Good morning, everybody, and welcome to New York, and welcome to our investor conference for 2023. Sorry, we're starting just a couple of minutes late, but it turns out one or two folks went to the Sheraton by mistake. So, we've now got everybody here, and welcome. Thank you, most importantly, for giving us your time today, and for those who are watching online, thank you also for sparing some time today to listen to our updates for you. It's gonna be a busy morning, and I'm looking forward to introducing to you, during the next 90 minutes, couple of hours, many of our executives from across our organization. Over the last year, about 3.9 million people have applied to work for UnitedHealth Group, and so far this year, our voluntary attrition has dropped by about a third.
So people want to stay longer, and more and more people want to come and join this company, and the reason for that, I think, is because they're inspired by the mission of the organization. It's a mission which strives to work every single day, 24/7, to improve the health system that we're all a part of, and that one day we all end up relying on. That mission of improvement is focused on helping one individual, one patient at a time, and it's a mission which faces into a daunting system, $5 trillion system, almost 1/5 of the entire GDP of the country, bigger than the entire economy of Japan, a complex system that's grown over many decades. It's grown interwoven, it's grown in fragments, it's grown locally, and it's grown in a way which has not been planned in any particular form.
It's done its best to keep up with innovation. It's done its best to keep up with new ideas and technology, but ultimately, it is complex. It is difficult to navigate. It is difficult to deliver great value for money and great quality outcomes, and our mission is to try and improve all of those things, and that's why so many people want to be here. They want to join the 450,000 or so people already in UnitedHealth Group, who work every day in the benefits businesses or the care delivery businesses to try and advance the objective of making the health system work better for everybody. As we think about how to work to streamline that great system, how to improve that great system, it's inescapable that you need to have scaled capabilities to tackle that job.
The idea that we can make real progress in a kind of mom-and-pop approach, doing things at micro levels and just hoping that naturally it all solves some great problem, I think is unrealistic and non-achievable. What we bring at United is an idea, an idea of bringing together many different capabilities, capabilities that we work hard to understand how we can align incentives so that system parts start to gear together, not against each other. They align instead of conflict. We start to populate within those business models, those incentive frameworks, parts of the organization which deliver care, parts of the organization which help to inform users of care. All of that said, is bringing together a set of scale capabilities which allow us to make bigger impacts across large parts of the system.
We spend our capital relentlessly looking for new ways in which we can supplement and augment those capabilities, but we firmly believe that scale is an important element of this change. But of course, nobody can do all of this on their own. You have to do it in coalition, which is why we're so committed, and we're so proud of the deep relationships we have with so many participants in the U.S. healthcare system, whether that be federal government, whether that be state, whether that be other payers, whether that be employers, unions, and of course, individuals and their families.
We see that as a grand coalition, a coalition that we want to try and continue to stimulate, to work with us, to think about how we can take good ideas and spread them across the country, how we can truly lift the right piece of innovation, integrate it into a broader value stream, and allow it to have the impact it really deserves. Last year, I talked a little bit about this paradox of nowhere in healthcare in the world is there more innovation than in America, and yet, somehow it hasn't led us to a simpler, more efficient system, and the reason for that is because we haven't been able to properly integrate those points of innovation into the value streams which allow impact to be delivered for many.
That coalition across government, across state, employers, unions, individuals, their families, and United, is a coalition that we are deeply invested in continuing to prove can work. We want to make sure people understand the value we can bring, and in many times, how we can be the catalyst to help other parts of the system work better. You'll see many examples of that this morning. In addition to dealing with the challenge of how can we improve the system, how can we start to think through in, incentive models and the like, we also, like all companies, have to be agile and adaptable. Those are not always terms that are associated with companies the size of this one, but it is a characteristic of UnitedHealth Group. We are agile, we are adaptable, and we strive to be nimble.
We work hard to make sure that where we start new ideas, we complete them, but if they don't work, we shut them down, we course-correct, we move on.... Where we're in environments where things suddenly change, we are focused on not simply wringing our hands, but dealing with it. A good example this year, the rate notice on Medicare Advantage earlier this year. Significant change in the funding outlook for the future from Medicare Advantage. That rate notice has a material impact in terms of revenues associated with our Medicare Advantage portfolio, and as you can see, that ripples through the metrics of the organization. As revenues, essentially a price cut for Medicare Advantage occurs, you see that pattern flow through the business.
