• Revenues of $80.9 Billion Grew 12% Year-Over-Year, with Diversified Growth across Optum and UnitedHealthcare
  • Earnings from Operations were $7.5 Billion
  • Cash Flows from Operations were $18.5 Billion; Adjusted Cash Flows from Operations were $8.8 Billion, 1.6x Net Income
  • Net Earnings $5.55 Per Share; Adjusted Earnings $5.79 Per Share

Strong and well-balanced performance continued across UnitedHealth Group (NYSE: UNH) in the third quarter of 2022.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20221014005099/en/

UnitedHealth Group Corporate Headquarters (Photo: Business Wire)

“The strength of our performance reflects the diligence and determination of our colleagues to improve people’s experience across the health care system and make high-quality care simpler, more accessible and more affordable,” said Andrew Witty, chief executive officer of UnitedHealth Group.

Growth in the third quarter was driven by continued expansion in the number of people served throughout UnitedHealthcare and in the value-based care initiatives at Optum Health. The company increased its full year 2022 net earnings outlook to $20.85 to $21.05 per share and adjusted net earnings to $21.85 to $22.05 per share.

Quarterly Financial Performance

 

Three Months Ended

 

 

September 30,

2022

September 30,

2021

June 30,

2022

 

 

Revenues

$80.9 billion

$72.3 billion

$80.3 billion

Earnings from Operations

$ 7.5 billion

$ 5.7 billion

$ 7.1 billion

Net Margin

6.5%

5.6%

6.3%

  • UnitedHealth Group’s third quarter 2022 revenues were $80.9 billion, growth of $8.6 billion or 12% year-over-year, reflecting double-digit growth at both Optum and UnitedHealthcare.
  • Third quarter 2022 earnings from operations were $7.5 billion, growth of 31% year-over-year, with strong contributions from both Optum and UnitedHealthcare. Adjusted net earnings of $5.79 per share increased 28% compared to the third quarter of 2021.
  • The third quarter 2022 medical care ratio was 81.6% compared to 81.5% in the second quarter 2022 and 83.0% in the third quarter of 2021, due to COVID effects and business mix. Favorable medical reserve development of $870 million compared to $890 million in the second quarter 2022 and $700 million in the year ago third quarter. Days claims payable were 50.8, compared to 50.6 in the second quarter of 2022 and 50.4 in the third quarter of 2021.
  • The third quarter 2022 operating cost ratio of 14.4% compares to 14.6% in the second quarter 2022 and 14.8% in the year ago quarter, reflecting continued productivity gains, offset by business mix and investments in growth initiatives.
  • Adjusted cash flows from operations for the third quarter 2022 were $8.8 billion or 1.6-times net income, excluding the impact of October CMS payments received in September. Year-to-date, the company has returned $10.5 billion to shareholders through dividends and share repurchases. Return on equity of 28.5% in the quarter reflected the company’s sustained growth and efficient capital structure.

UnitedHealthcare provides health care benefits globally, serving individuals and employers, and Medicare and Medicaid beneficiaries. UnitedHealthcare is dedicated to improving the value customers and consumers receive by improving health and wellness, enhancing the quality of care received, simplifying the health care experience and reducing the total cost of care.

Quarterly Financial Performance

 

Three Months Ended

 

September 30,

2022

September 30,

2021

June 30,

2022

 

 

Revenues

$62.0 billion

$55.9 billion

$62.1 billion

Earnings from Operations

$ 3.8 billion

$ 2.7 billion

$ 3.9 billion

Operating Margin

6.1%

4.7%

6.2%

  • UnitedHealthcare third quarter revenues of $62.0 billion grew $6.1 billion or 11% year-over-year, reflecting broad-based growth.
  • Third quarter 2022 operating earnings were $3.8 billion compared to $2.7 billion last year, reflecting growth in people served, COVID effects, and continued medical and operating cost management.
  • Total people served domestically by UnitedHealthcare has grown by approximately 850,000 in 2022, including 185,000 in the third quarter. Growth was led by UnitedHealthcare’s community-based and senior offerings. The number of people served with domestic commercial benefit insurance offerings has grown by more than 100,000 over the past six months.

