UnitedHealth Group Incorporated

Your program is about to begin. Good morning and welcome to the United Health Group fourth quarter and full year 2019 earnings conference call. A question and answer session will follow United Health Group's prepared remarks. As a reminder, this call is being recorded. Here is some important introductory information. This call contains forward-looking statements under U.S. federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. A description of some of the risks and uncertainties can be found in the reports that we file with the Securities and Exchange Commission, including the cautionary statements included in our current and periodic filings. This will also reference non-GAAP amounts. A reconciliation of the non-GAAP to GAAP amounts is available on the Financial Reports and SC Filings section of the company's investor's page at www.unitedhealthgroup.com. Information presented on this call is contained in the earnings release we issued this morning and in our Form 8K dated January 15, 2020, which may be accessed from the investor's page of the company's website. I will now turn the conference over to the Chief Executive Officer of UnitedHealth Group, David Whitman. Please go ahead.

Good morning, and thank you for joining us. Six weeks ago, we had the privilege of spending the day with many of you at our annual investor conference, providing an in-depth look at the accelerating opportunities we see to serve more people more deeply and to grow strongly into 2020 and well beyond. As we conclude 2019 and step into the new year, the performance of our business strengthens our confidence in the themes, opportunities, and outlooks of that day, as evidenced by today's results. we remain highly focused on driving affordability, innovating with consumer and customer responsive products and services, improving operating performance, and advancing NPS. Full year 2019 adjusted earnings per share were stronger than our investor conference outlook, growing 17% for the year to $15.11 per share. Full year revenues exceeded $242 billion growing $16 billion over 2018, with notable gains in our Medicare, care delivery, and pharmacy care services businesses. Full-year cash flows were $18.5 billion, or 1.3 times net income. We finished the year encouraged by continued performance improvement in Medicaid, early market interest in our new innovative line of employer-sponsored benefit offerings, and 2020 individual Medicare Advantage annual enrollment results, which were our strongest ever. Within our Medicare Advantage offerings, including dual eligible growth, we expect to serve nearly 700,000 more people in 2020, the upper end of the range of performance offered at our investor conference. Our fourth quarter medical and operating cost positions continued to improve, meaningfully enterprise-wide. with ample opportunity for further progress on both of these fronts. And our MPS improved nicely in 2019 across our businesses, particularly within network care providers, enrollees in Medicare Advantage and dual special needs plans, as well as patients served by our OptumCare and pharmacy care services businesses. Improved costs and higher satisfaction propelled by meaningful innovation allow us to contribute more comprehensively to the development and deployment of the kind of next-generation health system needed in the U.S. and globally, a more forward-looking, modern health system built around the people we serve, seamlessly woven into their lives, simple, convenient, transparent, and compassionate, a health system that is more affordable, creates a better experience for both patients and physicians, and improves health outcomes. The health system we are helping to build will better meet the personalized needs of people, It leverages the next generation data analytics, such as the individual health record, to empower patients and their doctors with actionable intelligence that drives next best actions to improve decision-making in real time. We are committed to a future where every person has access to high-quality, affordable health care that meets their unique health care needs and financial means. We're employing specific actions to help achieve this. driving better health outcomes and aiming ultimately to reduce the health care cost trend to general inflation levels, even with an aging, more chronically ill population. Notably, the bipartisan repeal of the ACA taxes in December was a strong step towards improving affordability for Americans. It will greatly assist those who have been most affected by the cost of those taxes, especially seniors, small employers, and those who are individually insured. As we continue to do better for those we serve, we will grow, helping improve the health system one person at a time, intensely focused on driving improved consumer and physician experiences. Looking to the years ahead, our strengthening capabilities and diversified complementary businesses Operating in the large, growing healthcare market positioned us well to achieve our long-term adjusted earnings per share growth rate objective of 13% to 16%. While we continue, as always, to invest in the future for sustainable market-leading performance and advancing shareholder returns. With that, let me turn it to UnitedHealth Group President and Optum Chief Executive Officer Andrew Witte to discuss Optum's results and momentum heading into the new year.