Yet here we are today, standing up and saying, despite that change, despite that impact, we are committed to the kind of earnings growth rate over the next 12 months that you would expect from us, even if there hadn't been a rate notice cut. The reason for that is we spent the last 6 months reconfiguring our plans for the next year and 2 and 3 and 5 years in response to the change in circumstance. We focused on how we can protect members and their benefits. We focused on how we can take more cost and efficiency into our organization, and we focused on how we can double down on eliminating waste and unnecessary care in the health system more generally.
We've used that adverse event in terms of the rate notice change as a stimulus, as a catalyst, as a way to make us rethink and redouble our energies around the things we've always believed: that we'll put our members first, that we will strive to be the most efficient healthcare delivery organization in the country, and that we will focus on delivering true value-based care, meaning that the care you need is great, but you don't get care you don't need. Meaning that if you do a great job delivering care, we will pay what you deserve, but we will not pay where the work that's delivered is not necessary or is not high quality.
Those are the characteristics which have led us to be able to say, "Okay, revenues change, various parts of our metrics change, we respond in other ways." We've also taken the opportunity to respond not just for 2024. The rate notice effect is a 3-year effect. Anybody who responds for 1 year against a 3-year effect is gonna be in trouble. We have taken a very clear and sober view about how we do everything I've just described, not just for 12 months, but for 36 and for multiple years afterwards. The stimulus of that rate notice has been an incredibly positive and healthy event for UnitedHealth Group. Not because it gave us more money, it didn't, but because it gave us the stimulus to re-challenge ourselves on how we do things even better, even more effectively going forward.
Our confidence in our ability to deliver that growth that we've committed to you this morning is built on the five growth pillars that we've been talking to you about over the last several years. You're gonna hear a lot about those growth pillars and the progress we've made over the last two or three years against all of them. How we've taken the elements of those pillars and increasingly woven them together, how we've taken ideas that have worked in one state and replicated across the country, how we've taken ways in which we might perform in, for example, the pharmacy platform, and figured out ways to leverage it alongside our health platform. Those are all examples of the progress you're gonna hear in the rest of the morning.
But you're gonna hear those five growth pillars really brought together through two absolutely driving outputs of the organization: value-based care and empowering the healthcare consumer. Those will be the lenses through which you'll see all of the activity of the five growth pillars of the company.
Put another way, the core objective of UnitedHealth Group over the next several years is to continue to drive the implementation of value-based care at speed, to continue to extend its quality, continue to extend its worth far beyond the initial senior marketplaces, and at the same time, to fundamentally transform the way consumers and families think about healthcare from being something which is so complicated, I don't want to talk about it, to something where I feel like, "Yeah, I can just look at my phone and get what I need." Those two lenses, value-based care, empowering the U.S. healthcare consumer, are the key ways in which we are driving and aligning all of the outputs of our growth pillars. Think about those pillars as being core organizing engines of the company.
They drive their own agendas, but they look for ways in which they can support the value-based care and the consumerization agenda of the company. That's where everything starts to come together. We believe over the next decade, the next 2 decades, to aspire to what we aspire to be, we need to demonstrate those two things. That we have indeed figured out a way in which we can pull together the various elements of the system into a new way of care delivery, value-based care, which works. Better care outcomes, better experience, higher quality, better cost. We can wrap around that an engagement model, a way of connecting to real people that they really get.... That's what we are aiming to build over the next 10 or 20 years, and we believe that's gonna be very differentiating. It's not unique.
Not every piece of that story is full of new ideas. In fact, you'll look at things today and say, "Isn't that like an old idea?" The difference is that we're figuring out ways to take ideas people have talked about for many years and actually bring them to life, and actually bring them to a scale which makes an impact on people. Crucially, we're trying to do that regardless of what your zip code is or what your income level is. We're trying to drive forward a way of improvement which is truly available to all who need it. That's what we're striving to do. What makes me incredibly confident about our ability to do all of this is the culture of this organization.
Those 3.9 million applicants want to come to this place, and when some of them get the chance to come to this place, they'll find an organization which has a culture which I would characterize as being restless, compassionate, and accountable. It's a culture where every day, and you're gonna meet and see many of these people, every day, people wake up despite our size and say, "How do we do this better?" Restless. How do we do better? Why didn't we get that right? Every day they wake up and try and figure out a way to look after somebody better. Compassionate. How do we do a better job of making that member or that patient have a better experience? How do we satisfy more? How do we delight more?
