UnitedHealth Group Incorporated

Good morning and welcome to the United Health Group second quarter 2023 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 risk 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 call will also reference non-GAAP amounts. A reconciliation of the non-GAAP to GAAP amounts is available on the Financial and Earnings Reports section of the company's investor relations 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 July 14, 2023, which may be accessed from the investor relations page of the company's website. I will now turn the conference over to the Chief Executive Officer of UnitedHealth Group, Andrew Witte.

Thank you and good morning, and thank you all for joining us. As we discussed a number of weeks ago, during the quarter we saw a somewhat higher than usual range of movement in certain areas of care activity. As you'd expect, this inevitably impacted some elements of our business, but we overcame these dynamics with strength in other areas. Our second quarter performance reflects the capabilities, agility, and dedication of our people as they responded to the changes. As a team, we're confident in our ability to robustly grow in this fluid healthcare environment. Indeed, as I hope you saw in our release today, revenue growth in the quarter was strong and well-balanced across our enterprise, increasing by more than $12 billion to nearly $93 billion. Let me provide a few highlights of our growth. The number of patients served by OptumHealth under fully accountable value-based care arrangements grew by more than 900,000 over this time last year. Among the new patients we welcomed, a significant number have complex needs. These people have serious health challenges, limited economic resources, and often live in communities where it can be difficult to access high-quality care. Our ability to support their needs is distinctive, and a direct result of the investments we have made to provide coordinated and comprehensive medical, pharmacy, and behavioral care. Foundational capabilities that will help the patients we serve live healthier lives and drive growth far into the future. OptumRx and OptumInsight revenue grew double digits on expanded capabilities and products that are generating new sales and opportunities. UnitedHealthcare's growth was strong and diversified as well. Today, we're serving nearly 1.6 million more people in our commercial and public sector program offerings than we did last year. This durable growth, driven by our colleagues' relentless focus on quality and execution, enabled us to achieve second-quarter adjusted earnings per share of $6.14, which and to strengthen our full-year outlook to between $24.70 to $25 per share. We know there is great interest in understanding the recent care activity I just mentioned, but I'll give you an overview of how we're seeing care patterns progress and how we're responding. I do want to underscore the most critical point first. Making high-quality care more affordable and accessible is at the core of our mission. Having more people obtaining the care they need is a positive trend for individuals and our health system and society. As we discussed several weeks ago, during the second quarter, we observed increased care patterns, notably in outpatient surgeries for seniors, and especially with certain orthopedic procedures which may have been postponed. John will provide some additional detail on this later. As we look to 2024, we have developed compelling Medicare Advantage offerings. Our teams were, of course, thoughtful, both in our response to the CMS rate notice and in incorporating these care activity trends into our June benefit filings. Even in this challenging funding environment, we continue to prioritize the stability and affordability our members have come to rely on from UnitedHealthcare. We're confident that next year we will once again grow at a pace exceeding that of the broader market. While of a much lesser impact than senior outpatient care, we also are seeing increased care activity in behavioral. Over the past few years, behavioral care patterns have been accelerating as people increasingly feel comfortable seeking services. Just since last year, the percentage of people who are accessing behavioral care has increased by double digits. From our perspective, it's an encouraging sign that more people are seeking help. Yet, the ongoing shortage of qualified care providers has caused significant access challenges. To address the issue, Optum Health has expanded its network by tens of thousands of care professionals this year. and we are developing our benefit offerings, assuming demand for behavioral care services will continue to rise. OptumHealth's value-based care models are continuing to deliver especially strong and measurable results for people, today serving more than 4 million patients and dozens of payers. OptumHealth and the patients and payers it serves share a common desire to seek improved health outcomes and experiences. while ultimately lowering the cost of care. We're pleased to see more evidence supporting the efficacy of value-based care. Last month, researchers at Yale Medicine, working in collaboration with Optum, published a peer-reviewed study about in-home visits, an important element in our value-based care approach. The study found patients who received our in-home preventative wellness assessments compared with those who hadn't made fewer emergency department visits, and spent fewer nights in hospitals across four common conditions, depression, hypertension, coronary artery disease, and type 2 diabetes. They also experienced reduced wait times for follow-up primary care. Yale Medicine's research follows another peer-reviewed study published in JAMA in December, which found Medicare Advantage patients in Optum's fully accountable care model showed significantly better health outcomes compared to people in Medicare fee-for-service. OptumHealth patients fared better on each of eight key metrics, including hospital readmissions and emergency department visits. We see these results as compelling validation of the value-based care approach and signal more strongly its promise and potential as we expand these care models to many millions more patients in the years ahead. I'll now turn it over to UnitedHealth Group President and Chief Operating Officer, Dirk McMahon, to elaborate on how we're focusing on affordability, transparency, and simplicity for the people we serve. Dirk?

