UnitedHealthcare is off to "an excellent start" in Medicare Advantage for 2021, UnitedHealth Group CEO David Wichmann told investors Wednesday.
On the company's fourth-quarter earnings call, Wichmann said that the insurer expects to add 900,000 new members to its Medicare plans, including individual, group and dual special needs coverage.
Wichmann said that UnitedHealthcare has added 3.5 million more Medicare Advantage members over the past five years.
"2021 will be one of our strongest years of growth," Wichmann said.
The MA market is hot and growing across the board, with insurers investing heavily in continuing to expand membership. Enrollment in the program has doubled over the past decade, according to data from the Kaiser Family Foundation, with 39% of beneficiaries enrolled in an MA plan for 2020.
As baby boomers age into the program and the Medicare population continues to grow, that number is also expected to grow in tandem.
Wichmann said that UHC has also invested heavily in offering more options for its members, such as home health and concierge care, to better meet them where they are.
"We’ve also been enhancing our offerings to better meet expectations about how people want to live their lives," he said.
UnitedHealth Group reported $2.2 billion in profit for the fourth quarter of 2020, bringing its full-year earnings to $15.4 billion.
The quarterly profit figure surpassed Wall Street's expectations.
While profits for the quarter were down compared to the fourth quarter of 2019, during which the insurer brought in $3.5 billion, overall profits for 2020 were up. UnitedHealth earned $13.8 billion in profit in 2019. Insurers largely predicted a decline in profits for the fourth quarter as COVID-19 costs increased and care utilization stabilized.
The healthcare giant also reported $65.5 billion in revenue for the quarter and $257.1 billion for the year. Quarterly revenue also beat analyst predictions.
In 2019, UnitedHealth reported $60.9 billion in fourth-quarter revenue and $242.2 billion in revenue for the full year.
“I couldn’t be prouder of the more than 325,000 women and men of this enterprise for their role in advancing a higher-performing health system during these times of unprecedented challenges,” said Wichmann in a statement. “We are grateful for the human spirit and resolve of our people, including our 125,000 clinicians who, with other frontline health care workers, demonstrated extraordinary collaboration, compassion and innovation.”
In its release, UnitedHealth said the quarter was once again led by its Optum unit, which has been a significant source of growth over the past year.
Optum, which includes UnitedHealth's pharmacy benefit manager, its provider services and a data analytics arm, brought in $136.3 billion in revenue for the year, compared to $113 billion in 2019.
OptumHealth, for instance, served 98 million patients by the end of 2020, compared to 96 million the year prior, with revenue per patient served up 29% year over year. OptumInsight's revenue backlog also grew by nearly $1 billion to reach $20.2 billion, UnitedHealth said.
UnitedHealth sees a number of areas for continued growth at Optum going into 2021, including continued expansion of value-based care, further growth of ambulatory services and multidose packaging at OptumRx.
Full-year revenue at UnitedHealthcare reached $200.9 billion, up from $193.8 billion in 2019. One area of significant growth was Medicare Advantage and Medicaid, with UnitedHealthcare seeing 8% higher revenue and an additional 1.2 million people signing up for coverage.
UnitedHealthcare expects continued growth in its government plans for 2021 and is expecting to add about 1.5 million members in total across all of its plans this year.
UnitedHealth Group also reiterated its 2021 guidance, which was initially released at its investor day in early December. It expects to bring in $227 billion in revenue for the year and projects earnings per share of about $16.75.