Every day they wake up feeling the drive and the need to honor the commitment that they made. Whether that commitment was made to a patient or a consumer or a fellow employee, or to one of the 100 payers who rely on Optum, who are not UnitedHealthcare, or whether it's one of the four in five hospitals across America who rely on Optum, all of those people every day wake up and think about how we deliver on our promise. The accountability running through this organization is second to none.
The combination of restlessness, compassion, accountability, drives a culture in this organization which gives me, gives our leadership team, real confidence that whatever is thrown at us in terms of change of assumption, we can deal with, and more importantly, we can deal with and not be disturbed from the direction of travel that I've laid out this morning. That vision of really starting to improve the healthcare experience for many through real clarity of where we're focused on investing in our growth engines, and through real understanding that to achieve that improvement requires a different way of organizing care, value-based care, and a way of bringing to life engagement for everybody across the country through a much more empowered consumer relationship. We're looking forward to giving you more detail on all of this, this morning.
We're also looking forward to having the chance to talk to you individually in many different formats during the day. I hope you will take the opportunity to ask any question you have, and please feel free to chat to any one of the 60 or so leaders of UnitedHealth Group who are here this morning in New York. Thank you for joining us, and with that, I'm gonna invite our President and Chief Operating Officer, Dirk McMahon, to open the day. Thank you.
So, 20 years ago, I got my start at this company running a UHC team supporting small business. These were businesses born around the kitchen table, people with tireless work ethics, taking chances on good ideas in untapped markets, a perfect place to learn. I saw firsthand how health benefits could punch above its weight when it comes to employee retention, productivity, progress. Companies making tough choices every day on service, on quality, on economics, convenience, and their healthcare was no exception. Those early days proved to me I was in the right place. It showed me that UnitedHealth Group was a business built for people, for both small town stores and for the global employer.
A company focused on execution, a creative and growing set of distinct capabilities, and with the right team of our own, we were able to help people, the chef, the daycare provider, the florist, and the partner they can count on. So every year, we offer you an update on our own kitchen table story, the decisions we made along the way that have shaped our character and evolved our role in the entire system. From the days as a health plan focused on commercial insurance to the nationwide care delivery organization we are today, and how the decisions of the past provide insights into where we go next.
We bring on stage today a talented team of frontline leaders, innovators from global IT, banking, consumer brands, those who got their start as clinicians, public health educators, and United States service members, each one with their own imagination for what healthcare can be for people... bringing to life their own good ideas and going after new markets every day. That restlessness of our people is what others count on, delivering high-quality care on behalf of everyone in the system through a durable model built to last and always improving over time, with innovation as a fundamental quality that pushes us to unlock better experiences, more value, and improve connectivity for the system, all done with the consumer at the very heart of every product roadmap.
In each of the last two years, that story has been told by stepping through five strategic areas that are driving long-term sustainable growth for UnitedHealth Group. Working to expand the number of people benefiting from value-based care, the many ways we're reimagining health benefits in markets of every shape and size, how we're pushing the boundaries of health technology, facilitating transactions and the flow of information between health plans, providers, and consumers, how financial services network is innovating payments and improving the connectivity and exchange of capital in the marketplace, and finally, how we're helping people manage everything from complex specialty medications to getting the right medicine on time for the lowest price. In the years since, we've nearly doubled the number of people we care for in fully accountable arrangements to more than four million.
We've grown the number of people in our MA plans by more than 25% to 9.3 million. We'll have processed nearly 3 billion adjusted scripts and over $1 trillion in health payments. Together, these strategies have helped us grow the number of people we serve to more than 152 million across Optum UnitedHealthcare. Now, I like to say you're only as good as your last at-bat, so today we're gonna give you a deeper look at how all this works and what comes next. We'll spend our time this morning talking through two key stories. First, we'll show you how our approach to value-based care is resonating with patients, clinicians, health system leaders.
From the Hudson Valley, where I grew up and where our Optum practices are taking care of my mom, to Southern California, the birthplace of our pharmacy benefit management capability, the first company that I ran at Optum, to the Nevada desert, where Brian Thompson and I were part of a team that brought some of our first care delivery capabilities to the company, foundational building blocks that would become the earliest pieces of our value-based care strategy. Then we'll show you how we're orienting our businesses and designing our new products to hold up against the ever-evolving preferences of the American consumer, whose voice will get only louder, demanding more value for their dollar, more transparency, and improved quality at every turn. Okay, with that, BT, I'll let you take it from here. Value-based care: where are we going and how are we getting there?