Optum’s health services businesses serve the global health care marketplace, including payers, care providers, employers, governments, life sciences companies and consumers. Using market-leading information, analytics, technology and clinical insights, Optum helps improve overall health system performance: optimizing care quality, reducing care costs and improving the consumer experience.

Quarterly Financial Performance

 

Three Months Ended

 

September 30,

2022

September 30,

2021

June 30,

2022

 

Revenues

$46.6 billion

$39.8 billion

$45.1 billion

 

Earnings from Operations

$ 3.7 billion

$ 3.1 billion

$ 3.3 billion

 

Operating Margin

7.9%

7.7%

7.3%

 

  • Optum third quarter revenues of $46.6 billion grew $6.8 billion or 17% year-over-year, led by Optum Health. Operating earnings were $3.7 billion compared to $3.1 billion last year.
  • Optum Health revenue per consumer served increased 31% over the year ago period, driven by growth in value-based care arrangements and continued expansion of care delivery platforms, including in-home, clinic-based, ambulatory surgery, behavioral and digital.
  • Optum Insight revenue grew 18% in the third quarter led by the growth of payer and provider services. Revenue backlog increased by $1.8 billion over the year ago period to $24.1 billion. The combination with Change Healthcare was completed at the beginning of the fourth quarter 2022 and will accelerate efforts to better connect and simplify the core clinical, administrative and payment processes health care providers and payers depend on to serve patients.
  • Optum Rx’s revenue growth of 8% in the third quarter reflects the impact of serving new clients and further expansion of pharmacy care services offerings, including specialty and community pharmacy. Adjusted scripts grew to 359 million compared to 344 million last year.

About UnitedHealth Group

UnitedHealth Group (NYSE: UNH) 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 through two distinct and complementary businesses. Optum delivers care aided by technology and data, empowering people, partners and providers with the guidance and tools they need to achieve better health. UnitedHealthcare offers a full range of health benefits, enabling affordable coverage, simplifying the health care experience and delivering access to high-quality care. Visit UnitedHealth Group at www.unitedhealthgroup.com and follow @UnitedHealthGrp on Twitter.

Earnings Conference Call

As previously announced, UnitedHealth Group will discuss the company’s results, strategy and future outlook on a conference call with investors at 8:45 a.m. Eastern Time today. UnitedHealth Group will host a live webcast of this conference call from the Investor Relations page of the company’s website (www.unitedhealthgroup.com). Following the call, a webcast replay will be on the Investor Relations page and at https://uhg.co/Replay through October 28, 2022. This earnings release and the Form 8-K dated October 14, 2022, can also be accessed from the Investor Relations page of the company’s website.

Non-GAAP Financial Information

This news release presents non-GAAP financial information provided as a complement to the results provided in accordance with accounting principles generally accepted in the United States of America (“GAAP”). A reconciliation of the non-GAAP financial information to the most directly comparable GAAP financial measure is provided in the accompanying tables found at the end of this release.