Thank you, Dave. At Optum, we're encouraged and humbled by the expanding opportunities to grow and serve more people more deeply. There's a distinct energy and eagerness across our businesses as we enter 2020. In 2019, Optum revenues reached $113 billion, growing 12% year over year. Total operating earnings grew 14% to $9.4 billion. Optum Health revenues reached $30.3 billion in 2019, up 26%, led by OptumCare, our care delivery business. We're steadily expanding into new geographies and expanding the depth and breadth of services in existing regions to better provide patients with the highest quality, convenient, and affordable health services. One measure that helped illustrate how we are serving people more comprehensively is revenue per consumer served, which grew 26% in the quarter. This measure will continue strongly advancing as we further build out our integrated care delivery network. Turning to OptumRx, revenues of $74.3 billion grew 7%, even with the previously discussed impact of a single large customer transition. The 2020 selling season for core pharmacy benefit services has now mostly concluded, and it was our strongest ever. Through our other pharmacy care and specialty drug businesses, given our current positions, we see significant opportunity to more fully serve patients' pharmacy needs in their communities and drive better adherence and clinical outcomes. At OptumInsight, revenues of $10 billion grew 11%, and the revenue backlog was up 14% to $19.3 billion. OptumInsight, perhaps more than any of our other businesses, has a dual role. It has both unmatched capabilities to help distinguish our other businesses and serves as a profitable, growing, externally-facing business on its own. I'd like to spend a few extra minutes this morning on how we view OptumInsight and why we're encouraged by its potential. I'll start with the foundations. First, deep data and advanced analytics are at the core, supporting modern technologies and platforms to make the health system more interoperable, transparent, and efficient. Second, research, consulting, and large-scale managed services enabled by data analytics and digital and operational innovations make the consumer experience simpler, smarter, and more compassionate. And third, clinical expertise combined with rich data and analytics drive measurably better patient care and outcomes, reduces friction while lowering the total cost of care. We're connecting the health system to deliver better outcomes, lower costs, and an improved experience for patients and their clinicians. This includes developing the connective infrastructure that integrates clinical systems, revenue management platforms, and administrative claims transactions to enable critical bidirectional data exchange. Our solutions are harmonizing and organizing billions of transactions while applying considerable intelligence through our advanced technologies, clinical ontologies, and data analytics capabilities. We want to ensure critical decision support information gets to the right people at the right time, with rigorous protocols to protect patient privacy, all while offering full transparency of health system performance on both quality and cost. Our Optum 360 business helps health systems and hospitals improve revenue performance and patient experience. We deploy natural language processing for computer-assisted coding and documentation. and provide data interchange and information exchange solutions, as well as patient access services. Optum 360 now manages about $70 billion in annual billings for unaffiliated customers. More than 5 billion pages of clinical documents are processed annually by our natural language processing engines. These are used in a variety of other applications, and customer bases to help inform clinical actions and create administrative efficiencies from the more than 80% of the clinical record that is essentially free text, such as physician notes and discharge summaries. Payment integrity is among OptumInsight's strongest growing businesses. We provide compliance and cost containment solutions both prior to and following the payment of a claim. We offer a comprehensive portfolio of services for data mining and predictive modeling to help over 250 national, state, and local health plans and others ensure appropriate payments for services, saving billions annually. Within the OptumInsight technology businesses, we apply advanced analytics and deep learning models to healthcare data covering nearly 240 million people to help optimize clinical outcomes and reduce the cost of care. Key offerings include population health, risk analytics, and technology support. And our research and consulting businesses provide thought leadership and expertise that reaches more than 200,000 leaders across the sector. Importantly, this business keeps us at the forefront of how health systems and providers are thinking about and approaching the future. and drives deeper, more integrated customer relationships across the broader Optum businesses. As we turn into the new decade, we stand at a potentially transformative moment where the application of leading 21st century technologies and machine-powered analytical protocols will open up for the first time the opportunity to create ever more precise predictions of individual and system health status and risk. This will accelerate a much more focused set of interventions to improve outcomes. I've no doubt this will be an increasingly critical element of our opt-in-wide goal of improving clinical outcomes, quality, and affordability. Now, I'll turn the call over to Dirk McMahon, UnitedHealthcare's Chief Executive Officer.