Thanks, Dirk. In the simplest sense, we're helping to accelerate the transition from volume to value, moving beyond a transaction-based health system where physicians are incented only to engage people in a single episode of care, to a model designed to be proactive and to help keep people healthy over the course of a lifetime, one that rewards high-quality care, delivers better outcomes, and drives lower costs. In a value-based system, physicians are supported by a care team. They have more time to get to know their patients, develop personalized care plans, and they use real-time data and evidence-based clinical insights to anticipate what their patients might need. Today, value-based care is the centerpiece of our growth strategy, and from my vantage point, leading UnitedHealthcare, it is by far the greatest opportunity we have to deliver superior outcomes and lower costs.
With primary care as a foundation, we've brought on additional capabilities over time, specialty care, outpatient surgical centers, post-acute support, behavioral health, and pharmacy services. We've created the capacity to move beyond the walls of a traditional clinic to care for people virtually, and now, more than ever, in the comfort of their own homes. At UnitedHealth Group, our deepest and most impactful relationships are with the more than 4 million people we serve in fully accountable arrangements, and as Dirk said, that number has nearly doubled since 2021. You should expect us to continue to grow this number substantially each year, as our long-term ambition is to transition as many people as possible into value-based care. You know, we pioneered senior-focused value-based care with Optum more than a decade ago, driving a real focus on quality outcomes.
At that time, the percentage of our seniors in four-star plans was only in the high single digits. Today, 9 out of every 10 people we serve are participating in a Star plan of 4 or more. That's a tenfold increase. Clinically, we see many other benefits. When you compare it to fee-for-service, people in our fully accountable MA arrangements with Optum experience better complex care management. Their Medicare Advantage patients were 44% less likely to be admitted into a hospital for COPD or asthma and had a 10% lower rate of admission for stroke or heart attack. They also had 14% fewer avoidable emergency department visits. They also had lower admissions. Their patients were 18% less likely to have an inpatient admission, and 9% fewer readmissions to the hospital within 30 days.
They had better engagement with their health, over 31% higher rates of annual wellness visits. Now, beyond clinical quality improvements, our value-based care arrangements with Optum are driving important innovation in health, like better products that provide increasing benefit engagement, such as our integrated benefits card and our improved transportation model, both of which you'll hear more about today. Finally, we continue to invest deeply in our benefits across our value-based care arrangements with Optum, increasing their value by more than 40% over the last 5 years. Yet, as far as we've come, the percent of dollars in the United States that flow through fully accountable payment models is still in the single digits. We are in the early stages, and there is a lot of opportunity ahead. Healthcare should be easier for people.
We are cognizant of the challenges, but navigating a future through value-based care unlocks a situation where the family doesn't have to make the decisions on their own. It doesn't fully rest in their hands, and they can be supported by value-based care. Now, Dr. Amar Desai will describe how the Optum Health team is continuing to build the capacity and scale to bring value-based care to millions more people served by UnitedHealthcare and many millions of others throughout the health system. Amar?
Thanks, BT. Today, Optum Health's nearly 90,000 physicians and 40,000 advanced practice clinicians serve tens of millions of people throughout the United States. Some of our patients are Brian's customers, but many more are not, as we work with more than 100 health plan partners. Our value-based care journey has been one marked by expansion in the assembling and integration of capabilities and in our reach and impact in different regions of the country. As you heard from Brian, we serve more than 4 million people in fully accountable arrangements today. By this time next year, we expect to grow to nearly 5 million.
We'll do this by deepening our capabilities and in communities and presence where we already have Optum capabilities, while continuing to expand in new geographies, and further integrating care for patients along every step of their journey, ensuring patients can receive care where and when they prefer. Let me give you two examples: pharmacy care and behavioral health. In pharmacy care, we can seamlessly connect our patients to services through Optum Rx, unlocking access to reliable home delivery, specialty pharmacy, and home-based infusion therapies. Great pharmacy care leads to better adherence to medications and higher quality outcomes. Our home delivery patients achieve adherence rates above 90%. That's compared to 70%-80% for patients who are on 30-day scripts at retail pharmacies. We operate nearly 700 community-based pharmacies and infusion sites. Some of them are located within our clinics.