Forward-Looking Statements

The statements, estimates, projections, guidance or outlook contained in this document include “forward-looking” statements which are intended to take advantage of the “safe harbor” provisions of the federal securities law. The words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “forecast,” “outlook,” “plan,” “project,” “should” and similar expressions identify forward-looking statements. These statements may contain information about financial prospects, economic conditions and trends and involve risks and uncertainties. Actual results could differ materially from those that management expects, depending on the outcome of certain factors including: risks associated with public health crises, large-scale medical emergencies and pandemics, such as the COVID-19 pandemic; our ability to effectively estimate, price for and manage medical costs; new or changes in existing health care laws or regulations, or their enforcement or application; the DOJ’s legal action relating to the risk adjustment submission matter; our ability to maintain and achieve improvement in quality scores impacting revenue; reductions in revenue or delays to cash flows received under government programs; changes in Medicare, the CMS star ratings program or the application of risk adjustment data validation audits; failure to maintain effective and efficient information systems or if our technology products do not operate as intended; cyberattacks, other privacy/data security incidents, or our failure to comply with related regulations; failure to protect proprietary rights to our databases, software and related products; risks and uncertainties associated with our businesses providing pharmacy care services; competitive pressures, including our ability to develop and deliver innovative products to health care payers and expand access to virtual care; changes in or challenges to our public sector contract awards; failure to develop and maintain satisfactory relationships with health care payers, physicians, hospitals and other service providers; failure to attract, develop, retain, and manage the succession of key employees and executives; the impact of potential changes in tax laws and regulations (including any increase in the U.S. income tax rate applicable to corporations); failure to achieve targeted operating cost productivity improvements; increases in costs and other liabilities associated with litigation, government investigations, audits or reviews; failure to manage successfully our strategic alliances or complete or receive anticipated benefits of strategic transactions; fluctuations in foreign currency exchange rates; downgrades in our credit ratings; our investment portfolio performance; impairment of our goodwill and intangible assets; and our ability to obtain sufficient funds from our regulated subsidiaries or from external financings to fund our obligations, maintain our debt to total capital ratio at targeted levels, maintain our quarterly dividend payment cycle, or continue repurchasing shares of our common stock. This above list is not exhaustive. We discuss these matters, and certain risks that may affect our business operations, financial condition and results of operations more fully in our filings with the SEC, including our reports on Forms 10-K, 10-Q and 8-K. By their nature, forward-looking statements are not guarantees of future performance or results and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Actual results may vary materially from expectations expressed or implied in this document or any of our prior communications. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. We do not undertake to update or revise any forward-looking statements, except as required by law.

UNITEDHEALTH GROUP   Earnings Release Schedules and Supplementary Information Quarter Ended September 30, 2022   - Condensed Consolidated Statements of Operations   - Condensed Consolidated Balance Sheets   - Condensed Consolidated Statements of Cash Flows   - Supplemental Financial Information - Businesses   - Supplemental Financial Information - Business Metrics   - Reconciliation of Non-GAAP Financial Measures UNITEDHEALTH GROUP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (unaudited)  

Three Months Ended September 30,

 

Nine Months Ended September 30,

2022

 

2021

 

2022

 

2021

Revenues Premiums

$

64,491

 

$

56,967

 

$

192,457

 

$

168,686

 

Products

 

9,190

 

 

8,703

 

 

28,026

 

 

25,476

 

Services

 

6,700

 

 

6,164

 

 

19,717

 

 

18,181

 

Investment and other income

 

513

 

 

503

 

 

1,175

 

 

1,511

 

  Total revenues

 

80,894

 

 

72,337

 

 

241,375

 

 

213,854

 

  Operating costs Medical costs

 

52,635

 

 

47,302

 

 

157,251

 

 

138,752

 

Operating costs

 

11,663

 

 

10,725

 

 

34,773

 

 

31,307

 

Cost of products sold

 

8,306

 

 

7,802

 

 

25,389

 

 

23,034

 

Depreciation and amortization

 

828

 

 

796

 

 

2,418

 

 

2,332

 

  Total operating costs

 

73,432

 

 

66,625

 

 

219,831

 

 

195,425

 

  Earnings from operations

 

7,462

 

 

5,712

 

 

21,544

 

 

18,429

 

  Interest expense

 

(516

)

 

(422

)

 

(1,416

)

 

(1,229

)

  Earnings before income taxes

 

6,946

 

 

5,290

 

 

20,128

 

 

17,200

 

  Provision for income taxes

 

(1,562

)

 

(1,099

)

 

(4,397

)

 

(3,659

)

