we are unable to maintain or expand satisfactory relationships with physicians, to acquire, recruit or, in some
instances, employ physicians, or to retain enrollees following physician departures. In addition, our affiliated physician
organizations contract with competitors of UnitedHealthcare. Our businesses could suffer if our affiliated physician
organizations fail to maintain relationships with or fail to adequately price their contracts with these third-party payer
competitors.
Further, physicians, hospitals, pharmaceutical benefit service providers, pharmaceutical manufacturers and certain health care
providers are customers of our Optum businesses. Physicians also provide medical services at facilities owned by our Optum
businesses. Given the importance of health care providers and other constituents to our businesses, failure to maintain
satisfactory relationships with them could materially and adversely affect our results of operations, financial position and cash
flows.
If we fail to compete effectively to maintain or increase our market share, including maintaining or increasing
enrollments in businesses providing health benefits, our results of operations, financial position and cash flows could be
materially and adversely affected.
Our businesses face significant competition in all of the markets in which we operate. In many geographies or product
segments, our competitors have and may continue to have certain competitive advantages. Our competitive position may also be
adversely affected by significant merger and acquisition activity in the industries in which we operate, among both our
competitors and suppliers. Consolidation among competitors may make it more difficult for us to retain or increase our
customer base, maintain or improve the terms on which we do business with our suppliers, or maintain or increase our
profitability.
In addition, our success in the health care marketplace and future growth depends on our ability to develop and deliver
innovative and potentially disruptive products and services to satisfy evolving market demands. If we do not continue to
innovate and provide products and services which are useful and relevant to health care payers, consumers and our customers,
we may not remain competitive and risk losing market share to existing competitors and disruptive new market entrants. We
may face risks from new technologies and market entrants which could affect our existing relationship with health plan
enrollees in the affected markets. We could sustain competitive disadvantages and loss of market share if we fail to continue
developing innovative care models, including by accelerating the transition of care to value-based models that achieve higher
quality outcomes and better experiences at lower costs and expand access to virtual and in-home care. If health care payers or
providers are unwilling or unable to enter into value-based agreements with us, we may be unable to successfully establish or
maintain the contractual or employment relationships necessary to achieve the quality and cost objectives we have for value-
based contracting. Additionally, our competitive position could be adversely affected by any failure to develop and apply
innovative technologies and other effective data and analytics capabilities or to provide services to our clients focused on these
technologies and capabilities.
Our business, results of operations, financial position and cash flows also could be materially and adversely affected if we do
not compete effectively in our markets, if our reputation suffers harm, if we set rates too high or too low in highly competitive
markets, if we do not design and price our products properly and competitively, if we are unable to innovate and deliver
products and services demonstrating value to our customers, if we do not provide a satisfactory level of services, if membership
or demand for other services does not increase as we expect or declines, or if we lose accounts with more profitable products
while retaining or increasing membership in accounts with less profitable products.
We are routinely subject to various private party and governmental legal actions and investigations, which could
damage our reputation and, if resolved unfavorably, could result in substantial penalties or monetary damages and
materially and adversely affect our results of operations, financial position and cash flows.
We are routinely made party to a variety of private party and governmental legal actions and investigations related to, among
other matters, the design, management and delivery of our product and service offerings. Any failure by us to adhere to the laws
and regulations applicable to our businesses could subject us to civil and criminal penalties.
Legal actions to which we are a party have included and in the future could include matters related to health care benefits
coverage and payment of claims (including disputes with enrollees, customers and contracted and non-contracted physicians,
hospitals and other health care professionals), tort claims (including claims related to the delivery of health care services, such
as medical malpractice by personnel at our affiliates’ facilities, or by health care practitioners who are employed by us, have
contractual relationships with us, or serve as providers to our managed care networks, including as a result of a failure to adhere
to applicable clinical, quality and/or patient safety standards), antitrust claims (including as a result of changes in the
13
enforcement of antitrust laws), whistleblower claims (including claims under the False Claims Act or similar statutes), matters
related to our use of or alleged failure to adequately safeguard personal information or other proprietary data, claims related to
alleged failure of our technology products to operate properly or fairly, contract and labor disputes, tax claims and claims
related to disclosure of certain business practices. In addition, some of our pharmacy services operations are subject to clinical
quality, patient safety and other risks inherent in the dispensing, packaging and distribution of drugs, including claims related to
purported dispensing and other operational errors. We may also be party to certain class action lawsuits brought by health care
professional groups and consumers. We operate in jurisdictions outside of the United States where contractual rights, tax
positions and applicable regulations may be subject to interpretation or uncertainty to a greater degree than in the United States,
and therefore subject to dispute by customers, government authorities or others.
We are largely self-insured with regard to litigation risks, including claims of medical malpractice against our affiliated
physicians and us. Although we record liabilities for our estimates of the probable costs resulting from self-insured matters, it is
possible the level of actual losses will significantly exceed the liabilities recorded. Additionally, physicians and other healthcare
providers have become subject to an increasing number of legal actions alleging medical malpractice and general professional
liabilities. Even in states that have imposed caps on damages for such actions, litigants are seeking recoveries under theories of
liability that might not be subject to the caps on damages. These actions involve significant defense costs and could result in
substantial monetary damages or damage to our reputation.
We cannot predict the outcome of significant legal actions in which we are involved. Even in situations where we engage
external insurers, our coverage may be disputed or may not be sufficient to cover the entirety of certain claims. We incur
expenses to resolve these matters and current and future legal actions could further increase our cost of doing business, require
us to potentially change the way we conduct our business, and materially and adversely affect our results of operations,
financial position and cash flows. Moreover, certain legal actions could result in adverse publicity which could damage our
reputation and materially and adversely affect our ability to retain our current business or grow our market share in some
markets and businesses.
Our business could suffer, and our results of operations, financial position and cash flows could be materially and
adversely affected, if we fail to successfully manage our strategic alliances, or to complete, manage or integrate
acquisitions and other significant strategic transactions or relationships.
As part of our business strategy, we frequently engage in discussions with third parties regarding possible investments,
acquisitions, divestitures, strategic alliances, joint ventures and outsourcing transactions and often enter into agreements relating
to such transactions. If we fail to meet the needs of our alliance or joint venture partners, including by developing additional
products and services, providing high levels of service, pricing our products and services competitively or responding
effectively to applicable federal and state regulatory changes, our alliances and joint ventures could be damaged or terminated,
which in turn could adversely impact our reputation, business and results of operations. Further, governmental actions, such as
actions by the FTC or DOJ, may affect our ability to complete strategic transactions, which could adversely affect our future
growth. If we fail to identify and successfully complete transactions to meet our strategic objectives, including as a result of
antitrust regulatory enforcement actions, such as those that have been brought against us in the past, we may be required to
expend resources to develop products and technology internally, be placed at a competitive disadvantage or be adversely
affected by negative market perceptions, any of which may have a material adverse effect on our results of operations, financial
position or cash flows.
Successful acquisitions also require us to effectively integrate the acquired business into our existing operations, including our
internal control environment and culture, or otherwise leveraging its operations which may present risks different from those
presented by organic growth and may be difficult for us to manage. For example, we have experienced and in the future may
encounter more acute information technology system vulnerabilities or different litigation risk profiles in recently acquired
business than we have historically managed. We may be unable to address such vulnerabilities, inadequacies, differences, or
failures soon after acquiring a business, which could undermine integration activities, delay launch of acquired products, and
increase infrastructure risk. In addition, even with appropriate diligence, pre-acquisition practices of an acquired business have
exposed us in the past and may expose us in the future to legal challenges and investigations that could subject us to criminal
fines or reputational harm. Even if we are ultimately successful in resolving these matters, defending such claims may be costly
and result in negative publicity. If we cannot successfully integrate our acquired businesses and realize contemplated revenue
growth opportunities, cost savings and other synergies, our business, prospects, results of operations, financial position and cash
flows could be materially and adversely affected.
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We are subject to risks associated with public health crises arising from large-scale medical emergencies, pandemics,
natural disasters and other extreme events, which have had and could have an adverse effect on our business, results of
operations, financial condition and financial performance.
Large-scale medical emergencies, pandemics, natural disasters, public health crises and other extreme events could have a
material adverse effect on our business operations, cash flows, financial conditions and results of operations. For example,
disruptions in public and private infrastructure resulting from such events could increase our operating costs and impair our
ability to provide services to our clients and customers. In addition, as a result of these events, the premiums and fees we charge
may not be sufficient to cover our medical and administrative costs, deferred medical care could be sought in future periods at
potentially higher acuity levels, we could experience reduced demand for our services, and our clinical and non-clinical
workforce could be affected and sustain a reduced capacity to handle demand for care. Public health crises arising from natural
disasters, such as wildfires, hurricanes, and snowstorms, or effects of climate change could impact our business operations and
result in increased medical care costs. Government enactment of emergency powers in response to public health crises could
disrupt our business operations, including by restricting availability of, or our ability to deliver, pharmaceuticals or other
supplies, and could increase the risk of shortages of necessary items.
Our sales performance will suffer if we do not adequately attract, retain and provide support to a network of
independent producers and consultants.
Our products and services are sold in part through nonexclusive producers and consultants for whose services and allegiance we
must compete. Our sales could be materially and adversely affected if we are unable to attract, retain and support independent
producers and consultants or if our sales strategy is not appropriately aligned across distribution channels. Our relationships
with producers could be impaired by changes in our business practices and the terms of our relationships, including commission
levels.
Our businesses are subject to risks associated with unfavorable economic conditions.
Unfavorable economic conditions may have a range of impacts on the demand for our products and services. Such conditions
also have caused and in future periods could continue to cause employers to stop offering certain health care coverage as an
employee benefit or elect to offer particular coverage on a voluntary, employee-funded basis to reduce their operating costs. In
addition, unfavorable economic conditions could adversely impact our ability to increase premiums or result in the cancellation
by certain customers of our products and services. These conditions could lead to a decrease in people served and in the
premium and fee revenues we generate.
A prolonged unfavorable economic environment could constrain state and federal budgets and result in reduced reimbursements
or payments in our federal and state government health care coverage programs, including Medicare, Medicaid and CHIP. A
reduction in state Medicaid reimbursement rates could be implemented retroactively to apply to payments already negotiated or
received from the government. In addition, state and federal budgetary pressures could cause the affected governments to
impose new or a higher level of taxes or assessments for our commercial programs, such as premium taxes on health insurance
and surcharges or fees on select fee-for-service and capitated medical claims. Any of these developments or actions could
materially and adversely affect our results of operations, financial position and cash flows.
A prolonged unfavorable economic environment could also adversely impact the financial position of hospitals and other care
providers which could negatively affect our contracted rates with these parties and increase our medical costs or materially and
adversely affect their ability to purchase our service offerings. Further, unfavorable economic conditions could have a material
adverse effect on our financial results by impacting the customers of our Optum businesses, including health plans, hospitals,
care providers, employers and others.
Our failure to attract, develop, retain, and manage the succession of key employees and executives could adversely affect
our business, results of operations and future performance.
We depend on our ability to attract, develop and retain qualified employees and executives, including those with diverse talents,
backgrounds, experiences and perspectives, to operate and expand our business. While we have development and succession
plans in place for our key employees and executives, these plans do not guarantee that the services of our key employees and
executives will continue to be available to us. If we are unable to attract, develop, retain and effectively manage the
development and succession plans for key employees and executives, our business, results of operations and future performance
could be adversely affected. Experienced and highly skilled employees and executives in the health care and technology
industries are in high demand and the market for their services is competitive. We may have difficulty in replacing key
executives because of the limited number of qualified individuals in these industries with the breadth of skills and experience
required to operate and successfully expand our business. Adverse changes to our corporate culture could harm our business
operations and our ability to retain key employees and executives.
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Our investment portfolio may sustain losses which could adversely affect our profitability.
Market fluctuations could impair the value of our investment portfolio and our profitability. Volatility in interest rates affects
our interest income and the market value of our investments in debt securities of varying maturities which constitute the
substantial majority of the fair value of our investments as of December 31, 2024. In addition, a delay in payment of principal
or interest by issuers, or defaults by issuers (primarily issuers of our investments in corporate and municipal bonds), could
reduce our investment income and require us to write down the value of our investments which could adversely affect our
profitability and equity.
Our investments may not produce total positive returns and we may sell investments at prices which are less than their carrying
values. Changes in the value of our investment assets, as a result of interest rate fluctuations, changes in issuer financial or
market conditions, illiquidity or otherwise, could have an adverse effect on our equity. In addition, if it should become
necessary for us to liquidate a material portion of our investment portfolio on an accelerated basis, such an action could have an
adverse effect on our results of operations and the capital position of our regulated subsidiaries.
If the value of our intangible assets is materially impaired, our results of operations, equity and credit ratings could be
materially and adversely affected.
As of December 31, 2024, our goodwill and other intangible assets had a carrying value of $130 billion, representing 44% of
our total consolidated assets. We periodically evaluate our goodwill and other intangible assets to determine whether all or a
portion of their carrying values may be impaired, in which case a charge to earnings may be necessary. The value of our
goodwill may be materially and adversely impacted if businesses we acquire perform in a manner inconsistent with our
assumptions. In addition, from time to time we divest businesses, and any such divestiture could result in significant asset
impairment and disposition charges, including those related to goodwill and other intangible assets. Any future evaluations
requiring an impairment of our goodwill and other intangible assets could materially and adversely affect our results of
operations and equity in the period in which the impairment occurs. A material decrease in equity could, in turn, adversely
affect our credit ratings.
If we are not able to protect our proprietary rights to our databases, software and related products, or other intellectual
property, our ability to market our knowledge and information-related businesses could suffer.
We rely on our agreements with customers, confidentiality agreements with employees and third parties, and our trademarks,
trade secrets, copyrights and patents to protect our proprietary rights. These legal protections and precautions may not prevent
misappropriation of our proprietary information. In addition, intellectual property rights inherent in software are the subject of
substantial litigation, and we expect our software products to be increasingly subject to third-party infringement claims as the
number of products and competitors in the health care-focused software industry segment grows. Such litigation and
misappropriation of our proprietary information could hinder our ability to market and sell products and services which could
materially and adversely affect our results of operations, financial position and cash flows.
Any downgrades in our credit ratings could increase our borrowing and operating costs.
Claims paying ability, financial strength and debt ratings by nationally recognized statistical rating organizations are important
factors in establishing the competitive position of insurance companies. Ratings information is broadly disseminated and
generally used by customers and creditors. We believe our claims paying ability and financial strength ratings are important
factors in marketing our products to certain of our customers. Our credit ratings impact both the cost and availability of future
borrowings. Each of the credit rating agencies reviews its ratings periodically. Our ratings reflect each credit rating agency’s
opinion of our financial strength, operating performance and ability to meet our debt obligations or obligations to policyholders.
We may not be able to maintain our current credit ratings in the future. Any downgrades in our credit ratings could materially
increase our costs of or ability to access funds in the debt capital markets and otherwise materially increase our operating costs.
Risks Related to the Regulation of Our Business
Our business activities in the United States and other countries are highly regulated and new laws or regulations or
changes in existing laws or regulations or their enforcement or application could materially and adversely affect our
business.
We are regulated by federal, state and local governments in the United States and other countries where we do business. Our
insurance and HMO subsidiaries must be licensed by and are subject to regulation in the jurisdictions in which they conduct
business. For example, states require periodic financial reports and enforce minimum capital or restricted cash reserve
requirements. Health plans and insurance companies are also regulated under state insurance holding company regulations and
some of our activities may be subject to other health care-related regulations and requirements, including regulations and
licensure requirements related to PPOs, MCOs, UR and TPAs. Under state guaranty association laws, certain insurance
companies can be assessed (up to prescribed limits) for certain obligations to the policyholders and claimants of impaired or
insolvent insurance companies which write the same line or similar lines of business. Any such assessment could expose our
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insurance entities and other insurers to the risk they would be required to pay a portion of an impaired or insolvent insurance
company’s claims through state guaranty associations.
Some of our businesses provide products or services to government agencies. For example, some of our Optum and
UnitedHealthcare businesses hold government contracts or provide services related to government contracts and are subject to
U.S. federal and state and non-U.S. self-referral, anti-kickback, medical necessity, risk adjustment, false claims and other laws
and regulations governing government contractors and the use of government funds. Our relationships with these government
agencies are subject to the terms of our contracts with the agencies and to laws and regulations regarding government contracts.
Among others, certain laws and regulations restrict or prohibit companies from performing work for government agencies
which might be viewed to involve an actual or potential conflict of interest. These laws and regulations may limit our ability to
pursue and perform certain types of engagements, thereby materially and adversely affecting our results of operations, financial
position and cash flows.
Some of our Optum businesses are also subject to regulations distinct from those faced by our insurance and HMO subsidiaries,
some of which could impact our relationships with physicians, hospitals and customers. These regulations include state
telemedicine regulations; debt collection laws; banking regulations; distributor and producer licensing requirements; state
corporate practice of medicine restrictions; fee-splitting rules; and health care facility licensure and certificate of need
requirements. These risks and uncertainties may materially and adversely affect our ability to market or provide our products
and services, or to achieve targeted operating margins, or may increase the regulatory burdens under which we operate.
The laws and rules governing our businesses and interpretations of those laws and rules are subject to frequent and often
unpredictable change. For example, legislative, administrative and public policy changes to the ACA have been and likely will
continue to be considered, and we cannot predict if the ACA will be further modified. Additionally, changes in tax laws or
unfavorable resolutions of exams could create additional tax liabilities.
The integration of entities we acquire into our businesses may affect the way in which existing laws and rules apply to us,
including by subjecting us to laws and rules which did not previously apply to us. The broad latitude given to the agencies
administering, interpreting and enforcing current and future regulations governing our businesses could compel us to change
how we do business, renegotiate existing contracts and other arrangements, restrict revenue and enrollment growth, increase our
health care and administrative costs and capital requirements, or expose us to increased liability in courts for coverage
determinations, resolution of commercial disputes and other actions.
We also must obtain and maintain regulatory approvals to market many of our products and services, increase prices for some
regulated products and services and complete or integrate strategic transactions. For example, premium rates for our health
insurance and managed care products are subject to regulatory review or approval in many states and by the federal
government. Additionally, we must submit data on proposed rate increases to HHS on many of our products for monitoring
purposes. Geographic and product expansions of our businesses may be subject to state and federal regulatory approvals.
Delays in obtaining necessary approvals or our failure to obtain or maintain adequate approvals could materially and adversely
affect our results of operations, financial position and cash flows.
We also currently operate outside of the United States and in the future may acquire or commence additional businesses based
outside of the United States, increasing our exposure to non-U.S. regulatory regimes. Our failure to comply with U.S. or non-
U.S. laws and regulations governing our conduct outside the United States or to establish constructive relationships with non-
U.S. regulators could adversely affect our ability to market our products and services or to do so at targeted operating margins,
which may have a material adverse effect on our business, financial condition and results of operations. Non-U.S. regulatory
regimes, which vary by jurisdiction, encompass, among other matters, local and cross-border taxation, licensing, tariffs,
intellectual property, investment, capital (including minimum solvency margin and reserve requirements), management control,
labor, anti-fraud, anti-corruption and privacy and data protection regulations (including requirements for cross-border data
transfers). Any foreign regulator or court may take an approach to the interpretation, implementation and enforcement of
industry regulations which could differ from the approach taken by U.S. regulators or courts. In addition, our non-U.S.
businesses and operations are subject to U.S. laws regulating the conduct and activities of U.S.-based businesses operating
outside the United States, such as the FCPA, which prohibits offering, promising, providing or authorizing others to give
anything of value to a foreign government official to obtain or retain business or otherwise secure a business advantage.
The health care industry is regularly subject to negative publicity, including as a result of governmental investigations, adverse
media coverage and political debate concerning industry regulation. Negative publicity may adversely affect our stock price,
damage our reputation, and expose us to unexpected or unwarranted regulatory scrutiny.
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As a result of our participation in various government health care programs, both as a payer and as a service provider
to payers, we are exposed to additional risks associated with program funding, enrollments, payment adjustments,
audits and government investigations which could materially and adversely affect our business, results of operations,
financial position and cash flows.
We participate in various federal, state and local government health care benefit programs, including as a payer in Medicare
Advantage, Medicare Part D, various Medicaid programs and CHIP, and receive substantial revenues from these programs.
Some of our Optum businesses also provide services to payers participating in government health care programs. A reduction or
less than expected increase, or a protracted delay, in government funding for these programs or change in allocation
methodologies, or termination of the contract at the option of the government, has affected and in future periods may materially
and adversely affect our results of operations, financial position and cash flows.
The government health care programs in which we participate are generally subject to frequent changes, including changes
which may reduce the number of persons enrolled or eligible for coverage (such as Medicaid eligibility redeterminations in
certain states), reduce the amount of reimbursement or payment levels, reduce our participation in, or prevent our expansion
into, certain service areas or markets, or increase our administrative or medical costs under such programs. Revenues for these
programs depend on periodic funding from the federal government or applicable state governments and allocation of the
funding through various payment mechanisms. Funding for these government programs depends on many factors outside of our
control, including general economic conditions and budgetary constraints at the federal or applicable state level. For example,
CMS in the past has reduced or frozen Medicare Advantage benchmarks and additional cuts to Medicare Advantage
benchmarks are possible. In addition, from time to time, CMS makes changes to the way it calculates Medicare Advantage risk
adjustment payments. Although we have adjusted members’ benefits and premiums on a selective basis, ceased to offer benefit
plans in certain counties, and intensified both our medical and operating cost management in response to the benchmark
reductions and other funding pressures, these or other strategies may not fully address the funding pressures in the Medicare
Advantage program. In addition, payers in the Medicare Advantage program may be subject to reductions in payments from
CMS as a result of decreased funding or recoupment pursuant to government audit. States have also made changes in rates and
reimbursements for Medicaid members and audits can result in unexpected recoupments.
Under the Medicaid managed care program, state Medicaid agencies solicit bids from eligible health plans to continue their
participation in the acute care Medicaid health programs. If we are not successful in obtaining renewals of state Medicaid
managed care contracts, we risk losing the members who were enrolled in those Medicaid programs. Under the Medicare Part
D program, to qualify for automatic enrollment of low income members, our bids must result in an enrollee premium below a
regional benchmark, which is calculated by the government after all regional bids are submitted. If the enrollee premium is not
below the government benchmark, we risk losing the members who were auto-assigned to us and will not have additional
members auto-assigned to us. Chronic failure to meet the benchmarks could result in termination of these government contracts.
In general, our bids are based upon certain assumptions regarding enrollment, utilization, medical costs and other factors. If any
of these assumptions are materially incorrect, either as a result of unforeseen changes to the programs on which we bid,
implementation of material program or policy changes after our bid submission, or submissions by our competitors at lower
rates than our bids, our results of operations, financial position and cash flows could be materially and adversely affected.
Many of the government health care coverage programs we participate in are subject to the prior satisfaction of certain
conditions or performance standards or benchmarks. For example, as part of the ACA, CMS has a system providing various
quality bonus payments to Medicare Advantage plans meeting specified quality star ratings at the individual plan or local
contract level. The star rating system considers various measures adopted by CMS, including, among others, quality of care,
preventive services, chronic illness management, handling of appeals and customer satisfaction. Plans must have a rating of
four stars or higher to qualify for bonus payments, and CMS has and may make changes to the star rating program that impact
the ability of plans to achieve four-star or higher ratings. If we do not maintain or continue to improve our star ratings, our plans
may not be eligible for quality bonuses and we may experience a negative impact on our revenues and the benefits our plans
can offer, which could materially and adversely affect the marketability of our plans and the number of people we serve. Any
changes in standards or care delivery models applying to government health care programs, including Medicare and Medicaid,
or our inability to maintain or improve our quality scores and star ratings to meet evolving government performance
requirements or to match the performance of our competitors could result in limitations to our participation in or exclusion from
these or other government programs, which could materially and adversely affect our results of operations, financial position
and cash flows.
CMS uses various payment mechanisms to allocate funding and adjust monthly capitation payments for Medicare programs.
For Medicare Advantage plans, these adjustments are made according to the predicted health status of each beneficiary as
supported by data from health care providers. For Medicare Part D plans, payment adjustments are driven by risk-sharing
provisions based on a comparison of costs forecasted in our annual bids to actual prescription drug costs. Some state Medicaid
programs utilize a similar process. For example, our UnitedHealthcare Medicare & Retirement and UnitedHealthcare
Community & State businesses submit information relating to the health status of enrollees to CMS or state agencies for
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purposes of determining the amount of certain payments to us. CMS and the Office of Inspector General for HHS periodically
perform risk adjustment data validation (RADV) audits of selected Medicare health plans to validate the coding practices of and
supporting documentation maintained by health care providers. Some of our local plans have been selected for such audits,
which in the past have resulted and in future periods could result in retrospective adjustments to payments made to our health
plans, fines, corrective action plans or other adverse action by CMS.
We have been and in the future may become involved in routine, regular and special governmental investigations, audits,
reviews and assessments. Such investigations, audits, reviews or assessments sometimes arise out of, or prompt claims by
private litigants or whistleblowers regarding, among other allegations, claims that we failed to disclose certain business
practices or, as a government contractor, submitted false or erroneous claims to the government. Government investigations,
audits, reviews and assessments could lead to government actions, which have resulted and in future periods could result in
adverse publicity, the assessment of damages, civil or criminal fines or penalties, or other sanctions, including restrictions or
changes in the way we conduct business, loss of licensure or exclusion from participation in government programs, any of
which could have a material adverse effect on our business, results of operations, financial position and cash flows.