These pharmacies are serving some of the most vulnerable individuals, including people who are on Medicaid. In behavioral health, we added 45,000 therapists, psychiatrists, and behavioral health professionals to our national provider network. We have integrated home care delivery with our behavioral health benefits business to improve timely access to behavioral care for our patients through our home care program. As a physician, I'm particularly excited that we are becoming the practice and partner of choice in the marketplace. That is because we are driving quality, standardizing technology and clinical systems, and most importantly, strengthening our relationships with patients and our providers. Journey, it really is the right word to describe where we've been and where we're headed. In some areas of the country, we're quite far along, and in other areas, we're just taking off, and we've gained a lot of hard-won experience along the way.
For six years, I led several markets and care delivery organizations that are now part of Optum West. There, we created a unified experience for patients and care teams. We integrated support functions and technology, and we empowered local physicians with best practices and the tools they needed to best serve in value-based arrangements. For example, within the West, California represents one of our larger, fully accountable, value-based patient populations, where we serve Medicare, Medicaid, and commercial health plans, delivering a connected and coordinated care. Taking what we've learned in California, as well as in other advanced value-based regions like Texas and Nevada, we'll establish and grow value-based care delivery in more regions across the country. Caitlin Zulla is here to share one example.
Over the past few years, Optum's presence has been growing in the Northeast. We now serve more than 5.5 million Medicare, commercial, and Medicaid patients across Massachusetts, Connecticut, New York, and New Jersey. Before leading the Optum Health East region, I led Optum's national ambulatory surgery care business. While we were national, our strategy was local and regional. No care system looked the same, and we adapted to local needs. It's the same approach we're taking in the East, but on a much larger, more comprehensive scale. We are rapidly maturing our multi-specialty, fully accountable care business which represents 8% of our Northeast patients today.
Whether it is our relentless focus on quality in Massachusetts where Optum practices are consistently ranked in the 90th percentile in HEDIS quality measures to partnering with health systems in Connecticut and growing fully accountable lives in New York and New Jersey through comprehensive connected capabilities like behavioral health, complex kidney care management, in-home, and post-acute navigation. This is all assisted by integrating Optum's care and administrative platforms that drive both operational and clinical excellence, and by leveraging the strengths of our other businesses in Optum Health, like our ambulatory surgery care expertise, to create new opportunities to reduce total cost of care. To help bring just one part of our story to life in the Northeast, I am pleased to welcome Dr. Caroline DeFilippo from Mount Kisco, New York. Welcome, Dr. DeFilippo. It's so great to see you again. Tell us a little bit about yourself and your patients.
Thanks, Caitlin. It's great to see you as well, and I'm excited to be here. I'm the chair of Primary Care and Population Health for Optum's Hudson Valley area practices. We serve patients across Medicare, Medicaid, commercial, and special needs plans. More importantly, I'm also a primary care physician. Half the week, I have a full panel of patients in both fee-for-service and accountable care models. The other half of the week, I'm helping drive our transition to a more sustainable model of primary care. We're doing that through integrated care coordination technology and wraparound services like full population health management. In other words, giving primary care providers the ability to quarterback all the plays and coordinate true value-based care.
That support for PCPs is so critical. Can you tell us more about your progress in moving toward accountable care?
Absolutely. We've made a lot of progress in a short period of time. In the past, we've operated a few Medicare ACOs, which introduced some elements of value and risk, but opportunities around fully accountable care weren't possible before Optum. To succeed, you really need a local and regional approach that aligns primary and specialty care with technology and care services. Being part of Optum gave us the confidence and the ability to move into fully accountable care. The model we built from the ground up here in the Hudson Valley is now serving about 70,000 patients, and in the broader New York and New Jersey area, our fully accountable patient population has grown by more than 60%.
Can you offer a specific example of where you've seen success in bringing these Optum capabilities to bear in your practice?
Sure. I'd call out post-acute care navigation. I regularly see patients who have recently been discharged from the hospital, and too often, I have to play detective. Why were they in the hospital? What medications are they taking? Do they have home care in place? What's really going on here? With our post-acute care program, I'm now working with a proactive team, coordinating discharge, rehabilitation, and then home care. I don't have to play detective and can focus on the reason for a patient's visit. I perform my job better because care teams are tracking medications, support services, and clinical data in real time. Other capabilities Optum brings to bear are home-based and palliative care for some of our most complex patients. I can tell you that this is enhancing the physician relationship with our patients and giving us the time and space to deliver extraordinary care.