  Net earnings

 

5,384

 

 

4,191

 

 

15,731

 

 

13,541

 

  Earnings attributable to noncontrolling interests

 

(122

)

 

(105

)

 

(372

)

 

(327

)

  Net earnings attributable to UnitedHealth Group common shareholders

$

5,262

 

$

4,086

 

$

15,359

 

$

13,214

 

  Diluted earnings per share attributable to UnitedHealth Group common shareholders

$

5.55

 

$

4.28

 

$

16.15

 

$

13.82

 

  Adjusted earnings per share attributable to UnitedHealth Group common shareholders (a)

$

5.79

 

$

4.52

 

$

16.85

 

$

14.54

 

  Diluted weighted-average common shares outstanding

 

948

 

 

955

 

 

951

 

 

956

 

 

(a) See page 6 for a reconciliation of the non-GAAP measure

UNITEDHEALTH GROUP CONDENSED CONSOLIDATED BALANCE SHEETS (in millions) (unaudited)  

September 30,

 

December 31,

2022

 

2021

Assets Cash and short-term investments

$

42,527

$

23,907

Accounts receivable, net

 

17,047

 

14,216

Other current assets

 

23,363

 

23,635

  Total current assets

 

82,937

 

61,758

  Long-term investments

 

41,557

 

43,114

Other long-term assets

 

118,570

 

107,334

  Total assets

$

243,064

$

212,206

    Liabilities, redeemable noncontrolling interests and equity Medical costs payable

$

29,064

$

24,483

Short-term borrowings and current maturities of long-term debt

 

3,229

 

3,620

Other current liabilities

 

68,642

 

50,189

  Total current liabilities

 

100,935

 

78,292

  Long-term debt, less current maturities

 

45,438

 

42,383

Other long-term liabilities

 

13,770

 

15,052

Redeemable noncontrolling interests

 

4,857

 

1,434

Equity

 

78,064

 

75,045

  Total liabilities, redeemable noncontrolling interests and equity

$

243,064

$

212,206

UNITEDHEALTH GROUP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (unaudited)  

Nine Months Ended September 30,

2022

2021

Operating Activities Net earnings

$

15,731

 

$

13,541

 

Noncash items: Depreciation and amortization

 

2,418

 

 

2,332

 

Deferred income taxes and other

 

(590

)

 

178

 

Share-based compensation

 

675

 

 

591

 

Net changes in operating assets and liabilities

 

12,505

 

 

2,483

 

  Cash flows from operating activities

 

30,739

 

 

19,125

 

  Investing Activities Purchases of investments, net of sales and maturities

 

(4,067

)

 

(3,702

)

Purchases of property, equipment and capitalized software

 

(1,936

)

 

(1,759

)

Cash paid for acquisitions, net

 

(7,154

)

 

(4,727

)

Other, net

 

50

 

 

(900

)

  Cash flows used for investing activities

 

(13,107

)

 

(11,088

)

  Financing Activities Common share repurchases

 

(6,000

)

 

(3,950

)

Dividends paid

 

(4,450

)

 

(3,915

)

Net change in short-term borrowings and long-term debt

 

3,806

 

 

3,733

 

Other, net

 

6,478

 

 

304

 

  Cash flows used for financing activities

 

(166

)

 

(3,828

)

  Effect of exchange rate changes on cash and cash equivalents

 

4

 

 

(45

)

  Increase in cash and cash equivalents

 

17,470

 

 

4,164

 

  Cash and cash equivalents, beginning of period

 

21,375

 

 

16,921

 

  Cash and cash equivalents, end of period

$

38,845

 

$

21,085

 

UNITEDHEALTH GROUP SUPPLEMENTAL FINANCIAL INFORMATION - BUSINESSES (in millions, except percentages) (unaudited)  

Three Months Ended September 30,

 

Nine Months Ended September 30,

2022

 

2021

 

2022

 