Our pharmacy care services businesses face regulatory and operational risks and uncertainties which may differ from
the risks of our other businesses.
We provide pharmacy care services through our Optum Rx and UnitedHealthcare businesses. Each business is subject to federal
and state anti-kickback, beneficiary inducement and other laws governing the relationships of the business with pharmaceutical
manufacturers, physicians, pharmacies, customers and consumers. In addition, federal and state legislatures regularly consider
new regulations for the industry which could materially affect current industry practices, including potential new legislation and
regulations regarding the receipt or disclosure of rebates and other fees from pharmaceutical companies, the development and
use of formularies and other utilization management tools, the use of average wholesale prices or other pricing benchmarks,
pricing for specialty pharmaceuticals, limited access to networks and pharmacy network reimbursement methodologies.
Further, various governmental agencies have conducted and continue to conduct investigations and studies into certain PBM
practices, which have resulted and in future periods may result in PBMs agreeing to civil penalties, including the payment of
money and entry into corporate integrity agreements, or could materially and adversely impact the PBM business model. As a
provider of pharmacy benefit management services, Optum Rx is also subject to an increasing number of licensure, registration
and other laws and accreditation standards. Optum Rx conducts business through home delivery, specialty and compounding
pharmacies, pharmacies located in community mental health centers and home infusion, which subjects it to extensive federal,
state and local laws and regulations, including those of the DEA and individual state controlled substance authorities, the Food
and Drug Administration and Boards of Pharmacy.
We could face potential claims in connection with purported errors by our home delivery, specialty or compounding or clinic-
based pharmacies or the provision of home infusion services, as well as claims related to the inherent risks in the packaging and
distribution of pharmaceuticals and other health care products. Disruptions from any of our home delivery, specialty pharmacy
or home infusion services could materially and adversely affect our results of operations, financial position and cash flows.
In addition, our pharmacy care services businesses provide services to sponsors of health benefit plans subject to ERISA. A
private party or the DOL, which is the agency that enforces ERISA, could assert that fiduciary obligations imposed by the
statute apply to some or all of the services provided by our pharmacy care services businesses even where those businesses are
not contractually obligated to assume fiduciary obligations. If a court were to determine such fiduciary obligations apply, we
could be subject to claims for breaches of fiduciary obligations or claims we entered into prohibited transactions.
If we fail to comply with applicable privacy, security, technology and data laws, regulations and standards, including
with respect to third-party service providers utilizing protected personal information on our behalf, our business,
reputation, results of operations, financial position and cash flows could be materially and adversely affected.
The collection, maintenance, protection, use, transmission, disclosure and disposal of protected personal information are
regulated at the federal, state, international and industry levels and addressed in requirements of our customer contracts.
Additionally, legislative and regulatory action in the United States at the federal, state and local levels, as well as
internationally, is emerging in the areas of AI/ML and automation. These laws, regulations and requirements are subject to
change. Compliance with new privacy, security, technology and data laws, regulations and requirements may result in increased
operating costs, and may constrain or require us to alter our business model or operations.
Internationally, many of the jurisdictions in which we operate have established their own data security and privacy legal
framework with which we or our customers must comply. We expect there will continue to be new proposed laws, regulations
and industry standards concerning privacy, data protection, information security, and AI/ML and automation in the European
Union, UK, Chile, India and other jurisdictions, and we cannot yet determine the impacts such future laws, regulations and
standards may have on our businesses or the businesses of our customers.
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Some of our businesses are also subject to the Payment Card Industry Data Security Standard, which is a multifaceted security
standard designed to protect payment card account data.
HIPAA requires business associates as well as covered entities to comply with specified privacy and security requirements.
While we provide for appropriate protections through our contracts with our third-party service providers and in certain cases
assess their security controls, we have limited oversight or control over their actions and practices. Several of our businesses act
as business associates to their covered entity customers and, as a result, collect, use, disclose and maintain protected personal
information in order to provide services to these customers. If HHS alleges or finds noncompliance with HIPAA privacy or
security requirements, the allegations or findings could damage our reputation and subject us to monetary and other sanctions.
Through our Optum businesses, we maintain a database of administrative and clinical data statistically de-identified in
accordance with HIPAA standards. Noncompliance or findings of noncompliance with applicable laws, regulations or
requirements, or the occurrence of any privacy or security breach involving the misappropriation, loss or other unauthorized
disclosure of protected personal information, whether by us or by one of our third-party service providers, could have an
adverse effect on our reputation and business and, among other consequences, could subject us to mandatory disclosure to
affected customers and the media, loss of existing or new customers, significant increases in the cost of managing and
remediating privacy or security incidents, and could also result in significant fines, penalties and litigation awards. Any of these
consequences could have a material and adverse effect on our results of operations, financial position and cash flows.
As an enterprise, we increasingly rely on new and evolving technologies, including those powered by or incorporating AI/ML,
as part of our internal operations and in the delivery of our products and services. New technologies have potential and power
to improve and optimize operational processes and clinical outcomes across the healthcare system, but also present ethical,
technological, legal, regulatory and other risks. With respect to AI/ML, we have developed and implemented policies and
procedures intended to promote and sustain responsible design, development, and use of AI/ML, consistent with industry best
practices. Any inadequacy or failure in compliance with our responsible use of AI/ML policies and procedures or emerging
laws, regulations and standards governing AI/ML use could cause our technology products not to operate as intended or to
produce outcomes, including possible regulatory enforcement action or litigation that could have a material and adverse effect
on our business, reputation, results of operations, financial position and cash flows.
Restrictions on our ability to obtain funds from our regulated subsidiaries could materially and adversely affect our
ability to reinvest in our business, service our debt and return capital to our shareholders.
Because we operate as a holding company, we are dependent on dividends and administrative expense reimbursements from
our subsidiaries to fund our obligations. Many of these subsidiaries are regulated by state departments of insurance or similar
regulatory authorities. We are also required by law or regulation to maintain specific prescribed minimum amounts of capital in
these subsidiaries. The levels of capitalization required depend primarily on the volume of premium revenues generated by the
applicable subsidiary. In most states, we are required to seek approval by state regulatory authorities before we transfer money
or pay dividends from our regulated subsidiaries exceeding specified amounts. An inability of our regulated subsidiaries to pay
dividends to their parent companies in the desired amounts or at the time of our choosing could adversely affect our ability to
reinvest in our business through capital expenditures or business acquisitions, as well as our ability to maintain our corporate
quarterly dividend payment, repurchase shares of our common stock and repay our debt. If we are unable to obtain sufficient
funds from our subsidiaries to fund our obligations, our results of operations, financial position and cash flows could be
materially and adversely affected.
ITEM 1B.
UNRESOLVED STAFF COMMENTS
None.
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ITEM 1C.
CYBERSECURITY
UnitedHealth Group manages cybersecurity and data protection through a continuously evolving framework. The framework
allows us to identify, assess and mitigate the risks we face, and assists us in establishing policies and safeguards to protect our
systems and the information of those we serve.
Our cybersecurity program is managed by our Chief Digital and Technology Officer and our Chief Security Officer. The Audit
and Finance Committee of the Board of Directors has oversight of our cybersecurity program and is responsible for reviewing
and assessing the effectiveness of the Company’s cybersecurity and data protection policies, procedures and resource
commitment, including key risk areas and mitigation strategies. As part of this process, the Audit and Finance Committee
receives regular updates from the Chief Digital and Technology Officer and the Chief Security Officer on critical issues related
to our information security risks, cybersecurity strategy, supplier risk and business continuity capabilities. The Audit and
Finance Committee has also added a leading cybersecurity incident and response firm to serve as its advisor on cybersecurity
matters.
The Company’s framework includes an incident management and response program that continuously monitors the Company’s
information systems for vulnerabilities, threats and incidents; manages and takes action to contain incidents that occur;
remediates vulnerabilities; and communicates the details of significant threats and incidents to management, including the Chief
Digital and Technology Officer and the Chief Security Officer, as deemed necessary or appropriate. Pursuant to the Company’s
incident response plan, incidents are reported to the Audit and Finance Committee and appropriate government agencies and
other authorities, as deemed necessary or appropriate, considering the actual or potential impact, significance and scope.
We require our third-party partners and contractors to handle data in accordance with our data privacy and information security
requirements and applicable laws. We regularly engage with our suppliers, partners, contractors, service providers and internal
development teams to identify and remediate vulnerabilities in a timely manner and monitor system upgrades to mitigate future
risk, and evaluate whether they employ appropriate and effective controls and continuity plans for their systems and operations.
To ensure that our program is designed and operating effectively, our infrastructure and information systems are audited
periodically by internal and external auditors. We have obtained various certifications from industry-recognized certifying
organizations as a result of certain external audits. We also perform regular vulnerability assessments and penetration tests to
improve system security and address emerging security threats. Our internal audit team independently assesses security controls
against our enterprise policies to evaluate compliance and leverages a combination of auditing and security frameworks to
evaluate how leading practices are applied throughout our enterprise. Audit results and remediation progress are reported to and
monitored by senior management and the Audit and Finance Committee. We also periodically partner with industry-leading
cybersecurity firms to assess our cybersecurity program. These assessments complement our other assessment work by
evaluating our cybersecurity program as a whole.
We complete an enterprise information risk assessment as part of our overall enterprise information security risk management
assessment, which is overseen by our Chief Security Officer. This risk assessment is a review of internal and external threats
that evaluates changes to the information risk landscape to inform the investments and program enhancements to be made in the
future to rapidly respond and recover from potential attacks, including rebuild and recovery protocols for key systems. We
evaluate our enterprise information security risk to address unexpected or unforeseen changes in the risk environment or our
systems and the resulting impacts are communicated to the Company’s overall enterprise risk management program.
We believe our Chief Digital and Technology Officer and our Chief Security Officer have the appropriate knowledge and
expertise to effectively manage our cybersecurity program. The Chief Digital and Technology Officer has experience leading
enterprise digital transformation efforts for a large multinational corporation and held several leadership and growth positions at
a global technology consulting and services firm before joining UnitedHealth Group. Our Chief Security Officer has more than
30 years of experience as a security professional in both the private and public sectors, including in law enforcement. Prior to
joining UnitedHealth Group, he served in security leadership roles at several large multinational corporations and has
additionally served on cybersecurity advisory boards for some of the largest corporations in the country.
As of December 31, 2024, the Company has not identified any risks from cybersecurity threats that have materially affected or
are reasonably likely to materially affect the Company, including our business strategy, results of operations or financial
condition, but there can be no assurance that any such risk will not materially affect the Company in the future. For further
information about the cybersecurity risks we face, and potential impacts, see Part I, Item 1A, “Risk Factors.”
21
ITEM 2.
PROPERTIES
We own and lease real properties to support our business operations in the United States and other countries. Our reportable
segments use these facilities for their respective business purposes, and we believe the current facilities are suitable for their
respective uses and are adequate for our anticipated future needs.
ITEM 3.
LEGAL PROCEEDINGS
The information required by this Item 3 is incorporated herein by reference to the information set forth under the captions
“Legal Matters” and “Government Investigations, Audits and Reviews” in Note 12 of the Notes to the Consolidated Financial
Statements included in Part II, Item 8, “Financial Statements and Supplementary Data”
ITEM 4.
MINE SAFETY DISCLOSURES
Not Applicable.
PART II
ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
MARKET AND HOLDERS
Our common stock is traded on the New York Stock Exchange (NYSE) under the symbol UNH. On January 31, 2025, there
were 9,323 holders of record of our common stock.
DIVIDEND POLICY
In June 2024, our Board of Directors increased the Company’s quarterly cash dividend to shareholders to an annual rate of
$8.40 compared to $7.52 per share, which the Company had paid since June 2023. Declaration and payment of future quarterly
dividends is at the discretion of the Board and may be adjusted as business needs or market conditions change.
ISSUER PURCHASES OF EQUITY SECURITIES
Issuer Purchases of Equity Securities (a)
Fourth Quarter 2024
For the Month Ended
Total Number of
Shares Purchased
Average Price Paid
Per Share
Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs
Maximum Number of
Shares That May Yet Be
Purchased Under The
Plans or Programs
(in millions)
(in millions)
(in millions)
October 31, 2024 .............................
2.6 $
568.70
2.6
39.6
November 30, 2024 .........................
0.9
593.39
0.9
38.7
December 31, 2024 ..........................
5.6
513.93
5.6
33.1
Total .................................................
9.1 $
537.14
9.1
(a)
In November 1997, our Board of Directors adopted a share repurchase program, which the Board of Directors evaluates periodically. In June 2024, the
Board of Directors amended our share repurchase program to authorize the repurchase of up to 35 million shares of our common stock in open market
purchases or other types of transactions (including prepaid or structured repurchase programs), in addition to all remaining shares authorized to be
repurchased under the Board’s 2018 renewal of the program. There is no established expiration date for the program. The Board of Directors from time
to time may further amend the share repurchase program in order to increase the authorized number of shares which may be repurchased under the
program.
22
PERFORMANCE GRAPH
The following performance graph compares the cumulative five-year total return to shareholders on our common stock relative
to the cumulative total returns of the S&P 500 Health Care Index, the Dow Jones US Industrial Average Index and the S&P 500
Index for the five-year period ended December 31, 2024. The comparisons assume the investment of $100 on December 31,
2019 in our common stock and in each index, and the reinvestment of dividends when paid.
12/19
12/20
12/21
12/22
12/23
12/24
UnitedHealth Group .................................. $
100.00 $
121.20 $
176.01 $
188.23 $
189.73 $
185.15
S&P 500 Health Care Index ......................
100.00
113.45
143.09
140.29
143.18
146.87
Dow Jones US Industrial Average ............
100.00
109.72
132.71
123.60
143.60
165.12
S&P 500 Index ............................................
100.00
118.40
152.39
124.79
157.59
197.02
The stock price performance included in this graph is not necessarily indicative of future stock price performance. The
preceding stock performance graph shall not be deemed incorporated by reference by any general statement incorporating by
reference this Annual Report on Form 10-K into any filing under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates such information by
reference, and shall not otherwise be deemed filed under such Acts.
ITEM 6.
RESERVED
23
ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read together with the accompanying Consolidated Financial Statements and Notes to the
Consolidated Financial Statements thereto included in Part II Item 8, “Financial Statements and Supplementary Data.” Readers
are cautioned the statements, estimates, projections or outlook contained in this report, including discussions regarding financial
prospects, economic conditions, trends and uncertainties contained in this Item 7, may constitute forward-looking statements
within the meaning of the PSLRA. These forward-looking statements involve risks and uncertainties which may cause our
actual results to differ materially from the expectations expressed or implied in the forward-looking statements. A description of
some of the risks and uncertainties can be found further below in this Item 7 and in Part I, Item 1A, “Risk Factors.”
Discussions of year-over-year comparisons between 2023 and 2022 are not included in this Form 10-K and can be found in Part
II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Form
10-K for the fiscal year ended December 31, 2023.
EXECUTIVE OVERVIEW
General
UnitedHealth Group is a health care and well-being company with a mission to help people live healthier lives and help make
the health system work better for everyone. Our two distinct, yet complementary businesses — Optum and UnitedHealthcare —
are working to help build a modern, high-performing health system through improved access, affordability, outcomes and
experiences for the individuals and organizations we are privileged to serve.
We have four reportable segments across our two businesses:
•
Optum Health;
•
Optum Insight;
•
Optum Rx; and
•
UnitedHealthcare, which includes UnitedHealthcare Employer & Individual, UnitedHealthcare Medicare & Retirement
and UnitedHealthcare Community & State.
Further information on our business and reportable segments is presented in Part I, Item 1, “Business” and in Note 14 of the
Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”
Change Healthcare Cyberattack
As previously announced, on February 21, 2024, we identified that cybercrime threat actors had gained access to certain
Change Healthcare information technology systems. Upon detection of this outside threat, we isolated the impacted systems to
protect our partners and customers.
We have substantially mitigated the impact to consumers and care providers of the unprecedented cyberattack on the U.S.
health system and restored or replaced the majority of the affected Change Healthcare services. To support care providers we
provided interest-free loans of more than $9 billion through December 31, 2024. For the year ended December 31, 2024, we
incurred $2.2 billion of direct response costs, including costs associated with providing interest-free loans; increased medical
care expenditures, as we suspended some care management activities to help care providers with their workflow processes;
network restoration; and notifications of impacted persons. Optum Insight also experienced estimated business disruption
impacts of $867 million for the year ended December 31, 2024, reflecting lost revenue while maintaining full readiness of the
affected Change Healthcare services. We expect to continue to incur direct response costs and experience business disruption
impacts at a lesser extent in 2025 as we work to bring transaction volumes back to pre-event levels and win new business.
We have determined the estimated total number of individuals impacted by the Change Healthcare cyberattack is approximately
190 million. The vast majority of those people have already been provided individual or substitute notice. The final number will
be confirmed and filed with the Office for Civil Rights. Change Healthcare is not aware of any misuse of individuals’
information as a result of this incident and has not seen electronic medical record databases appear in the data during the
analysis. It is possible that future risks and uncertainties resulting from the Change Healthcare cyberattack, including risks
related to impacted data, litigation, reputational harm, and regulatory actions could adversely affect our financial condition or
results of operations.
24
Business Trends
Our businesses participate in the United States and certain other international health markets. In the United States, health care
spending has grown consistently for many years and comprises 18% of gross domestic product (GDP). We expect overall
spending on health care to continue to grow in the future, due to inflation, medical technology and pharmaceutical
advancement, regulatory requirements, demographic trends in the population and national interest in health and well-being. The
rate of market growth may be affected by a variety of factors, including macroeconomic conditions, which could impact our
results of operations, including our continued efforts to control health care costs.
Pricing Trends. To price our health care benefits, products and services, we start with our view of expected future costs,
including medical care patterns, inflation and labor market dynamics. We frequently evaluate and adjust our approach in each
of the local markets we serve, considering relevant factors, such as product positioning, price competitiveness and
environmental, competitive, legislative and regulatory considerations, including minimum medical loss ratio (MLR) thresholds
and similar revenue adjustments. We will continue seeking to balance growth and profitability across all these dimensions.
The commercial risk market remains highly competitive in the small group, large group and individual segments. We expect
broad-based competition to continue as the industry adapts to individual and employer needs.
Medicare Advantage funding continues to be pressured, as discussed below in “Regulatory Trends and Uncertainties” and we
have observed increased care patterns as discussed below in “Medical Cost Trends.” Our 2025 benefit design approach
contemplates these trends.
In Medicaid, we believe the payment rate environment creates the risk of continued downward pressure on Medicaid margin
percentages. We continue to take a prudent, market-sustainable posture for both new business and maintenance of existing
relationships. We continue to advocate for actuarially sound rates commensurate with our medical cost trends and we remain
dedicated to partnering with those states that are committed to the long-term viability of their programs.
Medical Cost Trends. Our medical cost trends primarily relate to changes in unit costs, care activity and prescription drug costs.
As expected and contemplated in our benefits design, we have continued to observe increased care patterns, which may
continue in future periods. We also observed an upshift in hospital coding intensity and an acceleration in the prescribing of
certain high-cost medications in early response to the Inflation Reduction Act (IRA). We expect these additional factors to
continue into future periods. We endeavor to mitigate those increases by engaging hospitals, physicians and consumers with
information and helping them make clinically sound choices, with the objective of helping them achieve high-quality,
affordable care.
As a result of the Change Healthcare cyberattack, we incurred medical costs related to the impact of the temporary suspension
of some care management activities, impacting our UnitedHealthcare and Optum Health businesses, to help care providers with
their workflow processes. Early in the second quarter we resumed these activities. For the year ended December 31, 2024,
medical costs related to the temporary suspension of some care management activities were approximately $640 million.
Medicaid Redeterminations. Medicaid redeterminations have impacted the number of people served through our Medicaid
offerings, partially offset by an increase in consumers served through our commercial offerings as we endeavor to ensure that
people and families have continued access to care. The Medicaid redetermination process has also caused a timing mismatch
between the current health status of people served through Medicaid and state rate updates, which remained well short of
current care activity. We expect this gap between people’s health status and rates will narrow in 2025.
Delivery System and Payment Modernization. The health care market continues to change based on demographic shifts, new
regulations, political forces and both payer and patient expectations. Health plans and care providers are being called upon to
work together to close gaps in care and improve overall care quality and patient experience, improve the health of populations
and reduce costs. We are working to accelerate this vision through the innovation and integration of our care delivery models
including in-clinic, in-home, behavioral and virtual care, and by using our data and analytics to provide clinicians with the
necessary information in order to provide the best possible care in the most cost efficient setting. We continue to see a greater
number of people enrolled in fully accountable value-based plans rewarding high-quality, affordable care and fostering
collaboration.
This trend is creating needs for health management services which can coordinate care around the primary care physician,
including new primary care channels, and for investments in new clinical and administrative information and management
systems, which we believe provide growth opportunities for our Optum business platform. A key focus of our future growth is
to accelerate the transition from fee-for-service care delivery and payment models to fully accountable value-based care. This
transition requires initial costs such as system enhancements, integrated care coordination technology, physician training and
clinical engagement. Enhanced clinical engagement is a critical step to improving the experience and health outcomes of the
people we serve and should result in lower costs to the overall health system over time.
25
Regulatory Trends and Uncertainties
Following is a summary of management’s view of the trends and uncertainties related to regulatory matters. For additional
information regarding regulatory trends and uncertainties, see Part I, Item 1 “Business - Government Regulation” and Item 1A,
“Risk Factors.”
Medicare Advantage Rates. Medicare Advantage rate notices over the years have at times resulted in industry base rates well
below industry forward medical trend. For example, the Final Notice for 2024 and 2025 rates resulted in an industry base rate
decrease, both of which are well short of what is an increasing industry forward medical cost trend. The Advance Notice for
2026 rates proposes an industry base rate increase also well short of forward medical cost trend, creating continued pressure in
the Medicare Advantage program. Further, substantial revisions to the risk adjustment model, which serves to adjust rates to
reflect a patient’s health status and care resource needs, will result in reduced funding and potentially benefits for people,
especially those with some of the greatest health and social challenges.
As a result of ongoing Medicare funding pressures, there are adjustments we can make to partially offset these rate pressures
and reductions for a particular period. For example, we can seek to intensify our medical and operating cost management, make
changes to the size and composition of our care provider networks, adjust member benefits and implement or increase the
member premiums supplementing the monthly payments we receive from the government. Additionally, we decide annually on
a county-by-county basis where we will offer Medicare Advantage plans.
SELECTED OPERATING PERFORMANCE ITEMS
The following summarizes select 2024 year-over-year operating comparisons to 2023 and other financial results.
•
Consolidated revenues grew 8%, UnitedHealthcare revenues grew 6% and Optum revenues grew 12%.
•
UnitedHealthcare served 2.1 million more people domestically, driven by growth in commercial offerings, partially
offset by the impact of Medicaid redeterminations.
•
Earnings from operations of $32.3 billion compared to $32.4 billion last year.
•
Diluted earnings per common share was $15.51, impacted by the loss on sale of subsidiary and subsidiaries held for sale.
•
Cash flows from operations were $24.2 billion.
26
RESULTS SUMMARY
The following table summarizes our consolidated results of operations and other financial information:
(in millions, except percentages and per share data)
For the Years Ended December 31,
Change
2024
2023
2022
2024 vs. 2023
Revenues:
Premiums .....................................................................................
$
308,810
$
290,827
$
257,157
$
17,983
6%
Products .......................................................................................
50,226
42,583
37,424
7,643
18
Services .......................................................................................
36,040
34,123
27,551
1,917
6
Investment and other income ......................................................
5,202
4,089
2,030
1,113
27
Total revenues ......................................................................................
400,278
371,622
324,162
28,656
8
Operating costs:
Medical costs ...............................................................................
264,185
241,894
210,842
22,291
9
Operating costs ............................................................................
53,013
54,628
47,782
(1,615)
(3)
Cost of products sold ...................................................................
46,694
38,770
33,703
7,924
20
Depreciation and amortization ....................................................
4,099
3,972
3,400
127
3
Total operating costs ............................................................................
367,991
339,264
295,727
28,727
8
Earnings from operations .....................................................................
32,287
32,358
28,435
(71)
—
Interest expense ....................................................................................
(3,906)
(3,246)
(2,092)
(660)
20
Loss on sale of subsidiary and subsidiaries held for sale .....................
(8,310)
—
—
(8,310)
nm
Earnings before income taxes ..............................................................
20,071
29,112
26,343
(9,041)
(31)
Provision for income taxes ...................................................................
(4,829)
(5,968)
(5,704)
1,139
(19)
Net earnings .........................................................................................
15,242
23,144
20,639
(7,902)
(34)
Earnings attributable to noncontrolling interests .................................
(837)
(763)
(519)
(74)
10
Net earnings attributable to UnitedHealth Group common
shareholders ...................................................................................
$
14,405
$
22,381
$
20,120
$
(7,976)
(36) %
Diluted earnings per share attributable to UnitedHealth Group
common shareholders ....................................................................