We're able to layer in the appropriate tools at the right time, which allows us to expand this model and our impact on patients.
Thank you so much, Caroline. This has been a great view into the work happening in your practice.
Thank you.
Over time, these integrated capabilities and models of care will be available in all of our markets. It's about unleashing the passion of our care providers, like Dr. DeFilippo, across the country to truly empower them to practice comprehensive and accountable care, supported by the tools that address a patient's entire needs and social determinants of health, whether in the clinic, virtually, or in the home.
UnitedHealth Group has been a leader in home-based medical care for nearly 20 years, serving people across the care continuum, from preventive to episodic, chronic, highly complex, and palliative care. While the need for home-based capabilities from consumers, health plans, and care providers has never been higher, the market remains deeply fragmented, rooted in fee-for-service models that put the burden of finding and navigating care squarely on the shoulders of the people who need help the most. To address their unique needs, we've spent the last several years building home care models unlike any other, centered around a few foundational capabilities. First, clinical visits delivered in the home and designed to identify medical care needs and help patients with other physical and social needs. Second, care transitions, where we are coordinating care for patients, their families, and care providers as members move between the home and other care settings.
Lastly, complex care, where we provide individualized support for people with the most complex needs and multiple chronic conditions, including the more than 12 million Americans who are dually eligible for both Medicare and Medicaid. These are people who often lack the economic resources and family support to help coordinate care between the home, the doctor's office, and other sites of care. Through our partnership with Optum, we have continually demonstrated the value of bringing these services into the home. This year, we will conduct more than 2.5 million in-home visits through our House Calls program, completing approximately 200,000 tests for diabetes and Hep C, which are consistently under-diagnosed conditions. Within 90 days of these visits, about 75% of seniors will receive additional primary care in a clinic setting.
Being in the home also provides the opportunity to identify unmet social determinants of health, such as healthy food and transportation. This year, we will screen nearly 3.8 million people, helping connect them to necessary resources, with over 40% of those screenings occurring during a House Calls visit. We also serve hundreds of thousands of people who are homebound through our Medicaid long-term care businesses. Our local care managers assess care needs, develop care plans, and then ensure patients get the support they need via community-based providers. And our innovative technology delivered in the home enables real-time connections with delegated providers. Now, I'll hand it over to Josh to share how we are advancing our partnership with providers around both skilled and non-skilled care.
Thanks, Bobby. Fragmentation and the opportunity to reduce it is particularly apparent for care being provided in the home. I spent 15 years helping to build LHC Group, and now I'm proud that we're part of the Optum team. In fact, one of the reasons our company was founded was to develop deeper, more personal relationships with patients and their families in the home care marketplace. Our ultimate aspiration was to move away from the Fee-for-Service model and drive better outcomes through Value-Based Care. But we knew we didn't have the capabilities to do it on our own. Now that we're part of Optum, we can. Today, we see tremendous opportunity to not only scale within Optum's value-based strategy, but also connect into the broader capabilities of Optum's comprehensive home care offerings. Anyone who has helped a loved one through a care transition knows it can be scary.
It can be a confusing experience without the right support. Yet properly coordinated, it can be game-changing. Care coordinators are active partners with patients and their families. They provide actionable information on progress and care needs while patients are in a skilled nursing facility. Our patients value these services, which is why we have more than doubled the number of people Optum's care coordinators serve since 2020. We know from experience the flexibility and convenience offered by superior home care can be transformative: fewer readmissions compared to the national average and higher consumer satisfaction. Overall, those who utilize home health services after a hospital admission have a 36% lower 90-day readmission rate than those who did not. In a recent analysis of our diabetes patients, we reduced hospitalization rates by 50%. That translates to a real difference in people's lives.
Often, we serve people that have been historically marginalized or underserved, people deemed too difficult to reach and engage, but their goals are simple. They want to walk outside, check the mail, or pick up and hold their grandchild, and that's why we are building the capacity to help more people reach and regain their independence and be where they want to be, at home. Let's take a closer look.
I drive 100 or more miles per day, and I do that 3-4 days a week. My office lets me see the world, and I get to go meet people where they're comfortable in their home. I've just always been meant to take care of people. When I first met Johnny, it was in October of 2022. The first step was I called the primary care physician, and I introduced myself, let them know I was in the community. Once I've been out to the member's home, and I've identified their needs, we all work as a team to make sure that we coordinate that care.... My dad passed away when he was 58 because he didn't know. He didn't know - we didn't know a lot of things. We didn't have those resources. We didn't have that comm`unity liaison.