2021

Revenues UnitedHealthcare

$

61,995

 

$

55,927

 

$

186,695

 

$

166,515

 

Optum

 

46,559

 

 

39,785

 

 

134,900

 

 

114,472

 

Eliminations

 

(27,660

)

 

(23,375

)

 

(80,220

)

 

(67,133

)

  Total consolidated revenues

$

80,894

 

$

72,337

 

$

241,375

 

$

213,854

 

  Earnings from Operations UnitedHealthcare

$

3,799

 

$

2,651

 

$

11,447

 

$

9,854

 

Optum (a)

 

3,663

 

 

3,061

 

 

10,097

 

 

8,575

 

  Total consolidated earnings from operations

$

7,462

 

$

5,712

 

$

21,544

 

$

18,429

 

  Operating Margin UnitedHealthcare

 

6.1

%

 

4.7

%

 

6.1

%

 

5.9

%

Optum

 

7.9

%

 

7.7

%

 

7.5

%

 

7.5

%

Consolidated operating margin

 

9.2

%

 

7.9

%

 

8.9

%

 

8.6

%

    Revenues UnitedHealthcare Employer & Individual - Domestic

$

15,929

 

$

15,094

 

$

47,318

 

$

44,668

 

UnitedHealthcare Employer & Individual - Global

 

2,120

 

 

2,139

 

 

6,500

 

 

6,292

 

UnitedHealthcare Employer & Individual - Total

 

18,049

 

 

17,233

 

 

53,818

 

 

50,960

 

UnitedHealthcare Medicare & Retirement

 

27,895

 

 

24,931

 

 

85,620

 

 

75,709

 

UnitedHealthcare Community & State

 

16,051

 

 

13,763

 

 

47,257

 

 

39,846

 

  Optum Health

$

18,463

 

$

13,812

 

$

52,728

 

$

39,515

 

Optum Insight

 

3,693

 

 

3,139

 

 

10,194

 

 

8,948

 

Optum Rx

 

25,203

 

 

23,337

 

 

73,919

 

 

67,465

 

Optum eliminations

 

(800

)

 

(503

)

 

(1,941

)

 

(1,456

)

(a) Earnings from operations for Optum for the three and nine months ended September 30, 2022 included $1,575 and $4,340 for Optum Health; $1,007 and $2,693 for Optum Insight; and $1,081 and $3,064 for Optum Rx, respectively. Earnings from operations for Optum for the three and nine months ended September 30, 2021 included $1,143 and $3,233 for Optum Health; $906 and $2,447 for Optum Insight; and $1,012 and $2,895 for Optum Rx, respectively. UNITEDHEALTH GROUP SUPPLEMENTAL FINANCIAL INFORMATION - BUSINESS METRICS   UNITEDHEALTHCARE CUSTOMER PROFILE (in thousands)   People Served September 30, 2022 June 30, 2022 December 31, 2021 September 30, 2021   Commercial - Domestic: Risk-based

 

8,055

 

8,010

 

7,985

 

7,960

Fee-based

 

18,500

 

18,480

 

18,595

 

18,595

  Total Commercial - Domestic

 

26,555

 

26,490

 

26,580

 

26,555

  Medicare Advantage

 

7,035

 

6,945

 

6,490

 

6,455

Medicaid

 

8,005

 

7,990

 

7,655

 

7,510

Medicare Supplement (Standardized)

 

4,370

 

4,355

 

4,395

 

4,405

  Total Community and Senior

 

19,410

 

19,290

 

18,540

 

18,370

Total UnitedHealthcare - Domestic Medical

 

45,965

 

45,780

 

45,120

 

44,925

  Commercial - Global

 

5,360

 

5,465

 

5,510

 

5,490

  Total UnitedHealthcare - Medical

 

51,325

 

51,245

 

50,630

 

50,415

    Supplemental Data   Medicare Part D stand-alone

 

3,310

 

3,330

 

3,700

 