$
15.51
$
23.86
$
21.18
$
(8.35)
(35) %
Medical care ratio (a) ...........................................................................
85.5 %
83.2 %
82.0 %
2.3 %
Operating cost ratio ..............................................................................
13.2
14.7
14.7
(1.5)
Operating margin .................................................................................
8.1
8.7
8.8
(0.6)
Tax rate .................................................................................................
24.1
20.5
21.7
3.6
Net earnings margin (b) .......................................................................
3.6
6.0
6.2
(2.4)
Return on equity (c) .............................................................................
15.9 %
27.0 %
27.2 %
(11.1) %
________
nm = not meaningful
(a)
Medical care ratio (MCR) is calculated as medical costs divided by premium revenue.
(b)
Net earnings margin attributable to UnitedHealth Group common shareholders.
(c)
Return on equity is calculated as net earnings attributable to UnitedHealth Group common shareholders divided by average shareholders’ equity.
Average shareholders’ equity is calculated using the shareholders’ equity balance at the end of the preceding year and the shareholders’ equity balances
at the end of each of the four quarters of the year presented.
2024 RESULTS OF OPERATIONS COMPARED TO 2023 RESULTS
Consolidated Financial Results
Revenues
The increases in revenues were primarily driven by growth in Optum Rx, UnitedHealthcare’s domestic offerings and Optum
Health, partially offset by the sale of UnitedHealthcare’s Brazil operations.
Medical Costs and MCR
Medical costs increased primarily due to growth in people served through Medicare Advantage and domestic commercial
offerings and member mix. The MCR increased as a result of the revenue effects of the Medicare funding reductions, Medicaid
timing mismatch between people’s health status and rates, upshift in hospital coding intensity, specialty pharmaceutical
prescribing patterns, member mix and due to incremental medical costs for accommodations made to care providers as a result
of the Change Healthcare cyberattack.
27
Operating Cost Ratio
The operating cost ratio decreased primarily due to operating cost management and gains related to business portfolio
refinement, including strategic transactions, partially offset by the impact of our direct response efforts to the Change
Healthcare cyberattack and investments to support future growth.
Loss on Sale of Subsidiary and Subsidiaries Held for Sale
On February 6, 2024, the Company completed the sale of its Brazil operations. During the year ended December 31, 2024, we
recorded a loss of $7.1 billion, of which $4.1 billion related to the impact of cumulative foreign currency translation losses
previously included in accumulated other comprehensive loss.
In the second quarter of 2024, the Company initiated a plan to sell its remaining South American operations, which were
classified as held for sale as of December 31, 2024. During the year ended December 31, 2024, we recorded a loss of $1.2
billion, of which $855 million related to the impact of cumulative foreign currency translation losses.
Reportable Segments
See Note 14 of Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and
Supplementary Data” for more information on our segments. We utilize various metrics to evaluate and manage our reportable
segments, including individuals served by UnitedHealthcare by major market segment and funding arrangement, people served
by Optum Health and adjusted scripts for Optum Rx. These metrics are the main drivers of revenue, earnings and cash flows at
each business. The metrics also allow management and investors to evaluate and understand business mix, including the level
and scope of services provided to people and pricing trends when comparing the metrics to revenue by segment.
The following table presents a summary of the reportable segment financial information:
For the Years Ended December 31,
Change
(in millions, except percentages)
2024
2023
2022
2024 vs. 2023
Revenues
UnitedHealthcare ....................................................................................
$
298,208
$
281,360
$
249,741
$
16,848
6%
Optum Health ................................................................................
105,358
95,319
71,174
10,039
11
Optum Insight ................................................................................
18,757
18,932
14,581
(175)
(1)
Optum Rx ......................................................................................
133,231
116,087
99,773
17,144
15
Optum eliminations .......................................................................
(4,389)
(3,703)
(2,760)
(686)
19
Optum .....................................................................................................
252,957
226,635
182,768
26,322
12
Eliminations ............................................................................................
(150,887)
(136,373)
(108,347)
(14,514)
11
Consolidated revenues ............................................................................
$
400,278
$
371,622
$
324,162
$
28,656
8%
Earnings from operations
UnitedHealthcare ....................................................................................
$
15,584
$
16,415
$
14,379
$
(831)
(5) %
Optum Health ................................................................................
7,770
6,560
6,032
1,210
18
Optum Insight ................................................................................
3,097
4,268
3,588
(1,171)
(27)
Optum Rx ......................................................................................
5,836
5,115
4,436
721
14
Optum .....................................................................................................
16,703
15,943
14,056
760
5
Consolidated earnings from operations ..................................................
$
32,287
$
32,358
$
28,435
$
(71)
— %
Operating margin
UnitedHealthcare ....................................................................................
5.2 %
5.8 %
5.8 %
(0.6) %
Optum Health ................................................................................
7.4
6.9
8.5
0.5
Optum Insight ................................................................................
16.5
22.5
24.6
(6.0)
Optum Rx ......................................................................................
4.4
4.4
4.4
—
Optum .....................................................................................................
6.6
7.0
7.7
(0.4)
Consolidated operating margin ..............................................................
8.1 %
8.7 %
8.8 %
(0.6) %
28
UnitedHealthcare
The following table summarizes UnitedHealthcare revenues by business:
For the Years Ended December 31,
Change
(in millions, except percentages)
2024
2023
2022
2024 vs. 2023
UnitedHealthcare Employer & Individual - Domestic .............
$
74,489 $
67,187 $
63,599 $
7,302
11 %
UnitedHealthcare Employer & Individual - Global ..................
3,667
9,307
8,668
(5,640)
(61)
UnitedHealthcare Employer & Individual - Total .............
78,156
76,494
72,267
1,662
2
UnitedHealthcare Medicare & Retirement ...............................
139,482
129,862
113,671
9,620
7
UnitedHealthcare Community & State .....................................
80,570
75,004
63,803
5,566
7
Total UnitedHealthcare revenues ......................................
$ 298,208 $ 281,360 $ 249,741 $ 16,848
6 %
The following table summarizes the number of individuals served by our UnitedHealthcare businesses, by major market
segment and funding arrangement:
December 31,
Change
(in thousands, except percentages)
2024
2023
2022
2024 vs. 2023
Commercial - domestic:
Risk-based ........................................................................
8,845
8,115
8,045
730
9 %
Fee-based ..........................................................................
20,885
19,200
18,640
1,685
9
Total commercial - domestic ..........................................
29,730
27,315
26,685
2,415
9
Medicare Advantage ...........................................................
7,845
7,695
7,105
150
2
Medicaid .............................................................................
7,435
7,845
8,170
(410)
(5)
Medicare Supplement (Standardized) .................................
4,335
4,355
4,375
(20)
—
Total community and senior .........................................
19,615
19,895
19,650
(280)
(1)
Total UnitedHealthcare - domestic medical .................
49,345
47,210
46,335
2,135
5
Commercial - global ...........................................................
1,330
5,540
5,360
(4,210)
(76)
Total UnitedHealthcare - medical .................................
50,675
52,750
51,695
(2,075)
(4) %
Supplemental Data:
Medicare Part D stand-alone ...........................................
3,050
3,315
3,295
(265)
(8) %
UnitedHealthcare’s revenues increased due to growth in the number of people served through Medicare Advantage and
domestic commercial offerings, partially offset by decreased people served globally due to the sale of the Brazil operations and
in Medicaid offerings due to redeterminations. Earnings from operations decreased due to Medicare Advantage funding
reductions, the impacts of Medicaid redeterminations, member mix and incremental medical costs for accommodations to
support care providers as a result of the Change Healthcare cyberattack, partially offset by gains related to business portfolio
refinement, including strategic transactions, and the growth in the number of people served through Medicare Advantage and
domestic commercial offerings.
Optum
Total revenues increased due to growth at Optum Rx and Optum Health. Earnings from operations increased with growth at
Optum Health and Optum Rx, partially offset by decreased earnings from operations at Optum Insight. The results by segment
were as follows:
Optum Health
Revenues at Optum Health increased primarily due to organic growth in patients served under value-based care arrangements.
Earnings from operations increased due to gains related to business portfolio refinement, including strategic transactions,
increased investment income and cost management initiatives, partially offset by Medicare Advantage funding reductions, costs
associated with serving newly added patients under value-based care arrangements and medical care activity. Optum Health
served approximately 100 million people as of December 31, 2024 compared to 103 million people as of December 31, 2023.
29
Optum Insight
Revenues at Optum Insight decreased primarily due the business disruption impacts from the Change Healthcare cyberattack,
partially offset by growth in technology services. Earnings from operations decreased primarily due to direct response costs and
business disruption impacts related to the Change Healthcare cyberattack, partially offset by gains related to business portfolio
refinement, including strategic transactions.
Optum Rx
Revenues and earnings from operations at Optum Rx increased due to higher script volumes from both new clients and growth
in existing clients and growth in pharmacy services. Earnings from operations also increased due to operating cost efficiencies
and supply chain initiatives. Optum Rx fulfilled 1,623 million and 1,542 million adjusted scripts in 2024 and 2023,
respectively.
LIQUIDITY, FINANCIAL CONDITION AND CAPITAL RESOURCES
Liquidity
Introduction
We manage our liquidity and financial position in the context of our overall business strategy. We continually forecast and
manage our cash, investments, working capital balances and capital structure to meet the short-term and long-term obligations
of our businesses while seeking to maintain liquidity and financial flexibility. Cash flows generated from operating activities
are principally derived from earnings before noncash expenses.
Our regulated subsidiaries generate significant cash flows from operations and are subject to, among other things, minimum
levels of statutory capital, as defined by their respective jurisdictions, and restrictions on the timing and amount of dividends
paid to their parent companies.
Our U.S. regulated subsidiaries paid their parent companies dividends of $9.2 billion and $8.0 billion in 2024 and 2023,
respectively. See Note 10 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial
Statements and Supplementary Data” for further detail concerning our regulated subsidiary dividends.
Our nonregulated businesses also generate significant cash flows from operations available for general corporate use. Cash
flows generated by these entities, combined with dividends from our regulated entities and financing through the issuance of
long-term debt as well as issuance of commercial paper or the ability to draw under our committed credit facilities, further
strengthen our operating and financial flexibility. We use these cash flows to expand our businesses through acquisitions,
reinvest in our businesses through capital expenditures, repay debt and return capital to our shareholders through dividends and
repurchases of our common stock.
30
Summary of our Major Sources and Uses of Cash and Cash Equivalents
For the Years Ended December 31,
Change
(in millions)
2024
2023
2022
2024 vs. 2023
Sources of cash:
Cash provided by operating activities .................................................
$ 24,204 $ 29,068 $ 26,206 $
(4,864)
Issuances of long-term debt and short-term borrowings, net of
repayments .......................................................................................
14,660
4,280
12,536
10,380
Proceeds from common share issuances .............................................
1,846
1,353
1,253
493
Customer funds administered ..............................................................
—
—
5,548
—
Cash received for dispositions ............................................................
2,041
685
3,414
1,356
Sales and maturities of investments, net of purchases ........................
525
—
—
525
Total sources of cash ..................................................................................
43,276
35,386
48,957
7,890
Uses of cash:
Cash paid for acquisitions and other transactions, net of cash
assumed ...........................................................................................
(13,408) (10,136) (21,458)
(3,272)
Common share repurchases .................................................................
(9,000)
(8,000)
(7,000)
(1,000)
Cash dividends paid ............................................................................
(7,533)
(6,761)
(5,991)
(772)
Purchases of property, equipment and capitalized software ...............
(3,499)
(3,386)
(2,802)
(113)
Purchases of investments, net of sales and maturities ........................
—
(1,777)
(6,837)
1,777
Purchases of redeemable noncontrolling interests ..............................
(280)
(730)
(176)
450
Loans to care providers - cyberattack, net of repayments ...................
(4,519)
—
—
(4,519)
Customer funds administered ..............................................................
(1,560)
(521)
—
(1,039)
Other ....................................................................................................
(3,312)
(2,110)
(2,737)
(1,202)
Total uses of cash .......................................................................................
(43,111) (33,421) (47,001)
(9,690)
Effect of exchange rate changes on cash and cash equivalents ..................
(61)
97
34
(158)
Net increase in cash and cash equivalents, including cash within
businesses held for sale ..........................................................................
$
104 $
2,062 $
1,990 $
(1,958)
Less: cash within businesses held for sale ..................................................
(219)
—
—
(219)
Net (decrease) increase in cash and cash equivalents ................................
$
(115) $
2,062 $
1,990 $
(2,177)
2024 Cash Flows Compared to 2023 Cash Flows
Decreased cash flows provided by operating activities were primarily driven by CMS Medicare funding reductions, Change
Healthcare cyberattack response actions, increased medical costs and changes in working capital accounts. Other significant
changes in sources or uses of cash year-over-year included increased net issuances of short-term borrowings and long-term
debt, net sales and maturities of investments and cash received from dispositions, offset by loans to care providers in response
to the Change Healthcare cyberattack, increased cash paid for acquisitions and other transactions, decreased customer funds
administered and increased share repurchases.
Financial Condition
As of December 31, 2024, our cash, cash equivalent, available-for-sale debt securities and equity securities balances of $77.1
billion included $25.3 billion of cash and cash equivalents (of which approximately $800 million was available for general
corporate use), $46.9 billion of debt securities and $4.9 billion of equity securities. Given the significant portion of our portfolio
held in cash equivalents, we do not anticipate fluctuations in the aggregate fair value of our financial assets to have a material
impact on our liquidity or capital position. Other sources of liquidity, primarily from operating cash flows and our commercial
paper program, which is fully supported by our bank credit facilities, reduce the need to sell investments during adverse market
conditions. See Note 4 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements
and Supplementary Data” for further detail concerning our fair value measurements.
Our available-for-sale debt portfolio had a weighted-average duration of 4.2 years and a weighted-average credit rating of
“Double A” as of December 31, 2024. When multiple credit ratings are available for an individual security, the average of the
available ratings is used to determine the weighted-average credit rating.
31
Capital Resources and Uses of Liquidity
Cash Requirements. The Company’s cash requirements within the next twelve months include medical costs payable, accounts
payable and accrued liabilities, short-term borrowings and current maturities of long-term debt, other current liabilities, and
purchase commitments and other obligations. We expect the cash required to meet these obligations to be primarily generated
through cash flows from current operations; cash available for general corporate use; and the realization of current assets, such
as accounts receivable.
Our long-term cash requirements under our various contractual obligations and commitments include:
•
Debt obligations. See Note 8 of the Notes to the Consolidated Financial Statements included in Part II, Item 8,
“Financial Statements and Supplementary Data” for further detail of our long-term debt and the timing of expected
future payments. Interest coupon payments are typically paid semi-annually.
•
Operating leases. See Note 12 of the Notes to the Consolidated Financial Statements included in Part II, Item 8,
“Financial Statements and Supplementary Data” for further detail of our obligations and the timing of expected future
payments.
•
Purchase and other obligations. These include $11.5 billion, $2.4 billion of which is expected to be paid within the
next twelve months, of fixed or minimum commitments under existing purchase obligations for goods and services,
including agreements cancelable with the payment of an early termination penalty, and remaining capital commitments
for venture capital funds, strategic transactions and other funding commitments. These amounts exclude agreements
cancelable without penalty and liabilities to the extent recorded in our Consolidated Balance Sheets as of
December 31, 2024.
•
Other liabilities. These include other long-term liabilities reflected in our Consolidated Balance Sheets as of
December 31, 2024, including obligations associated with certain employee benefit programs, unrecognized tax
benefits and various long-term liabilities, which have some inherent uncertainty in the timing of these payments.
•
Redeemable noncontrolling interests. See Note 2 of the Notes to the Consolidated Financial Statements included in
Part II, Item 8, “Financial Statements and Supplementary Data” for further detail. We do not have any material
potential required redemptions in the next twelve months.
We expect the cash required to meet our long-term obligations to be primarily generated through future cash flows from
operations. However, we also have the ability to generate cash to satisfy both our current and long-term requirements through
the issuance of commercial paper, issuance of long-term debt, or drawing under our committed credit facilities or the ability to
sell investments. We believe our capital resources are sufficient to meet future, short-term and long-term, liquidity needs.
Short-Term Borrowings. Our revolving bank credit facilities provide liquidity support for our commercial paper borrowing
program, which facilitates the private placement of senior unsecured debt through independent broker-dealers, and are available
for general corporate purposes. For more information on our commercial paper and bank credit facilities, see Note 8 of the
Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”
As of December 31, 2024, we were in compliance with the various covenants under our bank credit facilities.
Long-Term Debt. Periodically, we access capital markets to issue long-term debt for general corporate purposes, such as to
meet our working capital requirements, to refinance debt, to finance acquisitions or for share repurchases. For more information
on our debt, see Note 8 of the Notes to the Consolidated Financial Statements included in Part II, Item 8 “Financial Statements
and Supplementary Data.”
Credit Ratings. Our credit ratings as of December 31, 2024 were as follows:
Moody’s
S&P Global
Fitch
A.M. Best
Ratings
Outlook
Ratings
Outlook
Ratings
Outlook
Ratings
Outlook
Senior unsecured debt .........
A2
Stable
A+
Stable
A
Stable
A
Stable
Commercial paper ...............
P-1
n/a
A-1
n/a
F1
n/a
AMB-1+
n/a
The availability of financing in the form of debt or equity is influenced by many factors, including our profitability, operating
cash flows, debt levels, credit ratings, debt covenants and other contractual restrictions, regulatory requirements and economic
and market conditions. A significant downgrade in our credit ratings or adverse conditions in the capital markets may increase
the cost of borrowing for us or limit our access to capital.
32
Share Repurchase Program. In June 2024, our Board of Directors amended our share repurchase program to authorize the
repurchase of up to 35 million shares of Common Stock, in addition to all remaining shares authorized to be repurchased under
the Board’s 2018 renewal of the program. As of December 31, 2024, we had Board of Directors’ authorization to purchase up
to 33 million shares of our common stock. The Board of Directors from time to time may further amend the share repurchase
program in order to increase the authorized number of shares which may be repurchased under the program. For more
information on our share repurchase program, see Note 10 of the Notes to the Consolidated Financial Statements included in
Part II, Item 8, “Financial Statements and Supplementary Data.”
Dividends. In June 2024, our Board of Directors increased the Company’s quarterly cash dividend to shareholders to an annual
rate of $8.40 compared to $7.52 per share. For more information on our dividend, see Note 10 of the Notes to the Consolidated
Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”
Pending Acquisitions. As of December 31, 2024, we have entered into agreements to acquire companies in the health care
sector, subject to regulatory approval and other customary closing conditions. The total anticipated capital required for these
acquisitions, excluding the payoff of acquired indebtedness, is approximately $4 billion.
We do not have other significant contractual obligations or commitments requiring cash resources. However, we continually
evaluate opportunities to expand our operations, which include internal development of new products, programs and technology
applications and may include acquisitions.
CRITICAL ACCOUNTING ESTIMATES
Critical accounting estimates are those estimates requiring management to make challenging, subjective or complex judgments,
often because they must estimate the effects of matters inherently uncertain and may change in subsequent periods. Critical
accounting estimates involve judgments and uncertainties which are sufficiently sensitive and may result in materially different
results under different assumptions and conditions.
Medical Costs Payable
Medical costs and medical costs payable include estimates of our obligations for medical care services rendered on behalf of
consumers, but for which claims have either not yet been received or processed. Depending on the health care professional and
type of service, the typical billing lag for services can be up to 90 days from the date of service. Approximately 90% of claims
related to medical care services are known and settled within 90 days from the date of service.
In each reporting period, our operating results include the effects of more completely developed medical costs payable
estimates associated with previously reported periods. If the revised estimate of prior period medical costs is less than the
previous estimate, we will decrease reported medical costs in the current period (favorable development). If the revised estimate
of prior period medical costs is more than the previous estimate, we will increase reported medical costs in the current period
(unfavorable development). Medical costs in 2024, 2023 and 2022 included favorable medical cost development related to prior
years of $700 million, $840 million and $410 million, respectively.
In developing our medical costs payable estimates, we apply different estimation methods depending on the month for which
incurred claims are being estimated. For example, for the most recent two months, we estimate claim costs incurred by applying
observed medical cost trend factors to the average per member per month (PMPM) medical costs incurred in prior months for
which more complete claim data is available, supplemented by a review of near-term completion factors.
Completion Factors. A completion factor is an actuarial estimate, based upon historical experience and analysis of current
trends, of the percentage of incurred claims during a given period adjudicated by us at the date of estimation. Completion
factors are the most significant factors we use in developing our medical costs payable estimates for periods prior to the most
recent two months. Completion factors include judgments in relation to claim submissions such as the time from date of service
to claim receipt, claim levels and processing cycles, as well as other factors. If actual claims submission rates from providers
(which can be influenced by a number of factors, including provider mix and electronic versus manual submissions), actual care
activity incurred (which can be influenced by pandemics or seasonal illnesses, such as influenza), or our claim processing
patterns are different than estimated, our reserve estimates may be significantly impacted.
33
The following table illustrates the sensitivity of these factors and the estimated potential impact on our medical costs payable
estimates for those periods as of December 31, 2024:
Completion Factors
(Decrease) Increase in Factors
Increase (Decrease)
In Medical Costs Payable
(in millions)
(0.75)% .............................................................................................................................................. $
973
(0.50) .................................................................................................................................................
647
(0.25) .................................................................................................................................................
322
0.25 ....................................................................................................................................................
(321)
0.50 ....................................................................................................................................................
(640)
0.75 ....................................................................................................................................................
(958)
Medical Cost Per Member Per Month Trend Factors. Medical cost PMPM trend factors are significant factors we use in
developing our medical costs payable estimates for the most recent two months. Medical cost trend factors are developed
through a comprehensive analysis of claims incurred in prior months, provider contracting and expected unit costs, benefit
design and a review of a broad set of health care utilization indicators. These factors include but are not limited to pharmacy
utilization trends, inpatient hospital authorization data and seasonal and other incidence data from the National Centers for
Disease Control. We also consider macroeconomic variables such as GDP growth, employment and disposable income. A large
number of factors can cause the medical cost trend to vary from our estimates, including: our ability and practices to manage
medical and pharmaceutical costs, changes in level and mix of services utilized; mix of benefits offered, including the impact of
co-pays and deductibles; changes in medical practices; and catastrophes, epidemics and pandemics.
The following table illustrates the sensitivity of these factors and the estimated potential impact on our medical costs payable
estimates for the most recent two months as of December 31, 2024:
Medical Cost PMPM Quarterly Trend
Increase (Decrease) in Factors
Increase (Decrease)
In Medical Costs Payable
(in millions)
3% ...................................................................................................................................................... $
1,264
2 .........................................................................................................................................................
843
1 .........................................................................................................................................................
421
(1) ......................................................................................................................................................
(421)
(2) ......................................................................................................................................................
(843)
(3) ......................................................................................................................................................
(1,264)
The completion factors and medical costs PMPM trend factors analyses above include outcomes considered reasonably likely
based on our historical experience estimating liabilities for incurred but not reported benefit claims.
Management believes the amount of medical costs payable is reasonable and adequate to cover our liability for unpaid claims as
of December 31, 2024; however, actual claim payments may differ from established estimates as discussed above. Assuming a
hypothetical 1% difference between our December 31, 2024 estimates of medical costs payable and actual medical costs
payable, 2024 net earnings would have increased or decreased by approximately $260 million.
For more detail related to our medical cost estimates, see Note 2 of the Notes to the Consolidated Financial Statements included
in Part II, Item 8, “Financial Statements and Supplementary Data.”
Goodwill
We evaluate goodwill for impairment annually or more frequently when an event occurs or circumstances change indicating the
carrying value may not be recoverable. When testing goodwill for impairment, we may first assess qualitative factors to
determine if it is more likely than not the carrying value of a reporting unit exceeds its estimated fair value. During a qualitative
analysis, we consider the impact of changes, if any, to the following factors: macroeconomic, industry and market factors; cost
factors; changes in overall financial performance; and any other relevant events and uncertainties impacting a reporting unit. If
our qualitative assessment indicates a goodwill impairment is more likely than not, we perform additional quantitative analyses.
We may also elect to skip the qualitative testing and proceed directly to the quantitative testing. For reporting units where a
quantitative analysis is performed, we perform a test measuring the fair values of the reporting units and comparing them to
their carrying values, including goodwill. If the fair value is less than the carrying value of the reporting unit, an impairment is
recognized for the difference, up to the carrying amount of goodwill.
34
We estimate the fair values of our reporting units using a discounted cash flow method which includes assumptions about a
wide variety of internal and external factors. Significant assumptions used in the discounted cash flow method include financial
projections of free cash flow, including revenue trends, medical costs trends, operating productivity, income taxes and capital
levels; long-term growth rates for determining terminal value beyond the discretely forecasted periods; and discount rates. For
each reporting unit, comparative market multiples are used to corroborate the results of our discounted cash flow test.
Financial projections and long-term growth rates used for our reporting units are consistent with, and use inputs from, our
internal long-term business plan and strategies. Discount rates are determined for each reporting unit and include consideration
of the implied risk inherent in their forecasts. Our most significant estimate in the discount rate determinations involves our
adjustments to the peer company weighted average costs of capital reflecting reporting unit-specific factors. We have not made
any adjustments to decrease a discount rate below the calculated peer company weighted average cost of capital for any
reporting unit. Company-specific adjustments to discount rates are subjective and thus are difficult to measure with certainty.