Thanks, Andrew. Making high-quality care more affordable and more accessible is what we do. So it is really great to see people getting the care they need especially as our teams are working to build more capacity and our benefit networks and care delivery resources to accommodate consumers' evolving needs. Affordability is vital. For far too many people, cost remains the most significant barrier to high-quality care. We are leaning in hard on behalf of consumers, employers, and health plans to lower out-of-pocket costs and drive greater affordability throughout the system. As you heard from Andrew, Recently, we've seen an uptick in outpatient surgeries. Finding the most appropriate site of service is crucial because the cost of those procedures can differ dramatically depending upon where they are performed. Overall, evidence shows that comparable procedures performed in ambulatory surgery centers cost about half as much as traditional settings with comparable outcomes. For consumers, that translates into many hundreds of dollars in out-of-pocket cost savings for just a single procedure. And the patient satisfaction levels at our centers are among the highest in healthcare, with NPS approaching 90. Also high on our affordability agenda is continuing to lower the cost of prescription drugs. Our customers, including employers, unions, health plans, and governments, count on us to help them access the most effective medicines at the lowest possible cost. In fact, Pharmacy benefit managers like ours are the only link in the drug supply chain whose main purpose is to improve affordability for everyone. We go further by recommending benefit designs and providing tools to help consumers navigate their options and find the best value for their prescriptions. A recently launched feature called Price Edge, which provides the lowest cost option for a patient's medication, already has delivered millions of dollars in consumer out-of-pocket savings. Specialty drug costs continue to be a focus of every customer Optima RX works with. Our differentiated approach to specialty is designed to serve the unique needs of patients, payers, providers, and pharma partners, and has allowed us to greatly expand our access to limited distribution drugs. We work to tailor our programs with individualized single point of contact care for rare disease and clinical excellence programs for conditions such as MS, autoimmune diseases, and cancer. Clients working with OptumRx who implement all our specialty medication management programs can save up to 20% on their specialty drug costs. Mostly related to specialty, Biosimilars are another area where we are helping drive affordability and consumer choice. Earlier this year, we began offering Amgevita, a biosimilar to Humira, at parity, ensuring patients and their doctors have more options to choose from when deciding on a course of care. Recently, OptumRx and UnitedHealthcare announced the addition of two new Humira biosimilars, Siltizo and Humira. Hyrumos to our standard prescription drug list also at Parry. This increased competition for the innovator drug will result in double-digit savings for our customers. You might also recall that a year ago we announced our initiative to offer life-saving drugs at no cost to our customers. This benefit is available to everyone in UnitedHealthcare's group fully insured commercial plans. and has been adopted by more than 500 of our self-funded customers, increasing adherence and saving people millions of dollars. Finally, another important customer innovation that is making the health system simpler is Optum Financial's integrated card, which enables seamless access to benefits, programs, and rewards for more than 13 million consumers who have issued the card since we broadly rolled it out at the start of the year. Adoption and satisfaction levels have been very strong, making it much simpler for seniors to navigate the system and understand their benefits, and creating a more satisfying consumer experience. These and many other results are validating our strategic approach to healthcare. I know from my many meetings with customers that these affordability, transparency, and simplicity initiatives are resonating. They are a key reason for our continued growth in a highly competitive environment, and for our confidence in maintaining our momentum as we look ahead. With that, let me hand it over to Chief Financial Officer John Rex.