3,725

    OPTUM PERFORMANCE METRICS   September 30, 2022 June 30, 2022 December 31, 2021 September 30, 2021   Optum Health Consumers Served (in millions)

 

101

 

101

 

100

 

99

Optum Insight Contract Backlog (in billions)

$

24.1

$

23.6

$

22.4

$

22.3

Optum Rx Quarterly Adjusted Scripts (in millions)

 

359

 

357

 

353

 

344

    Note: UnitedHealth Group served 149 million unique individuals across all businesses at September 30, 2022. UNITEDHEALTH GROUP RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (in millions, except per share data) (unaudited)       ADJUSTED NET EARNINGS PER SHARE(a)      

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

Projected Year Ended December 31,

2022

 

2021

 

2022

 

2021

 

2022

GAAP net earnings attributable to UnitedHealth Group common shareholders

$

5,262

 

 

$

4,086

 

$

15,359

 

 

$

13,214

 

$19,800 - $20,025 Intangible amortization

 

323

 

 

 

305

 

 

896

 

 

 

904

 

~1,290 Tax effect of intangible amortization

 

(92

)

 

 

(74

)

 

(233

)

 

 

(220

)

~(330) Adjusted net earnings attributable to UnitedHealth Group common shareholders

$

5,493

 

 

$

4,317

 

$

16,022

 

 

$

13,898

 

$20,750 - $20,975       GAAP diluted earnings per share

$

5.55

 

 

$

4.28

 

$

16.15

 

 

$

13.82

 

$20.85 - $21.05 Intangible amortization per share

 

0.34

 

 

 

0.32

 

 

0.94

 

 

 

0.95

 

~1.35 Tax effect per share of intangible amortization

 

(0.10

)

 

 

(0.08

)

 

(0.24

)

 

 

(0.23

)

~(0.35) Adjusted diluted earnings per share

$

5.79

 

 

$

4.52

 

$

16.85

 

 

$

14.54

 

$21.85 - $22.05                   ADJUSTED CASH FLOWS FROM OPERATIONS(a)       Three Months EndedSeptember 30, 2022   Nine Months EndedSeptember 30, 2022   GAAP cash flows from operations

$

18,549

 

 

$

30,739

 

  Less: October CMS premium payments received in September

 

(9,763

)

 

 

(9,763

)

  Adjusted cash flows from operations

$

8,786

 

 

$

20,976

 

  (a) Adjusted net earnings per share and adjusted cash flows from operations are non-GAAP financial measures. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, or superior to, financial measures prepared in accordance with GAAP.Adjusted net earnings per share excludes from the relevant GAAP metric, as applicable, intangible amortization and other items, if any, that do not relate to the Company's underlying business performance. Management believes that the use of adjusted net earnings per share provides investors and management useful information about the earnings impact of acquisition-related intangible asset amortization. As amortization fluctuates based on the size and timing of the Company’s acquisition activity, management believes this exclusion provides a more useful comparison of the Company's underlying business performance and trends from period to period. While intangible assets contribute to the Company’s revenue generation, the intangible amortization is not directly related. Therefore, the related revenues are included in adjusted earnings per share.Management believes the use of adjusted cash flows from operations provides investors and management with useful information to compare our cash flows from operations for the current period to other periods, when the Company does not receive its monthly payment from the Centers for Medicare and Medicaid Services (CMS) in the applicable quarter. CMS generally remits their monthly payments on the first calendar day of the applicable month. However, if the first calendar day of the month falls on a weekend or a holiday, CMS has typically paid the Company on the last business day of the preceding calendar month. Adjusted cash flows from operating activities presents operating cash flows assuming all CMS payments were received on the first calendar day of the applicable month.

 

Investor Contact: Zack Sopcak Senior Vice President 952-936-7215 zack.sopcak@uhg.com

Media Contact: Matt Stearns Senior Vice President 202-276-0085 matt.stearns@uhg.com

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