The passage of time and the availability of additional information regarding areas of uncertainty with respect to the reporting
units’ operations could cause these assumptions to change in the future. Additionally, as part of our quantitative impairment
testing, we perform various sensitivity analyses on certain key assumptions, such as discount rates and cash flow projections to
analyze the potential for a material impact. As of October 1, 2024, we completed our annual impairment tests for goodwill with
all of our reporting units having fair values substantially in excess of their carrying values.
LEGAL MATTERS
A description of our legal proceedings is presented in Note 12 of Notes to the Consolidated Financial Statements included in
Part II, Item 8, “Financial Statements and Supplementary Data.”
CONCENTRATIONS OF CREDIT RISK
Investments in financial instruments such as marketable securities and accounts receivable may subject us to concentrations of
credit risk. Our investments in marketable securities are managed under an investment policy authorized by our Board of
Directors. This policy limits the amounts which may be invested in any one issuer and generally limits our investments to U.S.
government and agency securities, state and municipal securities and corporate debt obligations of investment grade.
Concentrations of credit risk with respect to accounts receivable are limited due to the large number of employer groups and
other customers constituting our client base. As of December 31, 2024, there were no significant concentrations of credit risk.
35
ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our primary market risks are exposures to changes in interest rates impacting our investment income and interest expense and
the fair value of certain of our fixed-rate investments and debt.
As of December 31, 2024, we had $33 billion of financial assets on which the interest rates received vary with market interest
rates, which may significantly impact our investment income. Also as of December 31, 2024, $27 billion of our financial
liabilities, which include debt and deposit liabilities, were at interest rates which vary with market rates, either directly or
through the use of related interest rate swap contracts.
The fair value of our fixed-rate investments and debt also varies with market interest rates. As of December 31, 2024, $46
billion of our investments were fixed-rate debt securities and $49 billion of our debt was non-swapped fixed-rate term debt. An
increase in market interest rates decreases the market value of fixed-rate investments and fixed-rate debt. Conversely, a
decrease in market interest rates increases the market value of fixed-rate investments and fixed-rate debt.
We manage exposure to market interest rates by diversifying investments across different fixed-income market sectors and debt
across maturities, as well as by matching a portion of our floating-rate assets and liabilities, either directly or through the use of
interest rate swap contracts. Unrealized gains and losses on investments in available-for-sale debt securities are reported in
comprehensive income.
The following tables summarize the impact of hypothetical changes in market interest rates across the entire yield curve by 1%
point or 2% points as of December 31, 2024 and 2023 on our investment income and interest expense per annum and the fair
value of our investments and debt (in millions, except percentages):
December 31, 2024
Increase (Decrease) in Market Interest Rate
Investment
Income Per
Annum
Interest
Expense Per
Annum
Fair Value of
Financial Assets
Fair Value of
Financial Liabilities
2 % .......................................................................
$
666 $
537 $
(4,151) $
(8,866)
1 ............................................................................
333
268
(2,182)
(4,828)
(1) ..........................................................................
(333)
(252)
2,082
5,831
(2) ..........................................................................
(666)
(503)
4,311
12,935
December 31, 2023
Increase (Decrease) in Market Interest Rate
Investment
Income Per
Annum
Interest
Expense Per
Annum
Fair Value of
Financial Assets
Fair Value of
Financial Liabilities
2% ......................................................................... $
688 $
393 $
(3,642) $
(8,142)
1 ............................................................................
344
196
(1,871)
(4,444)
(1) ..........................................................................
(344)
(180)
1,954
5,391
(2) ..........................................................................
(688)
(360)
3,964
11,992
Note: The impact of hypothetical changes in interest rates may not reflect the full 100 or 200 basis point change on interest income and interest
expense or on the fair value of financial assets and liabilities as the rates are assumed to not fall below zero.
As of December 31, 2024, we had $4.9 billion of investments in equity securities, primarily consisting of venture investments
and employee savings plan related investments.
36
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Page
Report of Independent Registered Public Accounting Firm (PCAOB ID No 34) ................................................
38
Consolidated Balance Sheets .................................................................................................................................
40
Consolidated Statements of Operations .................................................................................................................
41
Consolidated Statements of Comprehensive Income ............................................................................................
42
Consolidated Statements of Changes in Equity .....................................................................................................
43
Consolidated Statements of Cash Flows ................................................................................................................
44
Notes to the Consolidated Financial Statements ....................................................................................................
45
1. Description of Business .......................................................................................................................
45
2. Basis of Presentation, Use of Estimates and Significant Accounting Policies ....................................
45
3. Investments .........................................................................................................................................
50
4. Fair Value ............................................................................................................................................
51
5. Property, Equipment and Capitalized Software ...................................................................................
54
6. Goodwill and Other Intangible Assets .................................................................................................
54
7. Medical Costs Payable .........................................................................................................................
55
8. Short-Term Borrowings and Long-Term Debt ....................................................................................
57
9. Income Taxes .......................................................................................................................................
58
10. Shareholders’ Equity ............................................................................................................................
60
11. Share-Based Compensation .................................................................................................................
61
12. Commitments and Contingencies ........................................................................................................
63
13. Dispositions and Held for Sale ............................................................................................................
64
14. Segment Financial Information ............................................................................................................
65
37
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of UnitedHealth Group Incorporated and Subsidiaries:
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of UnitedHealth Group Incorporated and Subsidiaries (the
“Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income,
changes in equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes
(collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material
respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally
accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in
Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission and our report dated February 27, 2025 expressed an unqualified opinion on the Company’s internal control over
financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on
the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that
was communicated or required to be communicated to the Audit and Finance Committee and that (1) relates to accounts or
disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex
judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken
as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit
matter or on the accounts or disclosures to which it relates.
Medical Care Services Incurred but not Reported (IBNR) - Refer to Notes 2 and 7 to the financial statements.
Critical Audit Matter Description
Medical costs payable includes estimates of the Company’s obligations for medical care services rendered on behalf of insured
consumers, for which claims have either not yet been received or processed. The Company develops estimates for medical care
services incurred but not reported (IBNR) using an actuarial model that requires management to exercise certain judgments in
developing its estimates. Judgments made by management include medical cost per member per month trend factors and
completion factors, which include assumptions over the time from date of service to claim receipt, the impact of actual care
activity, and processing cycles.
We identified medical care services IBNR as a critical audit matter because it requires significant management assumptions in
estimating the liability. This required complex auditor judgment, and an increased extent of effort, including the involvement of
actuarial specialists in performing procedures to evaluate the reasonableness of management’s methods, assumptions, and
judgments in developing estimates for medical care services IBNR.
38
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to medical care services IBNR included the following, among others:
•
We tested the effectiveness of controls over management’s estimate of the IBNR for these services, including controls
over the judgments in both the completion factors and the medical cost per member per month trend factors, as well as
controls over the claims and membership data used in the estimation process.
•
We tested the underlying claims and membership data and other information that served as the basis for the actuarial
analysis, to test that the inputs to the actuarial estimate were complete and accurate.
•
With the assistance of actuarial specialists, we evaluated the reasonableness of the actuarial methods and assumptions
used by management to estimate IBNR for these services by:
–
Performing an overlay of the historical claims data used in management’s current year model to the data used
in prior periods to validate that there were no material changes to the claims data tested in prior periods.
–
Developing an independent estimate of the IBNR for these services and comparing our estimate to
management’s estimate.
–
Performing a retrospective review comparing management’s prior year estimate of IBNR to claims processed
in 2024 with dates of service in 2023 or prior.
/S/ DELOITTE & TOUCHE LLP
Minneapolis, Minnesota
February 27, 2025
We have served as the Company's auditor since 2002.
39
UnitedHealth Group
Consolidated Balance Sheets
(in millions, except per share data)
December 31,
2024
December 31,
2023
Assets
Current assets:
Cash and cash equivalents ......................................................................................................
$
25,312 $
25,427
Short-term investments ..........................................................................................................
3,801
4,201
Accounts receivable, net of allowances of $985 and $1,000 .................................................
22,365
21,276
Other current receivables, net of allowances of $2,864 and $2,084 ......................................
26,089
17,694
Assets under management ......................................................................................................
—
3,755
Prepaid expenses and other current assets ..............................................................................
8,212
6,084
Total current assets ........................................................................................................................
85,779
78,437
Long-term investments ..................................................................................................................
52,354
47,609
Property, equipment and capitalized software, net of accumulated depreciation and
amortization of $6,971 and $7,039 .........................................................................................
10,553
11,450
Goodwill ........................................................................................................................................
106,734
103,732
Other intangible assets, net of accumulated amortization of $8,350 and $7,279 ..........................
23,268
15,194
Other assets ....................................................................................................................................
19,590
17,298
Total assets ...................................................................................................................................
$
298,278 $
273,720
Liabilities, redeemable noncontrolling interests and equity
Current liabilities:
Medical costs payable ............................................................................................................
$
34,224 $
32,395
Accounts payable and accrued liabilities ...............................................................................
34,337
31,958
Short-term borrowings and current maturities of long-term debt ..........................................
4,545
4,274
Unearned revenues .................................................................................................................
3,317
3,355
Other current liabilities ...........................................................................................................
27,346
27,072
Total current liabilities ..................................................................................................................
103,769
99,054
Long-term debt, less current maturities .........................................................................................
72,359
58,263
Deferred income taxes ...................................................................................................................
3,620
3,021
Other liabilities ..............................................................................................................................
15,939
14,463
Total liabilities ...............................................................................................................................
195,687
174,801
Commitments and contingencies (Note 12)
Redeemable noncontrolling interests ............................................................................................
4,323
4,498
Equity:
Preferred stock, $0.001 par value - 10 shares authorized; no shares issued or outstanding ..
—
—
Common stock, $0.01 par value - 3,000 shares authorized; 915 and 924 issued and
outstanding ........................................................................................................................
9
9
Retained earnings ...................................................................................................................
96,036
95,774
Accumulated other comprehensive loss .................................................................................
(3,387)
(7,027)
Nonredeemable noncontrolling interests ................................................................................
5,610
5,665
Total equity ....................................................................................................................................
98,268
94,421
Total liabilities, redeemable noncontrolling interests and equity ...........................................
$
298,278 $
273,720
See Notes to the Consolidated Financial Statements
40
UnitedHealth Group
Consolidated Statements of Operations
For the Years Ended December 31,
(in millions, except per share data)
2024
2023
2022
Revenues:
Premiums ..............................................................................................................
$ 308,810 $ 290,827 $ 257,157
Products ................................................................................................................
50,226
42,583
37,424
Services .................................................................................................................
36,040
34,123
27,551
Investment and other income ................................................................................
5,202
4,089
2,030
Total revenues ..............................................................................................................
400,278
371,622
324,162
Operating costs:
Medical costs ........................................................................................................
264,185
241,894
210,842
Operating costs .....................................................................................................
53,013
54,628
47,782
Cost of products sold ............................................................................................
46,694
38,770
33,703
Depreciation and amortization ..............................................................................
4,099
3,972
3,400
Total operating costs ....................................................................................................
367,991
339,264
295,727
Earnings from operations .........................................................................................
32,287
32,358
28,435
Interest expense ...........................................................................................................
(3,906)
(3,246)
(2,092)
Loss on sale of subsidiary and subsidiaries held for sale ............................................
(8,310)
—
—
Earnings before income taxes ...................................................................................
20,071
29,112
26,343
Provision for income taxes ..........................................................................................
(4,829)
(5,968)
(5,704)
Net earnings ................................................................................................................
15,242
23,144
20,639
Earnings attributable to noncontrolling interests .........................................................
(837)
(763)
(519)
Net earnings attributable to UnitedHealth Group common shareholders ...........
$
14,405 $
22,381 $
20,120
Earnings per share attributable to UnitedHealth Group common
shareholders:
Basic ......................................................................................................................
$
15.64 $
24.12 $
21.47
Diluted ...................................................................................................................
$
15.51 $
23.86 $
21.18
Basic weighted-average number of common shares outstanding ..........................
921
928
937
Dilutive effect of common share equivalents ...........................................................
8
10
13
Diluted weighted-average number of common shares outstanding ......................
929
938
950
Anti-dilutive shares excluded from the calculation of dilutive effect of common
share equivalents ......................................................................................................
6
6
3
See Notes to the Consolidated Financial Statements
41
UnitedHealth Group
Consolidated Statements of Comprehensive Income
For the Years Ended December 31,
(in millions)
2024
2023
2022
Net earnings ..........................................................................................................
$
15,242 $
23,144 $
20,639
Other comprehensive income (loss):
Gross unrealized gains (losses) on investment securities during the period ...
29
1,139
(4,292)
Income tax effect .............................................................................................
(7)
(263)
984
Total unrealized gains (losses), net of tax ..................................................
22
876
(3,308)
Gross reclassification adjustment for net realized (gains) losses included in
net earnings ..................................................................................................
(369)
(90)
139
Income tax effect .............................................................................................
92
21
(32)
Total reclassification adjustment, net of tax ...............................................
(277)
(69)
107
Foreign currency translation (losses) gains ......................................................
(319)
559
192
Reclassification adjustment for translation losses included in net earnings ....
4,214
—
—
Total foreign currency translation gains ...................................................
3,895
559
192
Other comprehensive income (loss) .....................................................................
3,640
1,366
(3,009)
Comprehensive income ..........................................................................................
18,882
24,510
17,630
Comprehensive income attributable to noncontrolling interests ............................
(837)
(763)
(519)
Comprehensive income attributable to UnitedHealth Group common
shareholders ......................................................................................................
$
18,045 $
23,747 $
17,111
See Notes to the Consolidated Financial Statements
42
UnitedHealth Group
Consolidated Statements of Changes in Equity
Common Stock
Additional
Paid-In
Capital
Retained
Earnings
Accumulated Other
Comprehensive Income
(Loss)
Nonredeemable
Noncontrolling
Interests
Total
Equity
(in millions, except per share data)
Shares
Amount
Net
Unrealized
Gains
(Losses) on
Investments
Foreign
Currency
Translation
(Losses)
Gains
Balance at January 1, 2022 .....................
941
$
10
$
—
$ 77,134
$
423
$
(5,807) $
3,285
$
75,045
Net earnings ...........................................
20,120
406
20,526
Other comprehensive (loss) income .......
(3,201)
192
(3,009)
Issuances of common stock, and related
tax effects ...........................................
7
—
903
903
Share-based compensation ......................
875
875
Common share repurchases ....................
(14)
(1)
(1,892)
(5,107)
(7,000)
Cash dividends paid on common shares
($6.40 per share) .................................
(5,991)
(5,991)
Redeemable noncontrolling interests
fair value and other adjustments .........
114
114
Acquisition and other adjustments of
nonredeemable noncontrolling
interests ...............................................
374
374
Distributions to nonredeemable
noncontrolling interests ......................
(387)
(387)
Balance at December 31, 2022 ...............
934
9
—
86,156
(2,778)
(5,615)
3,678
81,450
Net earnings ...........................................
22,381
575
22,956
Other comprehensive income .................
807
559
1,366
Issuances of common stock, and related
tax effects ...........................................
6
—
1,231
1,231
Share-based compensation ......................
1,027
1,027
Common share repurchases ....................
(16)
—
(2,057)
(6,002)
(8,059)
Cash dividends paid on common shares
($7.29 per share) .................................
(6,761)
(6,761)
Redeemable noncontrolling interests
fair value and other adjustments .........
(201)
(201)
Acquisition and other adjustments of
nonredeemable noncontrolling
interests ..............................................
1,928
1,928
Distributions to nonredeemable
noncontrolling interests ......................
(516)
(516)
Balance at December 31, 2023 ...............
924
9
—
95,774
(1,971)
(5,056)
5,665
94,421
Net earnings ...........................................
14,405
663
15,068
Other comprehensive (loss) income .......
(255)
3,895
3,640
Issuances of common stock, and related
tax effects ...........................................
8
—
1,485
1,485
Share-based compensation ......................
963
963
Common share repurchases ....................
(17)
—
(2,395)
(6,610)
(9,005)
Cash dividends paid on common shares
($8.18 per share) .................................
(7,533)
(7,533)
Redeemable noncontrolling interests
fair value and other adjustments .........
(53)
(53)
Acquisition and other adjustments of
nonredeemable noncontrolling
interests ..............................................
26
26
Distributions to nonredeemable
noncontrolling interests ......................
(744)
(744)
Balance at December 31, 2024 ...............
915
$
9
$
—
$ 96,036
$
(2,226) $
(1,161) $
5,610
$
98,268
See Notes to the Consolidated Financial Statements
43
UnitedHealth Group
Consolidated Statements of Cash Flows
For the Years Ended December 31,
(in millions)
2024
2023
2022
Operating activities
Net earnings ....................................................................................................................................................
$
15,242
$
23,144
$
20,639
Noncash items:
Depreciation and amortization ...............................................................................................................
4,099
3,972
3,400
Deferred income taxes ...........................................................................................................................
(296)
(245)
(673)
Share-based compensation.....................................................................................................................
1,018
1,059
925
Loss on sale of subsidiary and subsidiaries held for sale ......................................................................
8,310
—
—
Gains on dispositions and other strategic transactions ..........................................................................
(3,333)
(489)
(588)
Other, net ...............................................................................................................................................
(28)
(16)
257
Net change in other operating items, net of effects from acquisitions and dispositions:
Accounts receivable ...............................................................................................................................
(1,437)
(3,114)
(2,523)
Other assets ............................................................................................................................................
(4,140)
(2,444)
(1,374)
Medical costs payable ............................................................................................................................
2,503
3,482
4,053
Accounts payable and other liabilities ...................................................................................................
2,463
3,516
1,964
Unearned revenues ................................................................................................................................
(197)
203
126
Cash flows from operating activities ..............................................................................................................
24,204
29,068
26,206
Investing activities
Purchases of investments ................................................................................................................................
(27,308)
(18,314)
(18,825)
Sales of investments .......................................................................................................................................
18,514
7,307
5,907
Maturities of investments ...............................................................................................................................
9,319
9,230
6,081
Cash paid for acquisitions and other transactions, net of cash assumed ........................................................
(13,408)
(10,136)
(21,458)
Purchases of property, equipment and capitalized software ...........................................................................
(3,499)
(3,386)
(2,802)
Loans to care providers - cyberattack .............................................................................................................
(9,033)
—
—
Repayments of care provider loans - cyberattack ...........................................................................................
4,514
—
—
Cash received from dispositions and other strategic transactions, net ...........................................................
2,041
685
3,414
Other, net ........................................................................................................................................................
(1,667)
(960)
(793)
Cash flows used for investing activities .........................................................................................................
(20,527)
(15,574)
(28,476)
Financing activities
Common share repurchases ............................................................................................................................
(9,000)
(8,000)
(7,000)
Cash dividends paid ........................................................................................................................................
(7,533)
(6,761)
(5,991)
Proceeds from common stock issuances .........................................................................................................
1,846
1,353
1,253
Repayments of long-term debt........................................................................................................................
(3,000)
(2,125)
(3,015)
(Repayments of) proceeds from short-term borrowings, net ..........................................................................
(151)
11
732
Proceeds from issuance of long-term debt ......................................................................................................
17,811
6,394
14,819
Customer funds administered .........................................................................................................................
(1,560)
(521)
5,548
Purchases of redeemable noncontrolling interests ..........................................................................................
(280)
(730)
(176)
Other, net ........................................................................................................................................................
(1,645)
(1,150)
(1,944)
Cash flows (used for) from financing activities .............................................................................................
(3,512)
(11,529)
4,226
Effect of exchange rate changes on cash and cash equivalents ......................................................................
(61)
97
34
Increase in cash and cash equivalents, including cash within businesses held for sale ..........................
104
2,062
1,990
Less: cash within businesses held for sale ......................................................................................................
(219)
—
—
Net (decrease) increase in cash and cash equivalents .....................................................................................
(115)
2,062
1,990
Cash and cash equivalents, beginning of period ........................................................................................
25,427
23,365
21,375
Cash and cash equivalents, end of period ...................................................................................................
$
25,312
$
25,427
$
23,365
Supplemental cash flow disclosures
Cash paid for interest ......................................................................................................................................
$
3,594
$
3,035
$
1,945
Cash paid for income taxes .............................................................................................................................
4,620
6,078
5,222
See Notes to the Consolidated Financial Statements
44
UnitedHealth Group
Notes to the Consolidated Financial Statements
1.
Description of Business
UnitedHealth Group Incorporated (individually and together with its subsidiaries, “UnitedHealth Group” and “the Company”)
is a health care and well-being company with a mission to help people live healthier lives and help make the health system work
better for everyone. The Company’s two distinct, yet complementary businesses — Optum and UnitedHealthcare — are
working to help build a modern, high-performing health system through improved access, affordability, outcomes and
experiences for the individuals and organizations the Company is privileged to serve.
2.
Basis of Presentation, Use of Estimates and Significant Accounting Policies
Basis of Presentation
The Company has prepared the Consolidated Financial Statements according to U.S. Generally Accepted Accounting Principles
(GAAP) and has included the accounts of UnitedHealth Group and its subsidiaries.
Use of Estimates
These Consolidated Financial Statements include certain amounts based on the Company’s best estimates and judgments. The
Company’s most significant estimates relate to estimates and judgments for medical costs payable and goodwill. Certain of
these estimates require the application of complex assumptions and judgments, often because they involve matters inherently
uncertain and will likely change in subsequent periods. The impact of any change in estimates is included in earnings in the
period in which the estimate is adjusted.
Revenues
Premiums
Premium revenues are primarily derived from risk-based arrangements in which the premium is typically at a fixed rate per
individual served for a one-year period, and the Company assumes the economic risk of funding its customers’ health care and
related administrative costs.
Premium revenues are recognized in the period in which eligible individuals are entitled to receive health care benefits. Health
care premium payments received from the Company’s customers in advance of the service period are recorded as unearned
revenues. Fully insured commercial products of U.S. health plans, Medicare Advantage and Medicare Prescription Drug
Benefit (Medicare Part D) plans with medical loss ratios (MLRs) as calculated under the definitions in the Patient Protection
and Affordable Care Act (ACA) and related federal and state regulations and implementing regulation, falling below certain
targets are required to rebate ratable portions of their premiums annually. Commercial premiums within the Company’s
individual and small group markets are also subject to the ACA risk adjustment program. Medicare Advantage premium
revenue includes the impact of the Centers for Medicare & Medicaid Services (CMS) quality bonuses based on plans’ Star
rating. Certain of the Company’s Medicaid business is also subject to state minimum MLR rebates.
Premium revenues are recognized based on the estimated premiums earned, net of projected rebates, because the Company is
able to reasonably estimate the ultimate premiums of these contracts. The Company also records premium revenues for certain
value-based arrangements at its Optum Health care delivery businesses. Under these value-based arrangements, the Company
enters into agreements with health plans to stand ready to deliver, integrate, direct and control certain health care services for
patients. In exchange, the Company receives a premium that is typically paid on a per-patient per-month basis. The Company
considers these value-based arrangements to represent a single performance obligation where premium revenues are recognized
in the period in which health care services are made available.
The Company’s Medicare Advantage and Medicare Part D premium revenues are subject to periodic adjustment under CMS’
risk adjustment payment methodology. CMS deploys a risk adjustment model which apportions premiums paid to all health
plans according to health severity and certain demographic factors. The CMS risk adjustment model provides higher per
member payments for enrollees diagnosed with certain conditions and lower payments for enrollees who are healthier. Under
this risk adjustment methodology, CMS calculates the risk adjusted premium payment using diagnosis and encounter data from
hospital inpatient, hospital outpatient and physician treatment settings. The Company and health care providers collect, capture
and submit the necessary and available data to CMS within prescribed deadlines. The Company estimates risk adjustment
premium revenues based upon the data submitted and expected to be submitted to CMS. Risk adjustment data for the
Company’s plans are subject to review by the government, including audit by regulators. See Note 12 for additional information
regarding these audits.
45
Products and Services
For the Company’s Optum Rx pharmacy care services business, the majority of revenues are derived from products sold
through a contracted network of retail pharmacies or home delivery, specialty and community health pharmacies. Product
revenues include the cost of pharmaceuticals (net of rebates), a negotiated dispensing fee and customer co-payments. Pharmacy
products are billed to customers based on the number of transactions occurring during the billing period. Product revenues are
recognized when the prescriptions are dispensed. The Company has entered into contracts in which it is primarily obligated to
pay its network pharmacy providers for benefits provided to their customers regardless of whether the Company is paid. The
Company is also involved in establishing the prices charged by retail pharmacies, determining which drugs will be included in
formulary listings and selecting which retail pharmacies will be included in the network offered to plan sponsors’ members and
accordingly, product revenues are reported on a gross basis.
Services revenue includes a number of services and products sold through Optum. Optum Health’s service revenues include net
patient service revenues recorded based upon established billing rates, less allowances for contractual adjustments, and are
recognized as services are provided. For its financial services offerings, Optum Health charges fees and earns investment
income on managed funds. Optum Insight provides software and information products, advisory consulting arrangements and
managed services outsourcing contracts, which may be delivered over several years. Optum Insight revenues are generally
recognized over time and measured for each period based on the progress to date as services are performed or made available to
customers.