We didn't have that insurance company that was willing to send nurses out to us to... We didn't have us out there, and I lost my father. I really enjoy our mission and our vision and what we stand for. Optum at Home empowers nurses like myself and other team members to go out into patients' homes and to connect them with resources, to connect them with their providers, to be that health promotion, health prevention person. The members that I take care of, not only do they have the vulnerability of living in a rural community, they are either disabled, they are elderly, or they are low income.
Tell me a little bit about what you do in the home?
So when I go into the patient's house, I look. What around me is stopping them from living their healthiest life? You can tell if a patient has several gaps in care, they haven't gotten a lot of their appointments taken care of, and they're not picking up their medication. Red flags. Something's going on, and this patient may need some extra special help. And then when I find out that they don't have a pharmacy local, or they can't get their medications filled in a timely manner due to lack of transportation, then I work with them, with our care navigator and our multidisciplinary team, to get them resources.
I am so proud of the work that you do and that we do at Optum, and the way that we are truly transforming healthcare.
You get to change people's lives, like, for the good, for the better. The little bitty things that we get to do go a long way with our patients, and there's just not a better feeling than that.
I loved the time that I got to spend with Linda. She is just one of the thousands of dedicated and compassionate Optum clinicians who support our patients in their homes every day. When I worked in the ER early in my career, I saw so many elderly patients who were in really bad shape. There were so many missed opportunities to prevent them from ending up in the ER in the first place. Home-based care gives us the ability to seize those opportunities. For example, in the program you just saw, Linda and her colleagues will help close more than 3 million gaps in care for their patients this year, addressing their medical, their behavioral, and their social needs. With this level of personalized and ongoing support, our patients are more engaged, and they're healthier.
Our patient satisfaction scores are in the 80s, and it is just one element of the comprehensive home care model I have had the privilege to help build over two decades. This year, we will complete more than 10 million home visits and deliver fully accountable care to more than 1 million dual and chronic special needs patients. That is more than twice as many as last year. You should expect strong growth in the years ahead as we continue to invest in and expand our home care capabilities to provide these critical services. And thanks to people like Linda, I have never been more excited about our ability to serve more people in more personal ways.
As my colleagues have shared, value-based care represents UnitedHealthcare's best opportunity to drive better health outcomes, better quality care, and medical cost affordability. Let me share a little bit about the Medicare Advantage program and how we are leaning deeper into senior-focused, value-based care. This fall, more than 32 million seniors, about half of all who are eligible, will choose a Medicare Advantage plan. What they are responding to is a value proposition that's hard to beat: high quality, coordinated care, and stable benefits, and for those who choose UnitedHealthcare, zero premium plans, no copay for hundreds of the most prescribed drugs, and many other features. In fact, compared with traditional fee-for-service Medicare, seniors in Medicare Advantage save 45% on out-of-pocket costs each year, which is especially important to the 52% of participants who live on an annual income of less than $25,000.
In total, these savings, when paired with those of the government, saves the health system more than 12%. Consumers in Medicare Advantage also experience better health outcomes across a broad range of measures, including more preventive care visits and fewer hospital visits. As you heard from BT, our partnership with Optum allows us to go even deeper, providing more touchpoints and more coordinated care than traditional Medicare fee-for-service. And that partnership and coordination enables us to serve 9.3 million people in Medicare Advantage plans across UnitedHealthcare. I can tell you the positive health outcomes we see across our plans are incredibly meaningful to our members and their families.
I think it's important to go a level deeper, to hear what those numbers mean from a physician's perspective and to understand the cost and health impact people incur when diabetes or hypertension goes unchecked or slips out of control. With that, I'll turn it over to my colleague, Dr. Derek Chao.
Thanks, Tim. You're right. The outcomes are demonstrably better. ... Let me share more about how we're helping achieve these improvements. In addition to leading Optum Health West, I'm also a nephrologist. I've treated many patients with diabetes throughout my career. Our care model works because it allows us to deliver evidence-based, coordinated care designed for a patient's holistic needs, everything from managing chronic disease and mental health, to reconciling medications, to coordinating with specialists to treat very complex conditions, and it all starts with preventive care. For example, Optum Health Medicare patients have higher rates of wellness visits and preventive screenings for conditions such as colorectal cancer when compared to patients in Medicare fee-for-service. Our patients in value-based arrangement also have better diabetes control than fee-for-service patients. In fact, a third of patients in our Living with Diabetes program improved their A1C by at least one percentage point.
