UnitedHealth Group Inc. has reported first-quarter net income of $6.29 billion, compared with a $1.41 billion loss in the same period a year earlier. The company cited increased utilization in its Medicare Advantage segment and changes in member profiles as key pressures on performance.
Chief executive officer Andrew Witty said the quarter developed in “seemingly disparate ways”, with growth across business lines and expanded services offset by challenges that he described as “unusual and unacceptable”.
Utilization trends in Medicare Advantage exceeded expectations, Witty said. The company had anticipated that care activity in 2025 would align with 2024 levels, but early indicators suggest that activity increased at roughly twice the projected rate. Physician and outpatient services accounted for much of the increase, while commercial and Medicaid segments remained closer to forecasts.
Witty also noted that changes in the composition of Optum Health’s Medicaid membership affected revenue. Some new members had previously been covered under plans that exited their markets, leading to lower engagement and reimbursement levels. He said the company believes these figures may not accurately reflect members’ actual health status.
“Additionally, many of the current and new complex patients we serve are more affected by the CMS (Centers for Medicare & Medicaid Services) risk model changes that we are in the process of implementing,” Witty said.
In response, UnitedHealth is expanding outreach efforts to high-risk patients, including through clinical and value-based care programs, as well as engaging members in home and post-discharge settings. The company is also reviewing and updating health assessments for new members.
Despite these challenges, UnitedHealth reported higher net income in recent quarters. It ended 2024 with net income of $5.54 billion, compared with $5.46 billion the previous year.
First-quarter total revenue reached $109.58 billion, up from $99.8 billion a year earlier. Chief financial officer John Rex said revenue growth was supported by strong member retention and expansion, along with a 14% increase in OptumRx revenue, which totaled $35 billion for the quarter.
While revenue grew, Rex said the company’s full-year outlook remains cautious due to ongoing pressures from care utilization and member composition. The medical care ratio rose to 84.8 in the first quarter, up from 84.3 a year earlier. The company expects the full-year ratio to reach 87.5.
In December 2024, UnitedHealth Group was affected by the death of Brian Thompson, then-CEO of UnitedHealthcare. Luigi Mangione, 26, was arrested and later indicted on federal charges related to the incident, including murder, stalking, and firearms violations. He also faces charges in New York and Pennsylvania. Federal prosecutors have indicated that the case may be pursued as a capital offense.
Officials said Mangione had been following Thompson for weeks prior to the incident. His online activity, including commentary referencing the "Unabomber Manifesto," has received scrutiny, though a motive has not been publicly confirmed. A federal court hearing in the case is scheduled in Manhattan.