Services revenue also consists of fees derived from services performed for customers who self-insure the health care costs of
their employees and employees’ dependents. Under service fee contracts, the Company receives a monthly fixed fee per
employee, which is recognized as revenue as the Company performs, or makes available, the applicable services to the
customer. The customers retain the risk of financing health care costs for their employees and employees’ dependents, and the
Company administers the payment of customer funds to physicians and other health care professionals from customer-funded
bank accounts. As the Company has neither the obligation for funding the health care costs, nor the primary responsibility for
providing the medical care, the Company does not recognize premium revenue and medical costs for these contracts in its
Consolidated Financial Statements. For these fee-based customer arrangements, the Company provides coordination and
facilitation of medical services; transaction processing; customer, consumer and care professional services; and access to
contracted networks of physicians, hospitals and other health care professionals. These services are performed throughout the
contract period.
As of December 31, 2024 and 2023, accounts receivables related to products and services were $9.9 billion and $8.6 billion,
respectively. In 2024 and 2023, the Company had no material bad-debt expense and there were no material contract assets,
contract liabilities or deferred contract costs recorded on the Consolidated Balance Sheets as of December 31, 2024 or 2023.
For the years ended December 31, 2024, 2023 and 2022, revenue recognized from performance obligations related to prior
periods (for example, due to changes in transaction price) was not material.
As of December 31, 2024, revenue expected to be recognized in any future year related to remaining performance obligations,
excluding revenue pertaining to contracts having an original expected duration of one year or less, contracts where revenue is
recognized as invoiced and contracts with variable consideration related to undelivered performance obligations, was $12.7
billion, of which approximately half is expected to be recognized in the next three years.
See Note 14 for disaggregation of revenue by segment and type.
Medical Costs and Medical Costs Payable
The Company’s estimate of medical costs payable represents management’s best estimate of its liability for unpaid medical
costs as of December 31, 2024.
Each period, the Company re-examines previously established medical costs payable estimates based on actual claim
submissions and other changes in facts and circumstances. As more complete claim information becomes available, the
Company adjusts the amount of the estimates and includes the changes in estimates in medical costs in the period in which the
change is identified. Approximately 90% of claims related to medical care services are known and settled within 90 days from
the date of service and substantially all within twelve months.
Medical costs and medical costs payable include estimates of the Company’s obligations for medical care services rendered on
behalf of consumers, but for which claims have either not yet been received, processed, or paid. The Company develops
estimates for medical care services incurred but not reported (IBNR), which includes estimates for claims which have not been
received or fully processed, using an actuarial process consistently applied, centrally controlled and automated. The actuarial
models consider factors such as time from date of service to claim processing, seasonal variances in medical care consumption,
health care professional contract rate changes, care activity and other medical cost trends, membership volume and
46
demographics, the introduction of new technologies, benefit plan changes and business mix changes related to products,
customers and geography.
In developing its medical costs payable estimates, the Company applies different estimation methods depending on which
incurred claims are being estimated. For the most recent two months, the Company estimates claim costs incurred by applying
observed medical cost trend factors to the average per member per month medical costs incurred in prior months for which
more complete claim data are available, supplemented by a review of near-term completion factors (actuarial estimates, based
upon historical experience and analysis of current trends, of the percentage of incurred claims during a given period adjudicated
by the Company at the date of estimation). For months prior to the most recent two months, the Company applies the
completion factors to actual claims adjudicated-to-date to estimate the expected amount of ultimate incurred claims for those
months.
Cost of Products Sold
The Company’s cost of products sold includes the cost of pharmaceuticals dispensed to unaffiliated customers either directly at
its home delivery, specialty and community pharmacy locations, or indirectly through its nationwide network of participating
pharmacies. Rebates attributable to unaffiliated clients are accrued as rebates receivable and a reduction of cost of products
sold, with a corresponding payable for the amounts of the rebates to be remitted to those unaffiliated clients in accordance with
their contracts and recorded in the Consolidated Statements of Operations as a reduction of product revenue. Cost of products
sold also includes the cost of personnel to support the Company’s transaction processing services, system sales, maintenance
and professional services.
Cash, Cash Equivalents and Investments
Cash and cash equivalents are highly liquid investments having an original maturity of three months or less. The fair value of
cash and cash equivalents approximates their carrying value because of the short maturity of the instruments. Investments with
maturities of less than one year are classified as short-term. Because of regulatory requirements, certain investments are
included in long-term investments regardless of their maturity date. The Company classifies these investments as held-to-
maturity and reports them at amortized cost. Substantially all other investments are classified as available-for-sale and reported
at fair value based on quoted market prices, where available. Equity investments are measured at fair value, with certain
exceptions where the Company has elected to measure investments with unobservable inputs at cost, subject to fair value
adjustments upon an impairment or a transaction of the same or similar security. Changes in fair value of equity investments are
recognized in net earnings.
The Company excludes unrealized gains and losses on available-for-sale debt securities from net earnings and reports them as
comprehensive income and, net of income tax effects, as a separate component of equity. To calculate realized gains and losses
on the sale of debt securities, the Company specifically identifies the cost of each investment sold.
The Company evaluates an available-for-sale debt security for credit-related impairment by considering the present value of
expected cash flows relative to a security’s amortized cost, the extent to which fair value is less than amortized cost, the
financial condition and near-term prospects of the issuer and specific events or circumstances which may influence the
operations of the issuer. Credit-related impairments are recorded as an allowance, with an offset to investment and other
income. Non-credit related impairments are recorded through other comprehensive income. If the Company intends to sell an
impaired security, or will likely be required to sell a security before recovery of the entire amortized cost, the entire impairment
is included in net earnings.
New information and the passage of time can change these judgments. The Company manages its investment portfolio to limit
its exposure to any one issuer or market sector, and largely limits its investments to investment grade quality.
Assets Under Management
In July 2024, the Company amended its Medicare Supplement Program with a membership organization (the Medicare
Supplement Program). The amendments provide the Company the right to use a trade name and other intellectual property in
marketing efforts for Medicare Supplement offerings. Amounts previously reported as assets under management are now
included within the Company’s Consolidated Balance Sheet based upon their classification.
For periods prior to the amended Medicare Supplement Program, the Company excluded the effects of certain balance sheet
amounts in its Consolidated Statements of Cash Flows, while these effects are included for periods after the amendments.
Other Current Receivables
Other current receivables include amounts due from pharmaceutical manufacturers for rebates and Medicare Part D drug
discounts, loans to care providers in response to the Change Healthcare cyberattack, accrued interest and other miscellaneous
amounts due to the Company.
47
The Company’s pharmacy care services businesses contract with pharmaceutical manufacturers, some of which provide rebates
based on use of the manufacturers’ products by its affiliated and unaffiliated clients. The Company accrues rebates as they are
earned by its clients on a monthly basis based on the terms of the applicable contracts, historical data and current estimates. The
pharmacy care services businesses bill these rebates to the manufacturers on a monthly or quarterly basis depending on the
contractual terms and record rebates attributable to affiliated clients as a reduction to medical costs. The Company generally
receives rebates two to five months after billing. As of December 31, 2024 and 2023, total pharmaceutical manufacturer rebates
receivable included in other receivables in the Consolidated Balance Sheets amounted to $12.5 billion and $11.0 billion,
respectively.
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets included pharmaceutical drug and supplies inventory of $3.8 billion and $2.8 billion
as of December 31, 2024 and 2023, respectively.
Property, Equipment and Capitalized Software
Property, equipment and capitalized software are stated at cost, net of accumulated depreciation and amortization. Capitalized
software consists of certain costs incurred in the development of internal-use software, including external direct costs of
materials and services and applicable payroll costs of employees devoted to specific software development.
The Company calculates depreciation and amortization using the straight-line method over the estimated useful lives of the
assets. The useful lives for property, equipment and capitalized software are:
Furniture, fixtures and equipment ..........................................................................................................................
3 to 10 years
Buildings ................................................................................................................................................................
35 to 40 years
Capitalized software ..............................................................................................................................................
3 to 5 years
Leasehold improvements are depreciated over the shorter of the remaining lease term or their estimated useful economic life.
Operating Leases
The Company leases facilities and equipment under long-term operating leases which are non-cancelable and expire on various
dates. At the lease commencement date, lease right-of-use (ROU) assets and lease liabilities are recognized based on the present
value of the future minimum lease payments over the lease term, which includes all fixed obligations arising from the lease
contract. If an interest rate is not implicit in a lease, the Company utilizes its incremental borrowing rate for a period closely
matching the lease term.
The Company’s ROU assets are included in other assets, and lease liabilities are included in other current liabilities and other
liabilities in the Company’s Consolidated Balance Sheet.
Goodwill
To determine whether goodwill is impaired, annually or more frequently if needed, the Company performs impairment tests.
The Company may first assess qualitative factors to determine if it is more likely than not the carrying value of a reporting unit
exceeds its estimated fair value. If our qualitative assessment indicates a goodwill impairment is more likely than not, we
perform additional quantitative analyses. The Company may also elect to skip the qualitative testing and proceed directly to the
quantitative testing. When performing quantitative testing, the Company first estimates the fair values of its reporting units
using discounted cash flows. To determine fair values, the Company must make assumptions about a wide variety of internal
and external factors. Significant assumptions used in the impairment analysis include financial projections of free cash flow
(including significant assumptions about operations, capital levels and income taxes), long-term growth rates for determining
terminal value and discount rates. Comparative market multiples are used to corroborate the results of the discounted cash flow
test. If the fair value is less than the carrying value of the reporting unit, an impairment is recognized for the difference, up to
the carrying amount of goodwill.
There was no impairment of goodwill during the years ended December 31, 2024, 2023 and 2022.
Intangible Assets
The Company’s finite-lived intangible assets are subject to impairment tests when events or circumstances indicate an
intangible asset (or asset group) may be impaired. The Company’s indefinite-lived intangible assets are also tested for
impairment annually. There was no impairment of intangible assets during the years ended December 31, 2024, 2023 and 2022.
Other Current Liabilities
Other current liabilities include health savings account deposits ($13.7 billion and $13.5 billion as of December 31, 2024 and
2023, respectively), accruals for premium rebates payable, the current portion of future policy benefits and customer balances.
48
Policy Acquisition Costs
The Company’s short duration health insurance contracts typically have a one-year term and may be canceled by the customer
with at least 30 days’ notice. Costs related to the acquisition and renewal of short duration customer contracts are primarily
charged to expense as incurred.
Redeemable Noncontrolling Interests
Redeemable noncontrolling interests in the Company’s subsidiaries whose redemption is outside of the Company’s control are
classified as temporary equity. These interests primarily relate to put options on unowned shares, which are typically
redeemable at fair value after a certain time period. The Company accretes changes in the redemption value to the earliest
redemption date utilizing the interest method. If all interests were currently redeemable, the difference between the carrying
value and the estimated redemption value is not material. The following table provides details of the Company's redeemable
noncontrolling interests’ activity for the years ended December 31, 2024 and 2023:
(in millions)
2024
2023
Redeemable noncontrolling interests, beginning of period ..............................................................
$
4,498 $
4,897
Net earnings ......................................................................................................................................
174
188
Acquisitions ......................................................................................................................................
33
122
Redemptions .....................................................................................................................................
(280)
(730)
Distributions ....................................................................................................................................
(125)
(144)
Fair value and other adjustments ......................................................................................................
23
165
Redeemable noncontrolling interests, end of period ........................................................................
$
4,323 $
4,498
Share-Based Compensation
The Company recognizes compensation expense for share-based awards, including stock options and restricted stock and
restricted stock units (collectively, restricted shares), on a straight-line basis over the related service period (generally the
vesting period) of the award, or to an employee’s eligible retirement date under the award agreement, if earlier. Restricted
shares vest ratably, primarily over four years, and compensation expense related to restricted shares is based on the share price
on the date of grant. Stock options vest ratably primarily over four years and may be exercised up to 10 years from the date of
grant. Compensation expense related to stock options is based on the fair value at the date of grant, which is estimated on the
date of grant using a binomial option-pricing model. Under the Company’s Employee Stock Purchase Plan (ESPP), eligible
employees are allowed to purchase the Company’s stock at a discounted price, which is 90% of the market price of the
Company’s common stock at the end of the six-month purchase period. Share-based compensation expense for all programs is
recognized in operating costs in the Consolidated Statements of Operations.
Net Earnings Per Common Share
The Company computes basic earnings per common share attributable to UnitedHealth Group common shareholders by
dividing net earnings attributable to UnitedHealth Group common shareholders by the weighted-average number of common
shares outstanding during the period. The Company determines diluted net earnings per common share attributable to
UnitedHealth Group common shareholders using the weighted-average number of common shares outstanding during the
period, adjusted for potentially dilutive shares associated with stock options, restricted shares and the ESPP (collectively,
common stock equivalents), using the treasury stock method. The treasury stock method assumes a hypothetical issuance of
shares to settle the share-based awards, with the assumed proceeds used to purchase common stock at the average market price
for the period. Assumed proceeds include the amount the employee must pay upon exercise and the average unrecognized
compensation cost. The difference between the number of shares assumed issued and number of shares assumed purchased
represents the dilutive shares.
49
3.
Investments
A summary of debt securities by major security type is as follows:
(in millions)
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
December 31, 2024
Debt securities - available-for-sale:
U.S. government and agency obligations ....................
$
4,600 $
1 $
(274) $
4,327
State and municipal obligations ..................................
7,357
2
(375)
6,984
Corporate obligations ..................................................
24,391
56
(1,140)
23,307
U.S. agency mortgage-backed securities ....................
10,577
1
(994)
9,584
Non-U.S. agency mortgage-backed securities ............
2,890
2
(175)
2,717
Total debt securities - available-for-sale ............................
49,815
62
(2,958)
46,919
Debt securities - held-to-maturity:
U.S. government and agency obligations ....................
444
—
(2)
442
State and municipal obligations ..................................
28
—
(2)
26
Corporate obligations ..................................................
40
—
—
40
Total debt securities - held-to-maturity ...............................
512
—
(4)
508
Total debt securities ............................................................
$
50,327 $
62 $
(2,962) $
47,427
December 31, 2023
Debt securities - available-for-sale:
U.S. government and agency obligations ....................
$
4,674 $
3 $
(234) $
4,443
State and municipal obligations ..................................
7,636
39
(322)
7,353
Corporate obligations ..................................................
23,136
67
(1,186)
22,017
U.S. agency mortgage-backed securities ....................
8,982
22
(708)
8,296
Non-U.S. agency mortgage-backed securities ............
3,023
3
(240)
2,786
Total debt securities - available-for-sale ............................
47,451
134
(2,690)
44,895
Debt securities - held-to-maturity:
U.S. government and agency obligations ....................
506
1
(6)
501
State and municipal obligations ..................................
28
—
(2)
26
Corporate obligations ..................................................
69
—
—
69
Total debt securities - held-to-maturity ..............................
603
1
(8)
596
Total debt securities ............................................................
$
48,054 $
135 $
(2,698) $
45,491
Nearly all of the Company’s investments in mortgage-backed securities were rated “Double A” or better as of December 31,
2024.
The Company held $4.9 billion of equity securities as of December 31, 2024 and 2023. The Company’s investments in equity
securities primarily consist of venture investments and employee savings plan related investments. Additionally, the Company’s
investments included $3.8 billion and $1.4 billion of equity method investments primarily in operating businesses in the health
care sector, as of December 31, 2024 and 2023, respectively. The allowance for credit losses on held-to-maturity securities as of
December 31, 2024 and 2023 was not material.
50
The amortized cost and fair value of debt securities as of December 31, 2024, by contractual maturity, were as follows:
Available-for-Sale
Held-to-Maturity
(in millions)
Amortized
Cost
Fair
Value
Amortized
Cost
Fair
Value
Due in one year or less .........................................................................................
$ 3,952 $ 3,932 $
320 $
319
Due after one year through five years ..................................................................
14,845 14,384
161
161
Due after five years through ten years .................................................................
12,110 11,213
14
13
Due after ten years ................................................................................................
5,441
5,089
17
15
U.S. agency mortgage-backed securities ..............................................................
10,577
9,584
—
—
Non-U.S. agency mortgage-backed securities .....................................................
2,890
2,717
—
—
Total debt securities .............................................................................................
$ 49,815 $ 46,919 $
512 $
508
The fair value of available-for-sale debt securities with gross unrealized losses by major security type and length of time that
individual securities have been in a continuous unrealized loss position were as follows:
Less Than 12 Months
12 Months or Greater
Total
(in millions)
Fair
Value
Gross
Unrealized
Losses
Fair
Value
Gross
Unrealized
Losses
Fair
Value
Gross
Unrealized
Losses
December 31, 2024
U.S. government and agency obligations ........
$
1,475 $
(51) $
2,152 $
(223) $
3,627 $
(274)
State and municipal obligations ......................
2,593
(58)
4,085
(317)
6,678
(375)
Corporate obligations ......................................
7,402
(213)
11,449
(927)
18,851
(1,140)
U.S. agency mortgage-backed securities ........
4,791
(191)
4,674
(803)
9,465
(994)
Non-U.S. agency mortgage-backed securities
416
(5)
1,863
(170)
2,279
(175)
Total debt securities - available-for-sale .........
$
16,677 $
(518) $
24,223 $
(2,440) $
40,900 $
(2,958)
December 31, 2023
U.S. government and agency obligations ........
$
1,270 $
(7) $
2,077 $
(227) $
3,347 $
(234)
State and municipal obligations ......................
907
(7)
4,063
(315)
4,970
(322)
Corporate obligations ......................................
1,826
(17)
14,696
(1,169)
16,522
(1,186)
U.S. agency mortgage-backed securities ........
1,337
(12)
5,069
(696)
6,406
(708)
Non-U.S. agency mortgage-backed securities
279
(6)
2,202
(234)
2,481
(240)
Total debt securities - available-for-sale .........
$
5,619 $
(49) $
28,107 $
(2,641) $
33,726 $
(2,690)
The Company’s unrealized losses from all securities as of December 31, 2024 were generated from approximately 34,000
positions out of a total of 43,000 positions. The Company believes it will timely collect the principal and interest due on its debt
securities that have an amortized cost in excess of fair value. The unrealized losses were primarily caused by interest rate
increases and not by unfavorable changes in the credit quality associated with these securities which impacted the Company’s
assessment on collectibility of principal and interest. At each reporting period, the Company evaluates available-for-sale debt
securities for any credit-related impairment when the fair value of the investment is less than its amortized cost. The Company
evaluated the expected cash flows, the underlying credit quality and credit ratings of the issuers, noting no significant credit
deterioration since purchase. As of December 31, 2024, the Company did not have the intent to sell any of the securities in an
unrealized loss position. Therefore, the Company believes these losses to be temporary. The allowance for credit losses on
available-for-sale debt securities as of December 31, 2024 and 2023 was not material.
4.
Fair Value
Certain assets and liabilities are measured at fair value in the Consolidated Financial Statements or have fair values disclosed in
the Notes to the Consolidated Financial Statements. These assets and liabilities are classified into one of three levels of a
hierarchy defined by GAAP. In instances in which the inputs used to measure fair value fall into different levels of the fair
value hierarchy, the fair value measurement is categorized in its entirety based on the lowest level input which is significant to
the fair value measurement in its entirety. The Company’s assessment of the significance of a particular item to the fair value
measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.
51
The fair value hierarchy is summarized as follows:
Level 1 — Quoted prices (unadjusted) for identical assets/liabilities in active markets.
Level 2 — Other observable inputs, either directly or indirectly, including:
•
Quoted prices for similar assets/liabilities in active markets;
•
Quoted prices for identical or similar assets/liabilities in inactive markets (e.g., few transactions, limited
information, noncurrent prices, high variability over time);
•
Inputs other than quoted prices observable for the asset/liability (e.g., interest rates, yield curves, implied
volatilities, credit spreads); and
•
Inputs corroborated by other observable market data.
Level 3 — Unobservable inputs cannot be corroborated by observable market data.
There were no transfers in or out of Level 3 financial assets or liabilities during the years ended December 31, 2024 or 2023.
Nonfinancial assets and liabilities or financial assets and liabilities measured at fair value on a nonrecurring basis are subject to
fair value adjustments only in certain circumstances, such as when the Company records an impairment. For the years ended
December 31, 2024, 2023 and 2022, the Company recognized $710 million, $276 million and $211 million respectively, of
unrealized gains in investment and other income related to fair value adjustments on equity securities primarily in the
Company’s venture portfolio, based upon transactions of the same or similar security. The assets and liabilities within our South
American operations held for sale as of December 31, 2024 were measured at the lower of carrying value or fair value less cost
to sell. Fair value is measured based upon unobservable amounts, such as estimated selling price derived from Company-
specific information and market conditions. There were no other significant fair value adjustments for these assets and liabilities
recorded during the years ended December 31, 2024, 2023 or 2022.
The following methods and assumptions were used to estimate the fair value and determine the fair value hierarchy
classification of each class of financial instrument included in the tables below:
Cash and Cash Equivalents. The carrying value of cash and cash equivalents approximates fair value as maturities are less than
three months. Fair values of cash equivalent instruments which do not trade on a regular basis in active markets are classified as
Level 2.
Debt and Equity Securities. Fair values of debt securities and equity securities reported at fair value on a recurring basis are
based on quoted market prices, where available. The Company obtains one price for each security primarily from a third-party
pricing service (pricing service), which generally uses quoted or other observable inputs for the determination of fair value. The
pricing service normally derives the security prices through recently reported trades for identical or similar securities, and, if
necessary, makes adjustments through the reporting date based upon available observable market information. For securities not
actively traded, the pricing service may use quoted market prices of comparable instruments or discounted cash flow analyses,
incorporating inputs currently observable in the markets for similar securities. Inputs often used in the valuation methodologies
include, but are not limited to, benchmark yields, credit spreads, default rates, prepayment speeds and nonbinding broker
quotes. As the Company is responsible for the determination of fair value, it performs quarterly analyses on the prices received
from the pricing service to determine whether the prices are reasonable estimates of fair value. Specifically, the Company
compares the prices received from the pricing service to prices reported by a secondary pricing source, such as its custodian, its
investment consultant and third-party investment advisors. Additionally, the Company compares changes in the reported market
values and returns to relevant market indices to test the reasonableness of the reported prices. The Company’s internal price
verification procedures and reviews of fair value methodology documentation provided by independent pricing services have
not historically resulted in adjustment to the prices obtained from the pricing service.
Fair values of debt securities which do not trade on a regular basis in active markets but are priced using other observable inputs
are classified as Level 2.
Fair value estimates for Level 1 and Level 2 equity securities reported at fair value on a recurring basis are based on quoted
market prices for actively traded equity securities and/or other market data for the same or comparable instruments and
transactions in establishing the prices.
The fair values of Level 3 investments in corporate bonds, which are not a significant portion of our investments, are estimated
using valuation techniques relying heavily on management assumptions and qualitative observations.
Throughout the procedures discussed above in relation to the Company’s processes for validating third-party pricing
information, the Company validates the understanding of assumptions and inputs used in security pricing and determines the
proper classification in the hierarchy based on such understanding.
52
Long-Term Debt. The fair values of the Company’s long-term debt are estimated and classified using the same methodologies
as the Company’s investments in debt securities.
The following table presents a summary of fair value measurements by level and carrying values for items measured at fair
value on a recurring basis in the Consolidated Balance Sheets:
(in millions)
Quoted Prices
in Active
Markets
(Level 1)
Other
Observable
Inputs
(Level 2)
Unobservable
Inputs
(Level 3)
Total
Fair and
Carrying
Value
December 31, 2024
Cash and cash equivalents ..................................................................
$ 25,248
$
64
$
—
$ 25,312
Debt securities - available-for-sale:
U.S. government and agency obligations ....................................
4,194
133
—
4,327
State and municipal obligations ..................................................
—
6,984
—
6,984
Corporate obligations ..................................................................
29
22,841
437
23,307
U.S. agency mortgage-backed securities ....................................
—
9,584
—
9,584
Non-U.S. agency mortgage-backed securities ............................
—
2,717
—
2,717
Total debt securities - available-for-sale ............................................
4,223
42,259
437
46,919
Equity securities .................................................................................
1,859
24
65
1,948
Total assets at fair value .....................................................................
$ 31,330
$ 42,347
$
502
$ 74,179
Percentage of total assets at fair value ...............................................
42 %
57 %
1 %
100 %
December 31, 2023
Cash and cash equivalents ..................................................................
$ 25,345
$
82
$
—
$ 25,427
Debt securities - available-for-sale:
U.S. government and agency obligations ....................................
4,167
276
—
4,443
State and municipal obligations ..................................................
—
7,353
—
7,353
Corporate obligations ..................................................................
15
21,800
202
22,017
U.S. agency mortgage-backed securities ....................................
—
8,296
—
8,296
Non-U.S. agency mortgage-backed securities ............................
—
2,786
—
2,786
Total debt securities - available-for-sale ............................................
4,182
40,511
202
44,895
Equity securities .................................................................................
2,468
16
69
2,553
Assets under management ..................................................................
1,505
2,140
110
3,755
Total assets at fair value .....................................................................
$ 33,500
$ 42,749
$
381
$ 76,630
Percentage of total assets at fair value ...............................................
