AP

Optum again a big revenue driver for UnitedHealth in 2021

Jan 18, 2022, 1:36 PM | Updated: Jan 19, 2022, 7:49 am

FILE - This Oct. 16, 2012, file photo, shows a portion of the UnitedHealth Group Inc.'s campus in M...

FILE - This Oct. 16, 2012, file photo, shows a portion of the UnitedHealth Group Inc.'s campus in Minnetonka, Minn. UnitedHealth Group posted strong fourth-quarter earnings led by double-digit growth in its Optum division. The largest U.S. health insurer posted fourth quarter net income Wednesday, Jan. 19, 2022, of $4.07 billion, or $4.26. (AP Photo/Jim Mone, File)

(AP Photo/Jim Mone, File)

UnitedHealth Group’s fourth-quarter profit soared as the nation’s largest health insurance provider branched deeper into offering care as well as covering the bills.

The health care giant said Wednesday that operating earnings from its Optum division grew nearly 10% to $3.4 billion in the quarter. Optum runs one of the nation’s largest pharmacy benefits managers and provides care through its Optum Health network of doctors, clinics and surgery centers.

That business served 100 million people last year and saw its revenue per customer increase by a third.

Operating earnings, which don’t count interest expense and taxes, also soared for the company’s UnitedHealthcare insurance side, which added more people through government-funded Medicare Advantage and Medicaid coverage. That business now covers more than 50 million people.

Company executives said Wednesday that COVID-19 costs were in line with expectations during the quarter and were balanced by a drop in doctor visits and other care.

A surge in cases from the omicron variant of the virus hit late in the quarter and has since bumped up patient hospitalization levels. But UnitedHealth said the severity of cases requiring hospitalization care seems to be lower so far.

Overall, UnitedHealth Group earned $4.07 billion in the final quarter of 2021, up from $2.21 billion the previous year.

Removing one-time benefits and charges, per-share earnings were $4.48, or 18 cents better than expected on Wall Street, according to a survey by Zacks Investment Research.

Revenue jumped more than 12% to $73.74 billion and also topped expectations.

UnitedHealth’s Optum Health business works with more than 60,000 physicians and runs primary, specialty and urgent care clinics as well as surgical sites.

The company said it pulled in more revenue per customer as it expanded and shifted more patients into value-based care. That involves reimbursing doctors and other care providers based more on how a patient does rather than for each service performed.

UnitedHealth and rivals like the drugstore chain and insurance provider CVS Health are moving more into providing care in an attempt to keep patients healthier and reduce expensive care like hospital stays.

That approach can bring in more revenue for the care providing side of their businesses while also cutting costs on the insurance side.

Overall, UnitedHealth booked $24 billion in operating earnings last year, with Optum contributing about half that total.

For 2022, the company reaffirmed its forecast for adjusted earnings of between $21.10 and $21.60 per share on revenue ranging from $317 billion to $320 billion.

Analysts expect, on average, earnings of $21.63 per share on $316.76 billion in revenue, according to FactSet.

UnitedHealth shares climbed 2% to $470.40 Wednesday while the Dow Jones Industrial Average, of which UnitedHealth is a component, rose slightly.

The price of UnitedHealth Group Inc. shares topped $500 for the first time late last year, setting a new all-time high for the Minnetonka, Minnesota, company.

_____

A portion of this story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on UNH at https://www.zacks.com/ap/UNH

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Image: A cargo ship is stuck under the part of the structure of the Francis Scott Key Bridge after ...

Associated Press

Authorities identify 2 bodies recovered at site of Baltimore bridge collapse

A major bridge in Baltimore snapped and collapsed after a container ship rammed into it early Tuesday, and several vehicles fell into the river below.

1 day ago

Photo: Mountaineer Jim Whittaker has died at 95....

Gene Johnson, The Associated Press

Lou Whittaker, among the most famous American mountaineers, has died at age 95

Lou Whittaker, a legendary American mountaineer who helped lead ascents of Mount Everest, K2 and Denali, has died at age 95.

1 day ago

File photo: Former Sen. Joe Lieberman speaks in Washington on Jan. 18, 2024....

Associated Press

Former Sen. Joe Lieberman, Democrats’ VP pick in 2000, dead at 82

Former U.S. Sen. Joe Lieberman of Connecticut, who nearly won the vice presidency on the Democratic ticket with Al Gore in 2000, has died.

2 days ago

islamic state attack...

Vanessa Gera, The Associated Press

What we know after the Islamic State group claims responsibility for Moscow massacre

The Islamic State group has claimed responsibility for an attack on a suburban Moscow concert hall that killed at least 133 people.

5 days ago

Moscow shooting...

The Associated Press

Russia: 60 dead, 145 injured in concert hall raid; Islamic State group claims responsibility

Assailants burst into a concert hall in Moscow on Friday and sprayed the crowd with gunfire, killing over 60 people, injuring more than 100.

7 days ago

Photo: Britain's Kate, Duchess of Cambridge visits 282 (East Ham) Squadron, RAF Air Cadets, Cornwel...

Associated Press

Kate Middleton announces she has cancer, is undergoing chemotherapy

Kate Middleton, Princess of Wales, says she is undergoing chemotherapy to treat cancer. She has been out of view since Christmas.

7 days ago

Optum again a big revenue driver for UnitedHealth in 2021