44 %
55 %
1 %
100 %
The following table presents a summary of fair value measurements by level and carrying values for certain financial
instruments not measured at fair value on a recurring basis in the Consolidated Balance Sheets:
(in millions)
Quoted Prices
in Active
Markets
(Level 1)
Other
Observable
Inputs
(Level 2)
Unobservable
Inputs
(Level 3)
Total
Fair
Value
Total
Carrying
Value
December 31, 2024
Debt securities - held-to-maturity ...............................
$
482 $
26 $
— $
508 $
512
Long-term debt and other financing obligations ........
$
— $
70,565 $
— $
70,565 $
75,604
December 31, 2023
Debt securities - held-to-maturity ...............................
$
524 $
72 $
— $
596 $
603
Long-term debt and other financing obligations ........
$
— $
59,851 $
— $
59,851 $
61,449
The carrying amounts reported on the Consolidated Balance Sheets for other current financial assets and liabilities approximate
fair value because of their short-term nature. These assets and liabilities are not listed in the table above.
53
5.
Property, Equipment and Capitalized Software
A summary of property, equipment and capitalized software is as follows:
(in millions)
December 31,
2024
December 31,
2023
Land and improvements ..........................................................................................................
$
364 $
712
Buildings and improvements ...................................................................................................
4,215
5,573
Computer equipment ...............................................................................................................
2,267
2,007
Furniture and fixtures ..............................................................................................................
1,694
2,375
Less accumulated depreciation ...............................................................................................
(3,645)
(4,210)
Property and equipment, net ...................................................................................................
4,895
6,457
Capitalized software ................................................................................................................
8,984
7,822
Less accumulated amortization ...............................................................................................
(3,326)
(2,829)
Capitalized software, net .........................................................................................................
5,658
4,993
Total property, equipment and capitalized software, net ........................................................
$
10,553 $
11,450
Depreciation expense for property and equipment for the years ended December 31, 2024, 2023 and 2022 was $1.0 billion, $1.1
billion, and $1.1 billion, respectively. Amortization expense for capitalized software for the years ended December 31, 2024,
2023 and 2022 was $1.4 billion, $1.2 billion and $1.0 billion, respectively.
6.
Goodwill and Other Intangible Assets
Changes in the carrying amount of goodwill, by reportable segment, were as follows:
(in millions)
UnitedHealthcare
Optum Health
Optum Insight
Optum Rx
Consolidated
Balance at January 1, 2023 ........................
$
27,395 $
29,238 $
17,244 $
19,475 $
93,352
Acquisitions ..............................................
296
8,023
1,802
—
10,121
Foreign currency effects and other
adjustments, net .....................................
187
(182)
261
(7)
259
Balance at December 31, 2023 ..................
27,878
37,079
19,307
19,468
103,732
Acquisitions ..............................................
—
2,071
—
2,305
4,376
Dispositions, foreign currency effects and
other adjustments, net ............................
(717)
(324)
(327)
(6)
(1,374)
Balance at December 31, 2024 .................. $
27,161 $
38,826 $
18,980 $
21,767 $
106,734
The gross carrying value, accumulated amortization and net carrying value of other intangible assets were as follows:
December 31, 2024
December 31, 2023
(in millions)
Gross
Carrying
Value
Accumulated
Amortization
Net
Carrying
Value
Gross
Carrying
Value
Accumulated
Amortization
Net
Carrying
Value
Customer-related .....................................................
$ 17,190 $
(6,675) $ 10,515 $ 16,636 $
(5,909) $ 10,727
Trademarks and technology ....................................
2,917
(1,284)
1,633
2,508
(958)
1,550
Trade names, trademarks, operating licenses and
certificates and other indefinite-lived ..................
10,454
— 10,454
2,116
—
2,116
Other .......................................................................
1,057
(391)
666
1,213
(412)
801
Total ........................................................................
$ 31,618 $
(8,350) $ 23,268 $ 22,473 $
(7,279) $ 15,194
54
The fair values and weighted-average useful lives assigned to intangible assets as a result of transactions completed during
years ended:
2024
2023
(in millions, except years)
Fair
Value
Weighted-
Average
Useful Life
Fair
Value
Weighted-
Average
Useful Life
Customer-related .......................................................................................................................
$ 1,258
12 years
$
477
12 years
Trademarks and technology ......................................................................................................
527
6 years
226
5 years
Other ...........................................................................................................................................
22
8 years
44
9 years
Total finite-lived ........................................................................................................................
$ 1,807
10 years
$
747
9 years
Total indefinite-lived - trade names, trademarks, operating licenses and certificates and
other .......................................................................................................................................
8,795
1,427
Total intangible assets ...............................................................................................................
$ 10,602
$ 2,174
Estimated full year amortization expense relating to intangible assets for each of the next five years ending December 31 is as
follows:
(in millions)
2025 .................................................................................................................................................................................
$ 1,655
2026 .................................................................................................................................................................................
1,503
2027 .................................................................................................................................................................................
1,424
2028 .................................................................................................................................................................................
1,344
2029 .................................................................................................................................................................................
1,211
Amortization expense relating to intangible assets for the years ended December 31, 2024, 2023 and 2022 was $1.7 billion, $1.6
billion and $1.3 billion, respectively.
7.
Medical Costs Payable
The following table shows the components of the change in medical costs payable for the years ended December 31:
(in millions)
2024
2023
2022
Medical costs payable, beginning of period ................................................................
$
32,395 $
29,056 $
24,483
Acquisitions (dispositions), net ...................................................................................
(755)
1
308
Reported medical costs:
Current year .........................................................................................................
264,885
242,734
211,252
Prior years ............................................................................................................
(700)
(840)
(410)
Total reported medical costs .......................................................................................
264,185
241,894
210,842
Medical payments:
Payments for current year ....................................................................................
(231,890)
(211,380)
(184,049)
Payments for prior years ......................................................................................
(29,532)
(27,176)
(22,528)
Total medical payments ..............................................................................................
(261,422)
(238,556)
(206,577)
Less: medical costs payable included within businesses held for sale ........................
(179)
—
—
Medical costs payable, end of period ..........................................................................
$
34,224 $
32,395 $
29,056
For the years ended December 31, 2024, 2023 and 2022, prior years’ medical cost reserve development included no individual
factors that were significant. Medical costs payable included IBNR of $23.7 billion and $22.3 billion at December 31, 2024 and
2023, respectively. Substantially all of the IBNR balance as of December 31, 2024 relates to the current year.
55
The following is information about incurred and paid medical cost development as of December 31, 2024:
Net Incurred Medical Costs
(in millions)
For the Years Ended December 31,
Year
2023
2024
2023 ......................................................................................................
$
242,734
$
242,156
2024 ......................................................................................................
264,885
Total ......................................................................................................
$
507,041
Net Cumulative Medical Payments
(in millions)
For the Years Ended December 31,
Year
2023
2024
2023 ......................................................................................................
$
(211,380) $
(240,112)
2024 ......................................................................................................
(231,890)
Total ......................................................................................................
(472,002)
Net remaining outstanding liabilities prior to 2023 ..............................
119
Acquisitions (dispositions), net ............................................................
(755)
Medical costs payable included within businesses held for sale ..........
(179)
Total medical costs payable ..................................................................
$
34,224
56
8.
Short-Term Borrowings and Long-Term Debt
Short-term borrowings and senior unsecured long-term debt consisted of commercial paper and notes as follows:
Commercial paper .................................................
$
1,300
$
1,088
$1,000 4.625%, Jul 2035 ......................................
971
1,014
$750 3.5%, Feb 2024 ............................................
—
750
$850 5.8%, Mar 2036 ...........................................
838
838
$1,000 0.55%, May 2024 ......................................
—
999
$500 6.5%, Jun 2037 ............................................
492
491
$750 2.375%, Aug 2024 .......................................
—
750
$650 6.625%, Nov 2037 .......................................
641
640
$500 5%, Oct 2024 ...............................................
—
499
$1,100 6.875%, Feb 2038 .....................................
1,079
1,078
$2,000 3.75%, Jul 2025 ........................................
1,999
1,997
$1,250 3.5%, Aug 2039 ........................................
1,243
1,242
$750 5.15%, Oct 2025 ..........................................
749
748
$1,000 2.75%, May 2040 ......................................
970
968
$300 3.7%, Dec 2025 ...........................................
300
299
$300 5.7%, Oct 2040 ............................................
296
296
$500 1.25%, Jan 2026 ...........................................
499
498
$350 5.95%, Feb 2041 ..........................................
346
346
$1,000 3.1%, Mar 2026 ........................................
999
998
$1,500 3.05%, May 2041 ......................................
1,485
1,484
$1,000 1.15%, May 2026 ......................................
953
924
$600 4.625%, Nov 2041 .......................................
590
590
$500 floating rate, Jul 2026 ..................................
499
—
$502 4.375%, Mar 2042 .......................................
487
486
$650 4.75%, Jul 2026 ...........................................
648
—
$625 3.95%, Oct 2042 ..........................................
610
609
$750 3.45%, Jan 2027 ...........................................
749
748
$750 4.25%, Mar 2043 .........................................
737
736
$500 4.6%, Apr 2027 ............................................
496
—
$1,500 5.5%, Jul 2044 ..........................................
1,475
—
$625 3.375%, Apr 2027 ........................................
623
622
$2,000 4.75%, Jul 2045 ........................................
1,976
1,975
$600 3.7%, May 2027 ...........................................
598
598
$750 4.2%, Jan 2047 .............................................
739
739
$950 2.95%, Oct 2027 ..........................................
946
944
$725 4.25%, Apr 2047 ..........................................
718
718
$1,000 5.25%, Feb 2028 .......................................
998
1,011
$950 3.75%, Oct 2047 ..........................................
935
935
$1,150 3.85%, Jun 2028 .......................................
1,147
1,146
$1,350 4.25%, Jun 2048 .......................................
1,332
1,331
$850 3.875%, Dec 2028 .......................................
847
846
$1,100 4.45%, Dec 2048 ......................................
1,087
1,087
$1,250 4.25%, Jan 2029 ........................................
1,221
1,238
$1,250 3.7%, Aug 2049 ........................................
1,237
1,236
$400 4.7%, Apr 2029 ............................................
398
—
$1,250 2.9%, May 2050 ........................................
1,212
1,211
$900 4%, May 2029 ..............................................
854
862
$2,000 3.25%, May 2051 ......................................
1,972
1,972
$1,000 2.875%, Aug 2029 ....................................
902
908
$2,000 4.75%, May 2052 ......................................
1,966
1,966
$1,250 4.8%, Jan 2030 ..........................................
1,225
—
$2,000 5.875%, Feb 2053 .....................................
1,968
1,968
$1,250 5.3%, Feb 2030 .........................................
1,243
1,275
$2,000 5.05%, Apr 2053 .......................................
1,969
1,969
$1,250 2%, May 2030 ...........................................
1,240
1,238
$1,750 5.375%, Apr 2054 .....................................
1,729
—
$1,000 4.9%, Apr 2031 .........................................
982
—
$2,750 5.625%, Jul 2054 ......................................
2,724
—
$1,500 2.3%, May 2031 ........................................
1,271
1,290
$1,250 3.875%, Aug 2059 ....................................
1,229
1,229
$1,500 4.95%, Jan 2032 ........................................
1,489
—
$1,000 3.125%, May 2060 ....................................
967
966
$1,500 4.2%, May 2032 ........................................
1,372
1,412
$1,000 4.95%, May 2062 ......................................
981
981
$2,000 5.35%, Feb 2033 .......................................
1,966
2,046
$1,500 6.05%, Feb 2063 .......................................
1,466
1,466
$1,500 4.5%, Apr 2033 .........................................
1,410
1,463
$1,750 5.2%, Apr 2063 .........................................
1,710
1,709
$1,250 5%, Apr 2034 ............................................
1,214
—
$1,100 5.5%, Apr 2064 .........................................
1,085
—
$2,000 5.15%, Jul 2034 ........................................
1,959
—
$1,850 5.75%, Jul 2064 ........................................
1,822
—
Total short-term borrowings and long-term debt ..
$ 76,180
$ 61,473
Carrying Value as of
December 31,
Carrying Value as of
December 31,
(in millions, except percentages)
2024
2023
(continued)
2024
2023
The Company’s long-term debt obligations also included $0.7 billion and $1.1 billion of other financing obligations, of which
$197 million and $188 million were current as of December 31, 2024 and 2023, respectively.
57
Maturities of short-term borrowings and long-term debt for the years ending December 31 are as follows:
(in millions)
2025 ..........................................................................................................................................................................
$
4,548
2026 ..........................................................................................................................................................................
3,756
2027 ..........................................................................................................................................................................
3,531
2028 ..........................................................................................................................................................................
3,106
2029 ..........................................................................................................................................................................
3,656
Thereafter ..................................................................................................................................................................
59,908
Short-Term Borrowings
Commercial paper consists of short-duration, senior unsecured debt privately placed on a discount basis through broker-dealers.
As of December 31, 2024, the Company’s outstanding commercial paper had a weighted-average annual interest rate of 4.4%.
The Company has $7.0 billion five-year, $7.0 billion three-year and $7.0 billion 364-day revolving bank credit facilities with 26
banks, which mature in December 2029, December 2027 and December 2025, respectively. These facilities provide full
liquidity support for the Company’s commercial paper program and are available for general corporate purposes. As of
December 31, 2024, no amounts had been drawn on any of the bank credit facilities. The annual interest rates, which are
variable based on term, are calculated based on one-month term Secured Overnight Financing Rate (SOFR) plus a SOFR
Adjustment of 10 basis points plus a credit spread based on the Company’s senior unsecured credit ratings. If amounts had been
drawn on the bank credit facilities as of December 31, 2024, annual interest rates would have ranged from 4.9% to 7.5%.
Debt Covenants
As of December 31, 2024, the Company was in compliance with the various covenants under its bank credit facilities.
9.
Income Taxes
The current income tax provision reflects the tax consequences of revenues and expenses currently taxable or deductible on
various income tax returns for the year reported. The deferred income tax provision or benefit generally reflects the net change
in deferred income tax assets and liabilities during the year, excluding any deferred income tax assets and liabilities of acquired
businesses.
The components of income before income taxes, based upon tax jurisdiction, for the years ended December 31 are as follows:
(in millions)
2024
2023
2022
Income before income taxes:
Domestic ...............................................................................................................................
$ 28,264 $ 29,210 $ 26,685
Foreign ..................................................................................................................................
(8,193)
(98)
(342)
Total income before income taxes ...............................................................................................
$ 20,071 $ 29,112 $ 26,343
The components of the provision for income taxes for the years ended December 31 are as follows:
(in millions)
2024
2023
2022
Current Provision:
Federal ..................................................................................................................................
$ 3,453 $ 4,418 $ 4,842
State and local .......................................................................................................................
416
716
855
Foreign ..................................................................................................................................
1,256
1,079
680
Total current provision .................................................................................................................
5,125
6,213
6,377
Deferred benefit ...........................................................................................................................
(296)
(245)
(673)
Total provision for income taxes .................................................................................................
$ 4,829 $ 5,968 $ 5,704
58
The reconciliation of the tax provision at the U.S. federal statutory rate to the provision for income taxes and the effective tax
rate for the years ended December 31 is as follows:
(in millions, except percentages)
2024
2023
2022
Tax provision at the U.S. federal statutory rate ......................
$ 4,215
21.0 % $ 6,114
21.0 % $ 5,532
21.0 %
State income taxes, net of federal benefit ...............................
343
1.7
567
2.0
621
2.4
Share-based awards - excess tax benefit .................................
(96)
(0.5)
(75)
(0.3)
(110)
(0.4)
Non-deductible compensation .................................................
171
0.9
174
0.6
150
0.6
Foreign rate differential ...........................................................
(369)
(1.8)
(442)
(1.5)
(265)
(1.0)
Tax effect of dispositions and other strategic transactions .....
1,215
6.1
(29)
(0.1)
(215)
(0.8)
Other, net .................................................................................
(650)
(3.3)
(341)
(1.2)
(9)
(0.1)
Provision for income taxes ......................................................
$ 4,829
24.1 % $ 5,968
20.5 % $ 5,704
21.7 %
Deferred income tax assets and liabilities are recognized for the differences between the financial and income tax reporting
bases of assets and liabilities based on enacted tax rates and laws. The components of deferred income tax assets and liabilities
as of December 31 are as follows:
(in millions)
2024
2023
Deferred income tax assets:
Accrued expenses and allowances ........................................................................................
$
1,055 $
754
U.S. federal and state net operating loss carryforwards ........................................................
442
417
Share-based compensation ....................................................................................................
189
173
Nondeductible liabilities ........................................................................................................
343
329
Non-U.S. tax loss carryforwards ...........................................................................................
21
1,061
Lease liability ........................................................................................................................
846
930
Net unrealized losses on investments ....................................................................................
669
586
Other-domestic ......................................................................................................................
597
327
Other-non-U.S. ......................................................................................................................
59
484
Subtotal .........................................................................................................................................
4,221
5,061
Less: valuation allowances ...........................................................................................................
(397)
(366)
Total deferred income tax assets ..................................................................................................
3,824
4,695
Deferred income tax liabilities:
U.S. federal and state intangible assets .................................................................................
(4,479)
(3,712)
Non-U.S. goodwill and intangible assets ..............................................................................
(82)
(731)
Capitalized software ..............................................................................................................
(288)
(415)
Depreciation and amortization ..............................................................................................
(400)
(371)
Prepaid expenses ...................................................................................................................
(374)
(326)
Outside basis in partnerships .................................................................................................
(960)
(811)
Lease right-of-use asset .........................................................................................................
(833)
(914)
Other-non-U.S. ......................................................................................................................
(28)
(436)
Total deferred income tax liabilities .............................................................................................
(7,444)
(7,716)
Net deferred income tax liabilities ................................................................................................
$
(3,620) $
(3,021)
Valuation allowances are provided when it is considered more likely than not deferred tax assets will not be realized. The
valuation allowances primarily relate to future tax benefits on certain federal, state and non-U.S. net operating loss
carryforwards. Substantially all of the federal net operating loss carryforwards have indefinite carryforward periods; state net
operating loss carryforwards expire beginning in 2025 through 2044, with some having an indefinite carryforward period.
Additionally, as of December 31, 2024, the Company has historical non-U.S. net operating loss carryforwards for which a
deferred tax asset and valuation allowance of $4.1 billion are not established because realization of the loss carryforwards is
remote.
As of December 31, 2024, except for subsidiaries held for sale, the Company’s undistributed earnings from non-U.S.
subsidiaries are intended to be indefinitely reinvested in non-U.S. operations, and therefore no U.S. deferred taxes have been
recorded. Taxes payable on the remittance of such earnings would be minimal.
59
A reconciliation of the beginning and ending amount of unrecognized tax benefits as of December 31 is as follows:
(in millions)
2024
2023
2022
Gross unrecognized tax benefits, beginning of period ..............................................................
$ 3,716 $ 3,081 $ 2,310
Gross increases:
Current year tax positions ..................................................................................................
578
782
586
Prior year tax positions ......................................................................................................
10
97
206
Gross decreases:
Prior year tax positions ......................................................................................................
(121)
(212)
(21)
Statute of limitations lapses and settlements .....................................................................
(60)
(32)
—
Gross unrecognized tax benefits, end of period ........................................................................
$ 4,123 $ 3,716 $ 3,081
The Company believes it is reasonably possible its liability for unrecognized tax benefits will decrease in the next twelve
months by $101 million as a result of audit settlements and the expiration of statutes of limitations.
The Company classifies net interest and penalties associated with uncertain income tax positions as income taxes within its
Consolidated Statements of Operations. During the years ended December 31, 2024, 2023 and 2022, the Company recognized
$210 million, $177 million and $64 million of net interest and penalties, respectively. The Company had $637 million and $430
million of accrued interest and penalties for uncertain tax positions as of December 31, 2024 and 2023, respectively. These
amounts are not included in the reconciliation above. As of December 31, 2024, there were $2.0 billion of unrecognized tax
benefits which, if recognized, would affect the effective tax rate.
The Company currently files income tax returns in the United States, various states and localities and non-U.S. jurisdictions.
The U.S. Internal Revenue Service (IRS) has completed exams on the consolidated income tax returns for fiscal years 2016 and
prior. The Company’s 2017 through 2020 tax years are under review by the IRS under its Compliance Assurance Program. The
Company is no longer subject to state income tax examinations prior to the 2015 tax year. The Company is subject to
examination in non-U.S. jurisdictions for years 2015 and forward.
10.
Shareholders' Equity
Regulatory Capital and Dividend Restrictions
The Company’s regulated insurance and HMO subsidiaries are subject to regulations and standards in their respective
jurisdictions. These standards, among other things, require these subsidiaries to maintain specified levels of statutory capital, as
defined by each jurisdiction, and restrict the timing and amount of dividends and other distributions which may be paid to their
parent companies. In the United States, most of these state regulations and standards are generally consistent with model
regulations established by the NAIC. These standards generally permit dividends to be paid from statutory unassigned surplus
of the regulated subsidiary and are limited based on the regulated subsidiary’s level of statutory net income and statutory capital
and surplus. These dividends are referred to as “ordinary dividends” and generally may be paid without prior regulatory
approval. If the dividend, together with other dividends paid within the preceding twelve months, exceeds a specified statutory
limit or is paid from sources other than earned surplus, it is generally considered an “extraordinary dividend” and must receive
prior regulatory approval.
For the year ended December 31, 2024, the Company’s domestic insurance and HMO subsidiaries paid their parent companies
dividends of $9.2 billion, including $2.6 billion of extraordinary dividends. For the year ended December 31, 2023, the
Company’s domestic insurance and HMO subsidiaries paid their parent companies dividends of $8.0 billion, including $4.9
billion of extraordinary dividends.
The Company's financially regulated subsidiaries had estimated aggregate statutory capital and surplus of $37.8 billion as of
December 31, 2024. The estimated statutory capital and surplus necessary to satisfy regulatory requirements of the Company's
financially regulated subsidiaries was approximately $20.4 billion as of December 31, 2024.
Optum Bank must meet minimum capital requirements of the FDIC under the capital adequacy rules to which it is subject. At
December 31, 2024, the Company believes Optum Bank met the FDIC requirements to be considered “Well Capitalized.”
Share Repurchase Program
Under its Board of Directors’ authorization, the Company maintains a share repurchase program. The objectives of the share
repurchase program are to optimize the Company’s capital structure and cost of capital, thereby improving returns to
shareholders, as well as to offset the dilutive impact of share-based awards. Repurchases may be made from time to time in
open market purchases or other types of transactions (including prepaid or structured share repurchase programs), subject to
certain restrictions. In June 2024, the Board of Directors amended the Company’s share repurchase program to authorize the
60
repurchase of up to 35 million shares of its common stock, in addition to all remaining shares authorized to be repurchased
under the Board’s 2018 renewal of the program. The Board of Directors from time to time may further amend the share
repurchase program in order to increase the authorized number of shares which may be repurchased under the program.
A summary of common share repurchases for the years ended December 31, 2024 and 2023 is as follows:
Years Ended December 31,
(in millions, except per share data)
2024
2023
Common share repurchases, shares ...............................................................
17
16
Common share repurchases, average price per share ....................................
$
529.85 $
493.79
Common share repurchases, aggregate cost ..................................................
$
8,942 $
8,000
Board authorized shares remaining ...............................................................
33
15
Dividends
In June 2024, the Company’s Board of Directors increased the Company’s quarterly cash dividend to shareholders to an annual
rate of $8.40 compared to $7.52 per share, which the Company had paid since June 2023. Declaration and payment of future
quarterly dividends is at the discretion of the Board and may be adjusted as business needs or market conditions change.
The following table provides details of the Company’s 2024 dividend payments:
Payment Date
Amount per Share
Total Amount Paid
(in millions)
March 19 .......................................................................................................
$
1.88 $
1,729
June 25 ..........................................................................................................
2.10
1,935
September 24 .................................................................................................
2.10
1,937
December 17 .................................................................................................
2.10
1,932
11.
Share-Based Compensation
The Company’s outstanding share-based awards consist mainly of non-qualified stock options and restricted shares. As of
December 31, 2024, the Company had 48 million shares available for future grants of share-based awards under the 2020 Stock
Incentive Plan. As of December 31, 2024, there were 16 million shares of common stock available for issuance under the ESPP.
Stock Options
Stock option activity for the year ended December 31, 2024 is summarized in the table below:
Shares
Weighted-
Average
Exercise
Price
Weighted-
Average
Remaining
Contractual Life
Aggregate
Intrinsic Value
(in millions)
(in years)
(in millions)
Outstanding at beginning of period ...................................
21 $
320
Granted ..............................................................................
3
522
Exercised ...........................................................................
(6)
253
Forfeited ............................................................................
(1)
480
Outstanding at end of period .............................................
17
370
5.6
$
2,338
Exercisable at end of period ..............................................
10
298
4.2
2,115
Vested and expected to vest, end of period .......................
17
368
5.5
2,335
61
Restricted Shares
Restricted share activity for the year ended December 31, 2024 is summarized in the table below:
(shares in millions)
Shares
Weighted-Average
Grant Date
Fair Value
per Share
Nonvested at beginning of period ......................................................................................
4 $
449
Granted ...............................................................................................................................
2
523
Vested .................................................................................................................................
(2)
435
Nonvested at end of period .................................................................................................
4
489
Other Share-Based Compensation Data
(in millions, except per share amounts)
For the Years Ended December 31,
2024
2023
2022
Stock Options
Weighted-average grant date fair value of shares granted, per share ..........................
$
138 $
134 $
116
Total intrinsic value of stock options exercised ..........................................................
1,886
1,325
1,419
Restricted Shares
Weighted-average grant date fair value of shares granted, per share ..........................
523
493
483
Total fair value of restricted shares vested ..................................................................
690
803
760
Employee Stock Purchase Plan
Number of shares purchased .......................................................................................
1
1
1
Share-Based Compensation Items
Share-based compensation expense, before tax ..........................................................
$
1,018 $
1,059 $
925
Share-based compensation expense, net of tax effects ...............................................
896
937
836
Income tax benefit realized from share-based award exercises ..................................
216
231
207
(in millions, except years)
December 31, 2024
Unrecognized compensation expense related to share awards ...............................................................
$
1,099
Weighted-average years to recognize compensation expense ................................................................
1.3
Share-Based Compensation Recognition and Estimates
The principal assumptions the Company used in calculating grant-date fair value for stock options were as follows:
For the Years Ended December 31,
2024
2023
2022
Risk-free interest rate ...................................................................
3.6% - 4.4%
3.8% - 4.6%
1.9% - 4.3%
Expected volatility .......................................................................
25.5% - 30.7%
29.7% - 30.6%
30.6% - 30.8%
Expected dividend yield ...............................................................
1.4% - 1.5%
1.3% - 1.5%
1.2%
Forfeiture rate ...............................................................................
5.0%
5.0%
5.0%
Expected life in years ...................................................................
4.6
4.6
4.7
Risk-free interest rates are based on U.S. Treasury yields in effect at the time of grant. Expected volatilities are based on the
historical volatility of the Company’s common stock and the implied volatility from exchange-traded options on the Company’s
common stock. Expected dividend yields are based on the per share cash dividend paid by the Company. The Company uses
historical data to estimate option exercises and forfeitures within the valuation model. The expected lives of options granted
represent the periods of time the awards granted are expected to be outstanding based on historical exercise patterns.
Other Employee Benefit Plans
The Company offers a 401(k) plan for its employees. Compensation expense related to this plan was not material for the years
ended December 31, 2024, 2023 and 2022.
In addition, the Company maintains non-qualified, deferred compensation plans, which allow certain members of senior
management and executives to defer portions of their salary or bonus. The deferrals are recorded within long-term investments
62
with an approximately equal amount in other liabilities in the Consolidated Balance Sheets. The total deferrals are distributable
based upon termination of employment or other periods, as elected under each plan and were $2.1 billion and $1.9 billion as of
December 31, 2024 and 2023, respectively.
12.
Commitments and Contingencies
Leases
Operating lease costs, including immaterial variable and short-term lease costs, were $1.4 billion, $1.4 billion and $1.3 billion
for the years ended December 31, 2024, 2023 and 2022, respectively. Cash payments made on the Company’s operating lease
liabilities were $1.1 billion, $1.1 billion and $1.0 billion for the years ended December 31, 2024, 2023 and 2022, respectively,
which were classified within operating activities in the Consolidated Statements of Cash Flows. As of December 31, 2024, the
Company’s weighted-average remaining lease term and weighted-average discount rate for its operating leases were 9.5 years
and 4.7%, respectively.
As of December 31, 2024, future minimum annual lease payments under all non-cancelable operating leases were as follows:
(in millions)
Future Minimum
Lease Payments
2025 ..............................................................................................................................................................
$
1,014
2026 ..............................................................................................................................................................
876
2027 ..............................................................................................................................................................
688
2028 ..............................................................................................................................................................
568
2029 ..............................................................................................................................................................
583
Thereafter ......................................................................................................................................................
2,465
Total future minimum lease payments ..................................................................................................
6,194
Less imputed interest ....................................................................................................................................
(1,305)
Total ..............................................................................................................................................................
$
4,889
Other Commitments
The Company provides guarantees related to its service level under certain contracts. If minimum standards are not met, the
Company may be financially at risk up to a stated percentage of the contracted fee or a stated dollar amount. None of the
amounts accrued, paid or charged to income for service level guarantees were material as of December 31, 2024, 2023 or 2022.
Pending Acquisitions
As of December 31, 2024, the Company has entered into agreements to acquire companies in the health care sector, subject to
regulatory approval and other customary closing conditions. The total anticipated capital required for these acquisitions,
excluding the payoff of acquired indebtedness, is approximately $4 billion.
Legal Matters
The Company is frequently made party to a variety of legal actions and regulatory inquiries, including class actions and suits
brought by members, care providers, consumer advocacy organizations, customers and regulators, relating to the Company’s
businesses, including management and administration of health benefit plans and other services. These matters include medical
malpractice, employment, intellectual property, antitrust, privacy and contract claims and claims related to health care benefits
coverage and other business practices.
The Company records liabilities for its estimates of probable costs resulting from these matters where appropriate. Estimates of
costs resulting from legal and regulatory matters involving the Company are inherently difficult to predict, particularly where
the matters: involve indeterminate claims for monetary damages or may involve fines, penalties or punitive damages; present
novel legal theories or represent a shift in regulatory policy; involve a large number of claimants or regulatory bodies; are in the
early stages of the proceedings; or could result in a change in business practices. Accordingly, the Company is often unable to
estimate the losses or ranges of losses for those matters where there is a reasonable possibility or it is probable a loss may be
incurred.
Government Investigations, Audits and Reviews
The Company has been involved or is currently involved in various governmental investigations, audits and reviews. These
include routine, regular and special investigations, audits and reviews by CMS, state insurance and health and welfare
departments, state attorneys general, the Office of the Inspector General, the Office of Personnel Management, the Office for
Civil Rights, the Government Accountability Office, the Federal Trade Commission, U.S. Congressional committees, the U.S.
Department of Justice (DOJ), the SEC, the IRS, the U.S. Drug Enforcement Administration, the U.S. Department of Labor, the
63
FDIC, the Consumer Financial Protection Bureau, the Defense Contract Audit Agency, the Food and Drug Administration and
other governmental authorities. Similarly, the Company’s international businesses are also subject to investigations, audits and
reviews by applicable foreign governments and other non-U.S. governmental authorities. Certain of the Company’s businesses
have been reviewed or are currently under review, including for, among other matters, compliance with coding and other
requirements under the Medicare risk-adjustment model. CMS has selected certain of the Company’s local plans for risk
adjustment data validation (RADV) audits to validate the coding practices of and supporting documentation maintained by
health care providers and such audits may result in retrospective adjustments to payments made to the Company’s health plans.
On February 14, 2017, the DOJ announced its decision to pursue certain claims within a lawsuit initially asserted against the
Company and filed under seal by a whistleblower in 2011. The whistleblower’s complaint, which was unsealed on February 15,
2017, alleges the Company made improper risk adjustment submissions and violated the False Claims Act. On February 12,
2018, the court granted in part and denied in part the Company’s motion to dismiss. In May 2018, the DOJ moved to dismiss
the Company’s counterclaims, which were filed in March 2018, and moved for partial summary judgment. In March 2019, the
court denied the government’s motion for partial summary judgment and dismissed the Company’s counterclaims without
prejudice. The Company cannot reasonably estimate the outcome which may result from this matter given its procedural status.
13.
Dispositions and Held for Sale
During the year ended December 31, 2024, the Company completed or initiated various business portfolio refinement and asset
disposition activities. The Company recorded a loss of $7.1 billion related to the sale of its Brazil operations, of which $4.1
billion related to the impact of cumulative foreign currency translation losses previously included in accumulated other
comprehensive loss, and a loss of $1.2 billion related to the reclassification of the Company’s remaining South American
operations as held for sale, of which $855 million related to the impact of cumulative foreign currency translation losses.
As these losses relate to our strategic exit of South American markets and include significant losses related to foreign currency
translation effects, these losses are included within loss on sale of subsidiary and subsidiaries held for sale on the Consolidated
Statement of Operations. The sales of the Company’s remaining South American assets are expected to close within a year,
subject to regulatory and other customary closing conditions. Assets and liabilities held for sale have been included within
prepaid and other current assets and other current liabilities on the Consolidated Balance Sheet, respectively.
The assets and liabilities of the Brazil and held for sale disposal groups as of the date of the sale and as of December 31, 2024,
respectively, were as follows:
(in millions)
Brazil
Disposition
Businesses
Held for Sale
Assets
Cash and cash equivalents .............................................................................................
$
778
$
219
Accounts receivable and other current assets ................................................................
515
573
Long-term investments ..................................................................................................
788
41
Property, equipment and capitalized software ...............................................................
1,052
641
Deferred tax assets .........................................................................................................
1,035
—
Goodwill and other intangible assets .............................................................................
317
413
Other long-term assets ...................................................................................................
439
231
Remeasurement of assets of businesses held for sale to fair value less cost to sell(1)
....
—
(1,224)
Total assets ................................................................................................................
$
4,924
$
894
Liabilities
Medical costs payable ....................................................................................................
$
701
$
179
Accounts payable and other current liabilities ...............................................................
834
338
Other long-term liabilities ..............................................................................................
136
504
Total liabilities ..........................................................................................................
$
1,671
$
1,021
(1) Includes the effect of $855 million of cumulative foreign currency translation losses and $56 million of noncontrolling
interests.
As a result of continued portfolio refinement, the Company sold other businesses and assets and entered into strategic
transactions. These transactions resulted in total consideration received of $3.0 billion and an additional $1.9 billion of equity
method investments related to the valuation of our retained interests in certain transactions. The carrying value for these
transactions was $1.0 billion, primarily related to goodwill. The gains from business portfolio refinement, including strategic
64
transactions, were recorded within operating costs in the Consolidated Statement of Operations and contributed about 80 basis
points ($3.3 billion) to the operating cost ratio, nearly half ($1.4 billion) related to Optum Health with the remainder split
between UnitedHealthcare ($1.1 billion) and Optum Insight ($800 million). Certain transactions also included various put and
call options, which were valued at $630 million and included in other liabilities on the Consolidated Balance Sheet. As of
December 31, 2024 the total estimated future obligation under these arrangements if the Company decided or was required to
repurchase these interests was up to $3.4 billion.
14.
Segment Financial Information
Factors used to determine the Company’s reportable segments include the nature of operating activities, economic
characteristics, existence of separate senior management teams and the type of information used by the Company’s chief
operating decision maker (CODM), which is the Chief Executive Officer, to evaluate its results of operations. Reportable
segments with similar economic characteristics, products and services, customers, distribution methods and operational
processes which operate in a similar regulatory environment are combined. The CODM uses consolidated expense information
and segment earnings from operations to assess performance and determine allocation of resources.
The following is a description of the types of products and services from which each of the Company’s four reportable
segments derives its revenues:
•
UnitedHealthcare includes the combined results of operations of UnitedHealthcare Employer & Individual,
UnitedHealthcare Medicare & Retirement and UnitedHealthcare Community & State. The businesses share significant
common assets, including a contracted network of physicians, health care professionals, hospitals and other facilities,
information technology and consumer engagement infrastructure and other resources. UnitedHealthcare Employer &
Individual offers an array of consumer-oriented health benefit plans and services for employers and individuals.
UnitedHealthcare Medicare & Retirement provides health care coverage and health and well-being services to
individuals age 50 and older, addressing their unique needs. UnitedHealthcare Community & State provides
diversified health care benefits products and services to state programs caring for the economically disadvantaged, the
medically underserved and those without the benefit of employer-funded health care coverage.
•
Optum Health focuses on care delivery, including value-based care; care management; wellness and consumer
engagement and health financial services. Optum Health is building a comprehensive, connected health care delivery
and engagement platform by directly providing high-quality care, helping people manage chronic and complex health
needs, and proactively engaging consumers in managing their health through in-person, in-home, virtual and digital
clinical platforms.
•
Optum Insight brings together advanced analytics, technology and health care expertise to deliver integrated services
and solutions. Hospital systems, physicians, health plans, governments, life sciences companies and other
organizations depend on Optum Insight to help them improve performance, achieve efficiency, reduce costs, meet
compliance mandates and modernize their core operating systems to meet the changing needs of the health system.
•
Optum Rx offers pharmacy care services and programs, including retail network contracting, home delivery, specialty
and community health pharmacy services, infusion, purchasing and clinical capabilities, and develops programs in
areas such as step therapy, formulary management, drug adherence and disease and drug therapy management. Optum
Rx integrates pharmacy and medical care and is positioned to serve patients with complex clinical needs and
consumers looking for a better digital pharmacy experience with transparent pricing.
The Company’s accounting policies for reportable segment operations are consistent with those described in the Summary of
Significant Accounting Policies (see Note 2). Transactions between reportable segments principally consist of sales of
pharmacy care products and services to UnitedHealthcare customers by Optum Rx; care delivery, care management services
and certain product offerings sold to UnitedHealthcare by Optum Health; and health information and technology solutions,
consulting and other services sold to UnitedHealthcare by Optum Insight. These transactions are recorded at management’s
estimate of fair value. Transactions with affiliated customers are eliminated in consolidation. Assets and liabilities jointly used
are assigned to each reportable segment using estimates of pro-rata usage. Cash and investments are assigned so each reportable
segment has working capital and/or at least minimum specified levels of regulatory capital.
As a percentage of the Company’s total consolidated revenues, premium revenues from CMS were 40%, 40% and 38% for the
years ended December 31, 2024, 2023 and 2022, respectively, most of which were generated by UnitedHealthcare Medicare &
Retirement and included in the UnitedHealthcare segment. U.S. customer revenue represented approximately 99%, 97% and
97% of consolidated total revenues for 2024, 2023 and 2022, respectively. Long-lived fixed assets located in the United States
represented approximately 92% and 82% of the total long-lived fixed assets as of December 31, 2024 and 2023, respectively.
The non-U.S. revenues and fixed assets are primarily related to UnitedHealthcare Employer & Individual’s international
businesses.
65
The following table presents the reportable segment financial information:
Optum
(in millions)
UnitedHealthcare
Optum Health
Optum Insight
Optum Rx
Optum
Eliminations
Optum
Corporate and
Eliminations
Consolidated
2024
Revenues - unaffiliated customers:
Premiums ................................................
$
286,004
$
22,806
$
—
$
—
$
—
$
22,806
$
—
$
308,810
Products ...................................................
—
277
174
49,775
—
50,226
—
50,226
Services ...................................................
9,791
16,153
6,466
3,630
—
26,249
—
36,040
Total revenues - unaffiliated customers .........
295,795
39,236
6,640
53,405
—
99,281
—
395,076
Total revenues - affiliated customers .............
—
63,883
11,881
79,512
(4,389)
150,887
(150,887)
—
Investment and other income .........................
2,413
2,239
236
314
—
2,789
—
5,202
Total revenues ................................................
$
298,208
$
105,358
$
18,757
$ 133,231
$
(4,389) $ 252,957
$
(150,887) $
400,278
Total operating costs (a) .................................
$
282,624
$
97,588
$
15,660
$ 127,395
$
(4,389) $ 236,254
$
(150,887) $
367,991
Earnings from operations ...............................
$
15,584
$
7,770
$
3,097
$
5,836
$
—
$
16,703
$
—
$
32,287
Interest expense ..............................................
—
—
—
—
—
—
(3,906)
(3,906)
Loss on sale of subsidiary and subsidiaries
held for sale ...............................................
(8,310)
—
—
—
—
—
—
(8,310)
Earnings before income taxes ........................
$
7,274
$
7,770
$
3,097
$
5,836
$
—
$
16,703
$
(3,906) $
20,071
Total assets .....................................................
$
119,009
$
96,472
$
34,452
$ 59,086
$
—
$ 190,010
$
(10,741) $
298,278
Purchases of property, equipment and
capitalized software ..................................
781
1,008
1,291
419
—
2,718
—
3,499
Depreciation and amortization .......................
889
1,123
1,294
793
—
3,210
—
4,099
2023
Revenues - unaffiliated customers:
Premiums ................................................
$
269,052
$
21,775
$
—
$
—
$
—
$
21,775
$
—
$
290,827
Products ...................................................
—
207
162
42,214
—
42,583
—
42,583
Services ...................................................
10,057
14,109
7,760
2,197
—
24,066
—
34,123
Total revenues - unaffiliated customers .........
279,109
36,091
7,922
44,411
—
88,424
—
367,533
Total revenues - affiliated customers .............
—
57,696
10,896
71,484
(3,703)
136,373
(136,373)
—
Investment and other income .........................
2,251
1,532
114
192
—
1,838
—
4,089
Total revenues ................................................
$
281,360
$
95,319
$
18,932
$ 116,087
$
(3,703) $ 226,635
$
(136,373) $
371,622
Total operating costs (a) .................................
$
264,945
$
88,759
$
14,664
$ 110,972
$
(3,703) $ 210,692
$
(136,373) $
339,264
Earnings from operations ...............................
$
16,415
$
6,560
$
4,268
$
5,115
$
—
$
15,943
$
—
$
32,358
Interest expense ..............................................
—
—
—
—
—
—
(3,246)
(3,246)
Earnings before income taxes ........................
$
16,415
$
6,560
$
4,268
$
5,115
$
—
$
15,943
$
(3,246) $
29,112
Total assets .....................................................
$
110,943
$
89,432
$
34,173
$ 51,266
$
—
$ 174,871
$
(12,094) $
273,720
Purchases of property, equipment and
capitalized software ..................................
866
1,199
974
347
—
2,520
—
3,386
Depreciation and amortization .......................
989
1,058
1,229
696
—
2,983
—
3,972
2022
Revenues - unaffiliated customers:
Premiums ................................................
$
238,783
$
18,374
$
—
$
—
$
—
$
18,374
$
—
$
257,157
Products ...................................................
—
72
180
37,172
—
37,424
—
37,424
Services ...................................................
10,035
10,917
4,996
1,603
—
17,516
—
27,551
Total revenues - unaffiliated customers .........
248,818
29,363
5,176
38,775
—
73,314
—
322,132
Total revenues - affiliated customers .............
—
40,883
9,288
60,936
(2,760)
108,347
(108,347)
—
Investment and other income .........................
923
928
117
62
—
1,107
—
2,030
Total revenues ................................................
$
249,741
$
71,174
$
14,581
$ 99,773
$
(2,760) $ 182,768
$
(108,347) $
324,162
Total operating costs (a) .................................
$
235,362
$
65,142
$
10,993
$ 95,337
$
(2,760) $ 168,712
$
(108,347) $
295,727
Earnings from operations ...............................
$
14,379
$
6,032
$
3,588
$
4,436
$
—
$
14,056
$
—
$
28,435
Interest expense ..............................................
—
—
—
—
—
—
(2,092)
(2,092)
Earnings before income taxes ........................
$
14,379
$
6,032
$
3,588
$
4,436
$
—
$
14,056
$
(2,092) $
26,343
Total assets .....................................................
$
107,094
$
68,950
$
31,090
$ 47,476
$
—
$ 147,516
$
(8,905) $
245,705
Purchases of property, equipment and
capitalized software ..................................
799
997
698
308
—
2,003
—
2,802
Depreciation and amortization .......................
973
943
841
643
—
2,427
—
3,400
(a)
Total operating costs include medical costs, operating costs, cost of products sold and depreciation and amortization, as applicable for each
reportable segment.
66
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
ITEM 9A.
CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act
of 1934 (Exchange Act) designed to provide reasonable assurance the information required to be disclosed by us in reports we
file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in
SEC rules and forms; and (ii) accumulated and communicated to our management, including our principal executive officer and
principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
In connection with the filing of this Annual Report on Form 10-K, management evaluated, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of our
disclosure controls and procedures as of December 31, 2024. Based upon their evaluation, our Chief Executive Officer and
Chief Financial Officer concluded our disclosure controls and procedures were effective at the reasonable assurance level as of
December 31, 2024.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial reporting during the quarter ended December 31, 2024 which
have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Report of Management on Internal Control Over Financial Reporting as of December 31, 2024
Management of UnitedHealth Group Incorporated and Subsidiaries (the Company) is responsible for establishing and
maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities
Exchange Act of 1934. The Company’s internal control system is designed to provide reasonable assurance to our management
and board of directors regarding the reliability of financial reporting and the preparation of consolidated financial statements for
external purposes in accordance with generally accepted accounting principles. The Company’s internal control over financial
reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance
with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on
the consolidated financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. In
making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) in Internal Control-Integrated Framework (2013). Based on our assessment and the COSO criteria, we
believe that, as of December 31, 2024, the Company maintained effective internal control over financial reporting.
The Company’s independent registered public accounting firm has audited the Company’s internal control over financial
reporting as of December 31, 2024, as stated in the Report of Independent Registered Public Accounting Firm, appearing under
Item 9A.
67
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of UnitedHealth Group Incorporated and Subsidiaries:
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of UnitedHealth Group Incorporated and subsidiaries (the
“Company”) as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company
maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on
criteria established in Internal Control — Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our
report dated February 27, 2025, expressed an unqualified opinion on those financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report of
Management on Internal Control Over Financial Reporting as of December 31, 2024. Our responsibility is to express an opinion
on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with
the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all
material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk
that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit
provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ DELOITTE & TOUCHE LLP
Minneapolis, Minnesota
February 27, 2025
68
ITEM 9B.
OTHER INFORMATION
Trading Arrangements
During the quarter ended December 31, 2024, none of the Company’s directors or officers (as defined in Rule 16a-1(f) under
the Exchange Act) adopted or terminated any contract, instruction or written plan for the purchase or sale of Company
securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or under any non-
Rule 10b5-1 trading arrangement.
ITEM 9C.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not Applicable.
PART III
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following sets forth certain information regarding our directors as of February 27, 2025, including their name and principal
occupation or employment:
Charles Baker
Michele Hooper
President
National Collegiate Athletic Association
Lead Independent Director
UnitedHealth Group
President and Chief Executive Officer
The Directors’ Council
Timothy Flynn
F. William McNabb III
Retired Chair
KPMG International
Former Chairman and Chief Executive Officer
The Vanguard Group, Inc.
Paul Garcia
Valerie Montgomery Rice, M.D.
Retired Chair and Chief Executive Officer
Global Payments Inc.
President and Chief Executive Officer
Morehouse School of Medicine
Kristen Gil
John Noseworthy, M.D.
Former Vice President and Business Finance Officer
Alphabet Inc.
Former Chief Executive Officer and President
Mayo Clinic
Stephen Hemsley
Andrew Witty
Chair
UnitedHealth Group
Chief Executive Officer
UnitedHealth Group
Pursuant to General Instruction G(3) to Form 10-K and the Instruction to Item 401 of Regulation S-K, information regarding
our executive officers is provided in Part I, Item 1 under the caption “Information About our Executive Officers.”
We have adopted a code of ethics applicable to our principal executive officer and other senior financial officers, who include
our principal financial officer, principal accounting officer, controller and persons performing similar functions. The code of
ethics, entitled Code of Conduct: Our Principles of Ethics and Integrity, is posted on our website at
www.unitedhealthgroup.com. For information about how to obtain the Code of Conduct, see Part I, Item 1, “Business.” We
intend to satisfy the SEC’s disclosure requirements regarding amendments to, or waivers of, the code of ethics for our senior
financial officers by posting such information on our website indicated above.
The remaining information required by Items 401, 405, 406 and 407(c)(3), (d)(4) and (d)(5) of Regulation S-K will be included
under the headings “Corporate Governance” and “Proposal 1-Election of Directors” in our definitive proxy statement for our
2025 Annual Meeting of Shareholders, and such required information is incorporated herein by reference.
The information required by Item 408(b) of Regulation S-K will be included under the heading “Insider Trading Policy” in our
definitive proxy statement for our 2025 Annual Meeting of Shareholders, and such required information is incorporated herein
by reference. A copy of our insider trading policy is filed as Exhibit 19.1 to this Form 10-K.
69
ITEM 11.
EXECUTIVE COMPENSATION
The information required by Items 402 and 407(e)(4) and (e)(5) of Regulation S-K will be included under the headings
“Executive Compensation,” “Director Compensation,” “Corporate Governance - Risk Oversight” and “Compensation
Committee Interlocks and Insider Participation” in our definitive proxy statement for our 2025 Annual Meeting of
Shareholders, and such required information is incorporated herein by reference.
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
Equity Compensation Plan Information
The following table sets forth certain information as of December 31, 2024, concerning shares of common stock authorized for
issuance under all of our equity compensation plans:
Plan category
(a)
Number of securities
to be issued upon exercise
of outstanding options,
warrants and rights
(b)
Weighted-average
exercise price of
outstanding options,
warrants and rights
(c)
Number of securities
remaining available for
future issuance under
equity compensation plans
(excluding securities
reflected in column (a))
(in millions)
(in millions)
Equity compensation plans approved by
shareholders (1)
.............................................
17
$
370
64
(3)
Equity compensation plans not approved by
shareholders (2)
.............................................
—
—
Total (2)
...............................................................
17
$
370
64
(1) Consists of the UnitedHealth Group Incorporated 2020 Stock Incentive Plan (the “2020 Stock Incentive Plan”), as
amended, and the UnitedHealth Group 1993 Employee Stock Purchase Plan, as amended (the “ESPP”).
(2) Excludes 60,000 shares underlying stock options assumed by us in connection with acquisitions. These options have a
weighted-average exercise price of $373 and an average remaining term of approximately 2.4 years. These options are
administered pursuant to the terms of the plans under which the options originally were granted. No future awards will
be granted under these acquired plans.
(3) Includes 16 million shares of common stock available for future issuance under the ESPP as of December 31, 2024,
and 48 million shares available under the 2020 Stock Incentive Plan as of December 31, 2024. Shares available under
the 2020 Stock Incentive Plan may become the subject of future awards in the form of stock options, stock
appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based awards.
The information required by Item 403 of Regulation S-K will be included under the heading “Security Ownership of Certain
Beneficial Owners and Management” in our definitive proxy statement for our 2025 Annual Meeting of Shareholders, and such
required information is incorporated herein by reference.
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
The information required by Items 404 and 407(a) of Regulation S-K will be included under the headings “Certain
Relationships and Transactions” and “Corporate Governance” in our definitive proxy statement for our 2025 Annual Meeting of
Shareholders, and such required information is incorporated herein by reference.
ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by Item 9(e) of Schedule 14A will be included under the heading “Disclosure of Fees Paid to
Independent Registered Public Accounting Firm” in our definitive proxy statement for our 2025 Annual Meeting of
Shareholders, and such required information is incorporated herein by reference.
70
PART IV
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)
1. Financial Statements
The financial statements are included under Item 8 of this report:
•
Reports of Independent Registered Public Accounting Firm.
•
Consolidated Balance Sheets as of December 31, 2024 and 2023.
•
Consolidated Statements of Operations for the years ended December 31, 2024, 2023, and 2022.
•
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023, and 2022.
•
Consolidated Statements of Changes in Equity for the years ended December 31, 2024, 2023, and 2022.
•
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022.
•
Notes to the Consolidated Financial Statements.
2. Financial Statement Schedules
The following financial statement schedule of the Company is included in Item 15(c):
•
Schedule I - Condensed Financial Information of Registrant (Parent Company Only).
All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under
the related instructions, are inapplicable, or the required information is included in the consolidated financial statements,
and therefore have been omitted.
(b)
The following exhibits are filed or incorporated by reference herein in response to Item 601 of Regulation S-K. The
Company files Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K
pursuant to the Securities Exchange Act of 1934 under Commission File No. 1-10864.
EXHIBIT INDEX**
3.1
Certificate of Incorporation of UnitedHealth Group Incorporated (incorporated by reference to Exhibit 3.1 to
UnitedHealth Group Incorporated’s Registration Statement on Form 8-A/A, Commission File No. 1-10864, filed
on July 1, 2015)
3.2
Amended and Restated Bylaws of UnitedHealth Group Incorporated, effective February 23, 2021 (incorporated
by reference to Exhibit 3.2 to UnitedHealth Group Incorporated’s Current Report on Form 8-K filed on February
26, 2021)
4.1
Amended and Restated Indenture, dated as of April 27, 2023, between UnitedHealth Group Incorporated and
Wilmington Trust Company, as successor trustee (incorporated by reference to Exhibit 4.1 to UnitedHealth Group
Incorporated’s Current Report on Form 8-K filed on April 28, 2023)
4.2
Indenture, dated as of February 4, 2008, between UnitedHealth Group Incorporated and U.S. Bank National
Association (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-3, SEC
File Number 333-149031, filed on February 4, 2008)
4.3
Supplemental Indenture, dated as of April 18, 2023, between UnitedHealth Group Incorporated and U.S. Bank
Trust Company, National Association, as trustee, relating to the 6.875% Senior Notes due 2038 (incorporated by
reference to Exhibit 4.1 to UnitedHealth Group Incorporated’s Current Report on Form 8-K filed on April 24,
2023)
4.4
Description of Common Stock (incorporated by reference to Exhibit 4.5 to UnitedHealth Group Incorporated’s
Annual Report on Form 10-K for the year ended December 31, 2019)
*10.1
UnitedHealth Group 2020 Stock Incentive Plan (incorporated by reference to Exhibit 4.1 to the Company’s
Registration Statement on Form S-8, SEC File Number 333-238854, filed on June 1, 2020)
*10.2
Form of Agreement for Restricted Stock Unit Award to Executives under UnitedHealth Group Incorporated’s
2020 Stock Incentive Plan (2024 Version) (incorporated by reference to Exhibit 10.2 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.3
Form of Agreement for Nonqualified Stock Option Award to Executives under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (2024 Version) (incorporated by reference to Exhibit 10.3 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.4
Form of Agreement for Performance-Based Restricted Stock Unit Award to Executives under UnitedHealth
Group Incorporated’s 2020 Stock Incentive Plan (2024 Version) (incorporated by reference to Exhibit 10.4 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
71
*10.5
Form of Agreement for Restricted Stock Unit Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (2024 Version) (incorporated by reference to Exhibit 10.5 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.6
Form of Agreement for Nonqualified Stock Option Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (2024 Version) (incorporated by reference to Exhibit 10.6 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.7
Form of Agreement for Performance-Based Restricted Stock Unit Award under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (Witty) (2024 Version) (incorporated by reference to Exhibit 10.7 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.8
Form of Agreement for Restricted Stock Unit Award to Executives under UnitedHealth Group Incorporated’s
2020 Stock Incentive Plan (2023 Version) (incorporated by reference to Exhibit 10.2 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.9
Form of Agreement for Nonqualified Stock Option Award to Executives under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (2023 Version) (incorporated by reference to Exhibit 10.3 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.10
Form of Agreement for Performance-Based Restricted Stock Unit Award to Executives under UnitedHealth
Group Incorporated’s 2020 Stock Incentive Plan (2023 Version) (incorporated by reference to Exhibit 10.4 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.11
Form of Agreement for Restricted Stock Unit Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (2023 Version) (incorporated by reference to Exhibit 10.5 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.12
Form of Agreement for Nonqualified Stock Option Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (2023 Version) (incorporated by reference to Exhibit 10.6 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.13
Form of Agreement for Performance-Based Restricted Stock Unit Award under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (Witty) (2023 Version) (incorporated by reference to Exhibit 10.7 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.14
Form of Agreement for Restricted Stock Unit Award to Executives under UnitedHealth Group Incorporated’s
2020 Stock Incentive Plan (incorporated by reference to Exhibit 10.2 to UnitedHealth Group Incorporated’s
Annual Report on Form 10-K for the year ended December 31, 2021)
*10.15
Form of Agreement for Nonqualified Stock Option Award to Executives under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (incorporated by reference to Exhibit 10.3 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2021)
*10.16
Form of Agreement for Performance-Based Restricted Stock Unit Award to Executives under UnitedHealth
Group Incorporated’s 2020 Stock Incentive Plan (incorporated by reference to Exhibit 10.4 to UnitedHealth
Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2021)
*10.17
Form of Agreement for Restricted Stock Unit Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (incorporated by reference to Exhibit 10.5 to UnitedHealth Group Incorporated’s Annual
Report on Form 10-K for the year ended December 31, 2021)
*10.18
Form of Agreement for Nonqualified Stock Option Award under UnitedHealth Group Incorporated’s 2020 Stock
Incentive Plan (Witty) (incorporated by reference to Exhibit 10.6 to UnitedHealth Group Incorporated’s Annual
Report on Form 10-K for the year ended December 31, 2021)
*10.19
Form of Agreement for Performance-Based Restricted Stock Unit Award under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (Witty) (incorporated by reference to Exhibit 10.7 to UnitedHealth
Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2021)
*10.20
UnitedHealth Group Incorporated 2011 Stock Incentive Plan, as amended and restated in 2018 (incorporated by
reference to Exhibit 10.1 to UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended
December 31, 2018)
*10.21
Form of Agreement for Non-Qualified Stock Option Award to Executives under UnitedHealth Group
Incorporated’s 2011 Stock Incentive Plan, as amended and restated in 2015, for awards made after January 1,
2016 (incorporated by reference to Exhibit 10.4 to UnitedHealth Group Incorporated’s Quarterly Report on Form
10-Q for the quarter ended September 30, 2015)
*10.22
Form of Agreement for Restricted Stock Unit Award to Executives under UnitedHealth Group Incorporated’s
2011 Stock Incentive Plan, as amended and restated in 2015, for awards made after January 1, 2016 (incorporated
by reference to Exhibit 10.5 to UnitedHealth Group Incorporated’s Quarterly Report on Form 10-Q for the quarter
ended September 30, 2015)
*10.23
Form of Agreement for Performance-based Restricted Stock Unit Award to Executives under UnitedHealth
Group Incorporated’s 2011 Stock Incentive Plan, as amended and restated in 2015, for awards made after January
1, 2016 (incorporated by reference to Exhibit 10.6 to UnitedHealth Group Incorporated’s Quarterly Report on
Form 10-Q for the quarter ended September 30, 2015)
72
*10.24
Form of Agreement for Deferred Stock Unit Award to Non-Employee Directors under UnitedHealth Group
Incorporated’s 2011 Stock Incentive Plan (incorporated by reference to Exhibit 10.6 to UnitedHealth Group
Incorporated’s Current Report on Form 8-K filed on May 27, 2011)
*10.25
Form of Agreement for Deferred Stock Unit Award to Non-Employee Directors under UnitedHealth Group
Incorporated’s 2020 Stock Incentive Plan (incorporated by reference to Exhibit 10.11 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2021)
*10.26
Form of Indemnification Agreement (incorporated by reference to Exhibit 10.1 to UnitedHealth Group
Incorporated’s Current Report on Form 8-K filed on July 1, 2015)
*10.27
Amended and Restated UnitedHealth Group Incorporated 2008 Executive Incentive Plan, effective as of
December 31, 2023 (incorporated by reference to exhibit 10.30 to UnitedHealth Group Incorporated’s Annual
Report on Form 10-K for the year ended December 31, 2023)
*10.28
UnitedHealth Group Executive Savings Plan (2024 Statement) (incorporated by reference to Exhibit 10.31 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2023)
*10.29
Executive Long-Term Disability Program, dated as of January 1, 2021 (incorporated by reference to Exhibit 10.28
to UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.30
Summary of Non-Management Director Compensation, effective as of October 1, 2022 (incorporated by
reference to Exhibit 10.29 to UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended
December 31, 2022)
*10.31
UnitedHealth Group Directors’ Compensation Deferral Plan (2023 Statement) (incorporated by reference to
Exhibit 10.30 to UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December
31, 2022)
*10.32
Avery Parent Holdings, Inc. 2020 Stock Option and Grant Plan (incorporated by reference to Exhibit 10.31 to
UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2022)
*10.33
Change Healthcare Inc. 2019 Omnibus Incentive Plan (incorporated by reference to Exhibit 4.3 to UnitedHealth
Group Incorporated’s Registration Statement on Form S-8, SEC File Number 333-267716, filed on October 3,
2022)
*10.34
Amended and Restated HCIT Holdings, Inc. 2009 Equity Incentive Plan (incorporated by reference to Exhibit 4.4
to UnitedHealth Group Incorporated’s Registration Statement on Form S-8, SEC File Number 333-267716, filed
on October 3, 2022)
*10.35
Audax Health Solutions, Inc. 2010 Equity Incentive Plan, as amended (incorporated by reference to Exhibit 4.4 to
UnitedHealth Group Incorporated’s Post-Effective Amendment No. 1 to Registration Statement on Form S-8,
SEC File Number 333-205826, filed on February 15, 2017)
*10.36
Surgical Care Affiliates, Inc. 2016 Omnibus Long-Term Incentive Plan (incorporated by reference to Exhibit 4.3
to UnitedHealth Group Incorporated’s Post-Effective Amendment No. 1 on Form S-8 to Registration Statement
on Form S-4, SEC File Number 333-216153, filed on March 27, 2017)
*10.37
Surgical Care Affiliates, Inc. 2013 Omnibus Long-Term Incentive Plan (incorporated by reference to Exhibit 4.4
to UnitedHealth Group Incorporated’s Post-Effective Amendment No. 1 on Form S-8 to Registration Statement
on Form S-4, SEC File Number 333-216153, filed on March 27, 2017)
*10.38
Surgical Care Affiliates, Inc. Management Equity Incentive Plan (incorporated by reference to Exhibit 4.5 to
UnitedHealth Group Incorporated’s Post-Effective Amendment No. 1 on Form S-8 to Registration Statement on
Form S-4, SEC File Number 333-216153, filed on March 27, 2017)
*10.39
Surgical Care Affiliates, Inc. Directors and Consultants Equity Incentive Plan (incorporated by reference to
Exhibit 4.6 to UnitedHealth Group Incorporated’s Post-Effective Amendment No. 1 on Form S-8 to Registration
Statement on Form S-4, SEC File Number 333-216153, filed on March 27, 2017)
*10.40
The Advisory Board Company Amended and Restated 2009 Stock Incentive Plan (incorporated by reference to
Exhibit 10.1 to The Advisory Board Company’s Current Report on Form 8-K filed on June 15, 2015)
*10.41
The Advisory Board Company 2005 Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to The
Advisory Board Company’s Current Report on Form 8-K filed on November 17, 2005)
*10.42
Amended and Restated Employment Agreement, effective as of June 7, 2016, between United HealthCare
Services, Inc. and John Rex (incorporated by reference to Exhibit 10.1 to UnitedHealth Group Incorporated’s
Quarterly Report on Form 10-Q for the quarter ended June 30, 2016)
*10.43
Amended and Restated Employment Agreement, dated February 3, 2021, between the Company and Andrew P
Witty (incorporated by reference to Exhibit 5.02 to UnitedHealth Group Incorporated’s Current Report on Form
8-K filed on February 8, 2021)
*10.44
Amended and Restated Employment Agreement, effective as of February 12, 2018, between United HealthCare
Services, Inc. and Brian R. Thompson (incorporated by reference to Exhibit 10.38 to UnitedHealth Group
Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2021)
*10.45
Amended and Restated Employment Agreement, effective as of April 1, 2024, between United HealthCare
Services, Inc. and Heather Cianfrocco
73
*10.46
Employment Agreement, effective as of January 9, 2017, between United HealthCare Services, Inc. and Erin
McSweeney
*10.47
Amendment to Employment Agreement, effective as of March 1, 2021, between United HealthCare Services, Inc.
and Erin McSweeney
*10.48
Amended and Restated Employment Agreement, effective as of June 4, 2024, between United HealthCare
Services, Inc. and Christopher Zaetta
19.1
Insider Trading Policy
21.1
Subsidiaries of UnitedHealth Group Incorporated
23.1
Consent of Independent Registered Public Accounting Firm
24.1
Power of Attorney
31.1
Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1
UnitedHealth Group Dodd-Frank Clawback Policy, effective December 1, 2023 (incorporated by reference to
Exhibit 97.1 to UnitedHealth Group Incorporated’s Annual Report on Form 10-K for the year ended December
31, 2023)
101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL
tags are embedded within the Inline XBRL document.
101.SCH Inline XBRL Taxonomy Extension Schema Document.
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104
Cover Page Interactive Data File (formatted as Inline XBRL and embedded within Exhibit 101).
________________________________________________
*
Denotes management contracts and compensation plans in which certain directors and named executive officers
participate and which are being filed pursuant to Item 601(b)(10)(iii)(A) of Regulation S-K.
**
Pursuant to Item 601(b)(4)(iii) of Regulation S-K, copies of instruments defining the rights of certain holders of
long-term debt are not filed. The Company will furnish copies thereof to the SEC upon request.
(c)
Financial Statement Schedule
Schedule I - Condensed Financial Information of Registrant (Parent Company Only).
74
Schedule I
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of UnitedHealth Group Incorporated and Subsidiaries:
Opinion on the Financial Statement Schedule
We have audited the consolidated financial statements of UnitedHealth Group Incorporated and Subsidiaries (the “Company”)
as of December 31, 2024 and 2023, and for each of the three years in the period ended December 31, 2024, and the Company’s
internal control over financial reporting as of December 31, 2024, and have issued our reports thereon dated February 27, 2025;
such reports are included elsewhere in this Form 10-K. Our audits also included the financial statement schedule of the
Company listed in the Index at Item 15. This financial statement schedule is the responsibility of the Company’s management.
Our responsibility is to express an opinion on the Company’s financial statement schedule based on our audits. In our opinion,
the financial statement schedule, when considered in relation to the consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.
/s/ DELOITTE & TOUCHE LLP
Minneapolis, Minnesota
February 27, 2025
75
Schedule I
Condensed Financial Information of Registrant
(Parent Company Only)
UnitedHealth Group
Condensed Balance Sheets
(in millions, except per share data)
December 31,
2024
December 31,
2023
Assets
Current assets:
Cash and cash equivalents ........................................................................................
$
234 $
776
Other current assets ...................................................................................................
411
570
Total current assets ..........................................................................................................
645
1,346
Equity in net assets of subsidiaries ..................................................................................
179,209
153,692
Long-term notes receivable from subsidiaries .................................................................
6,062
5,693
Other assets ......................................................................................................................
920
831
Total assets ......................................................................................................................
$
186,836 $
161,562
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and accrued liabilities ..................................................................
$
1,501 $
1,116
Short-term notes payable to subsidiaries ..................................................................
2,016
9,887
Short-term borrowings and current maturities of long-term debt .............................
4,348
4,086
Total current liabilities .....................................................................................................
7,865
15,089
Long-term debt, less current maturities ...........................................................................
71,831
57,387
Long-term notes payable to subsidiaries ..........................................................................
14,405
—
Other liabilities .................................................................................................................
77
330
Total liabilities .................................................................................................................
94,178
72,806
Commitments and contingencies (Note 4)
Shareholders’ equity:
Preferred stock, $0.001 par value -10 shares authorized; no shares issued or
outstanding ............................................................................................................
—
—
Common stock, $0.01 par value - 3,000 shares authorized; 915 and 924 issued
and outstanding .....................................................................................................
9
9
Retained earnings ......................................................................................................
96,036
95,774
Accumulated other comprehensive loss ...................................................................
(3,387)
(7,027)
Total UnitedHealth Group shareholders’ equity ..............................................................
92,658
88,756
Total liabilities and shareholders’ equity ....................................................................
$
186,836 $
161,562
See Notes to the Condensed Financial Statements of Registrant
76
Schedule I
Condensed Financial Information of Registrant
(Parent Company Only)
UnitedHealth Group
Condensed Statements of Comprehensive Income
For the Years Ended December 31,
(in millions)
2024
2023
2022
Revenues:
Investment and other income ..................................................................
$
368 $
312 $
255
Total revenues ................................................................................................
368
312
255
Operating costs:
Operating costs .......................................................................................
108
35
121
Interest expense ......................................................................................
4,544
3,469
2,110
Total operating costs ......................................................................................
4,652
3,504
2,231
Loss before income taxes .............................................................................
(4,284)
(3,192)
(1,976)
Benefit for income taxes ................................................................................
1,032
654
429
Loss of parent company ...............................................................................
(3,252)
(2,538)
(1,547)
Equity in undistributed income of subsidiaries ..............................................
17,657
24,919
21,667
Net earnings ..................................................................................................
14,405
22,381
20,120
Other comprehensive income (loss) ..............................................................
3,640
1,366
(3,009)
Comprehensive income ................................................................................
$
18,045 $
23,747 $
17,111
See Notes to the Condensed Financial Statements of Registrant
77
Schedule I
Condensed Financial Information of Registrant
(Parent Company Only)
UnitedHealth Group
Condensed Statements of Cash Flows
For the Years Ended December 31,
(in millions)
2024
2023
2022
Operating activities
Cash flows from operating activities ............................................................................
$
4,852 $
17,443 $
14,754
Investing activities
Issuances of notes to subsidiaries .................................................................................
(349)
(41)
(567)
Repayments of notes to subsidiaries ............................................................................
225
817
281
Cash paid for acquisitions and other transactions ........................................................
(13,750)
(8,144)
(20,728)
Return of capital to parent company ............................................................................
21
639
1,424
Capital contributions to subsidiaries ............................................................................
—
(2,472)
(570)
Cash received from dispositions, net ............................................................................
2,444
624
2,787
Other, net ......................................................................................................................
30
286
—
Cash flows used for investing activities .......................................................................
(11,379)
(8,291)
(17,373)
Financing activities
Common stock repurchases ..........................................................................................
(9,000)
(8,000)
(7,000)
Proceeds from common stock issuances ......................................................................
1,846
1,353
1,253
Cash dividends paid .....................................................................................................
(7,533)
(6,761)
(5,991)
(Repayments of) proceeds from short-term borrowings, net .......................................
(151)
11
732
Proceeds from issuance of long-term debt ...................................................................
17,811
6,394
14,819
Repayments of long-term debt .....................................................................................
(3,000)
(2,125)
(3,015)
(Repayments of) proceeds from short-term notes from subsidiaries, net .....................
(7,966)
1,188
594
Proceeds from long-term notes from subsidiaries ........................................................
14,396
—
—
Repayments of long-term notes from subsidiaries .......................................................
(28)
—
—
Other, net ......................................................................................................................
(390)
(702)
(674)
Cash flows from (used for) financing activities ...........................................................
5,985
(8,642)
718
(Decrease) increase in cash and cash equivalents ....................................................
(542)
510
(1,901)
Cash and cash equivalents, beginning of period ......................................................
776
266
2,167
Cash and cash equivalents, end of period ................................................................
$
234 $
776 $
266
Supplemental cash flow disclosures
Cash paid for interest ....................................................................................................
$
4,241 $
3,257 $
1,969
Cash paid for income taxes ..........................................................................................
2,450
4,426
4,298
See Notes to the Condensed Financial Statements of Registrant
78
Schedule I
Condensed Financial Information of Registrant
(Parent Company Only)
UnitedHealth Group
Notes to Condensed Financial Statements
1. Basis of Presentation
UnitedHealth Group’s parent company financial information has been derived from its consolidated financial statements and
should be read in conjunction with the consolidated financial statements included in this Form 10-K. The accounting policies
for the registrant are the same as those described in Note 2 of the Notes to the Consolidated Financial Statements included in
Part II, Item 8, “Financial Statements and Supplementary Data.”
2. Subsidiary Transactions
Investment in Subsidiaries. UnitedHealth Group’s investment in subsidiaries is stated at cost plus equity in undistributed
earnings of subsidiaries.
Dividends and Capital Distributions. Cash dividends received from subsidiaries and included in Cash Flows from Operating
Activities in the Condensed Statements of Cash Flows were $19.3 billion, $18.5 billion and $15.6 billion in 2024, 2023 and
2022, respectively. Additionally, $21 million, $639 million and $1.4 billion in cash were received as a return of capital to the
parent company during 2024, 2023 and 2022, respectively.
3. Short-Term Borrowings and Long-Term Debt
Discussion of short-term borrowings and long-term debt can be found in Note 8 of the Notes to the Consolidated Financial
Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.” Long-term debt obligations of the
parent company do not include other financing obligations at subsidiaries which totaled $0.7 billion and $1.1 billion at
December 31, 2024 and 2023.
Maturities of short-term borrowings and long-term debt for the years ending December 31 are as follows:
(in millions)
2025 ..........................................................................................................................................................................
$
4,350
2026 ..........................................................................................................................................................................
3,650
2027 ..........................................................................................................................................................................
3,425
2028 ..........................................................................................................................................................................
3,000
2029 ..........................................................................................................................................................................
3,550
Thereafter ..................................................................................................................................................................
59,802
UnitedHealth Group’s parent company had short-term notes payable to subsidiaries of $2.0 billion and $9.9 billion as of
December 31, 2024 and 2023, respectively, which included on-demand features. UnitedHealth Group’s parent company had
long-term notes payable to subsidiaries of $14.4 billion as of December 31, 2024.
4. Commitments and Contingencies
Certain subsidiaries are guaranteed by UnitedHealth Group’s parent company in the event of insolvency. UnitedHealth Group’s
parent company also provides guarantees related to its service level under certain contracts. None of the amounts accrued, paid
or charged to income for service level guarantees were material as of December 31, 2024, 2023 or 2022.
For a summary of commitments and contingencies, see Note 12 of the Notes to the Consolidated Financial Statements included
in Part II, Item 8, “Financial Statements and Supplementary Data.”
ITEM 16.
FORM 10-K SUMMARY
None.
79
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: February 27, 2025
UNITEDHEALTH GROUP INCORPORATED
By
/s/ ANDREW WITTY
Andrew Witty
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ ANDREW WITTY
Director and Chief Executive Officer
(principal executive officer)
February 27, 2025
Andrew Witty
/s/ JOHN REX
President and Chief Financial Officer
(principal financial officer)
February 27, 2025
John Rex
/s/ THOMAS ROOS
Senior Vice President and
Chief Accounting Officer
(principal accounting officer)
February 27, 2025
Thomas Roos
*
Director
February 27, 2025
Charles Baker
*
Director
February 27, 2025
Timothy Flynn
*
Director
February 27, 2025
Paul Garcia
*
Director
February 27, 2025
Kristen Gil
*
Director
February 27, 2025
Stephen Hemsley
*
Director
February 27, 2025
Michele Hooper
*
Director
February 27, 2025
F. William McNabb III
*
Director
February 27, 2025
Valerie Montgomery Rice, M.D.
*
Director
February 27, 2025
John Noseworthy, M.D.
*By
/s/ CHRISTOPHER ZAETTA
Christopher Zaetta
As Attorney-in-Fact
80