For most adults, a normal A1C is below 5.7%. 6.5% or higher generally indicates diabetes, so that one percentage point improvement is very significant. It can mean the difference between a patient controlling their diabetes or not, which leads to a reduction in the risk for developing debilitating complications such as blindness and kidney failure. At Optum, we combine chronic condition management program and technology to identify and alert care providers to gaps in care and high-touch services for those most in need. Let me give you a couple examples. Our transitional care program helps patients navigate their hospital discharge and next care steps with the goal of preventing readmission. People who underwent the full program had a readmission reduction of 21% compared to control groups.
We also help patients form social bonds with one another, creating a sense of community among people with similar backgrounds. This not only combats loneliness and encourages people to embrace healthier living, but does it in a culturally competent way. Patients in these programs are 23% more likely to access preventive care and 15% more likely to undergo a medication review compared to control populations. These are just a few of the many ways our care teams are delivering real results for real people through value-based care.
Simply put, our ambition is to make value-based care a reality across the entire health system for all providers and available to all patients, not just the people we serve at Optum Health. Optum Insight has been working with health plans and network providers to help identify social needs and track patient encounters for more than a decade. Now we're building on this business by offering a comprehensive portfolio of provider enablement solutions to help them develop their own value-based tools. As many of you know, these transitions are not as easy as flipping a switch. It takes time and support and specific insight into their individual markets, patient makeup, and health plan relationships. We are helping them better understand their contracts and how different payment options like shared savings or capitation can increase revenue.
Our clinical support tools are helping providers prioritize patient engagement and outreach, growing their capacity to serve even more patients and spend even more time with each person. Using our capabilities, primary care physicians closed nearly 20 million care gaps, and as they deliver higher quality care, many will earn incentive payments, some for the first time. As we make our provider enablement services available to more practices, we're seeing strong results. Earlier this year, Optum Insight partnered with UnitedHealthcare to roll out a new program to help small to mid-sized independent practices who were trying to transition to value-based care but struggling to find the right support. Across the tens of thousands of patients, we helped reduce medical costs by more than 10% with this group of providers. Our strength lies in pairing technology with the latest medical expertise, patient history, and health data.
Given these outcomes, we're expanding this effort. We'll reach more than 400,000 people in commercial plans in 2024, and we expect to grow that more than 20% year-on-year. As more providers look to move into value-based arrangements, we're also creating a distinctive set of multi-payer solutions that not only deliver improved outcomes, but free clinicians from certain administrative tasks. Let's take medical necessity reviews, a vitally important but time-consuming exercise. Powered by evidence-based guidelines that help clinicians determine the appropriate course of treatment, our AI tool can streamline administrative tasks, giving time and resources back to providers. We are continually updating our standard of care guidelines with the very latest medical knowledge to augment the expertise and decision-making of care professionals as they guide their patients along the care journey.
Our goal is to deliver consistent, data-driven recommendations to raise provider performance and increase both patient and provider satisfaction, not just for Optum providers and patients, but for the whole health system.
Every patient across healthcare, it's a bold vision, and it is the right way forward. Because value-based care is just that: it's care based in value. It's the value of a worrying symptom addressed before it becomes a disease to be managed. It's the value of remaining in the comfort of one's home. It's the value of savings realized across the health system when everyone involved is incentivized around the same indisputable goal, the greatest health of the patient, the person at the center of care. A system-wide transition to value-based care represents $3 trillion in market spend. Moving away from a fee-for-service-based system, which incentivizes volume and often results in unnecessary care, to an outcomes-based system grounded in compassion and quality. And that's why we're investing today, to create the capacity and capabilities the market needs to support a change of this magnitude.
Today, we serve more than 4 million people this way. By this time next year, that number will be nearly 5 million. Yet the opportunity to expand value-based care is nearly boundless, and here's why. Medicaid, already the largest health insurance program in the nation, serving more than 91 million Americans, will continue to grow. Half of America's seniors choose Medicare Advantage today, but just half. And right now, more than 170 million people are in commercial plans, but only a fraction of healthcare payments flow through fully accountable, value-based arrangements. A decade in the future, what might these numbers be? How might we transform not only the care model for most Americans, but the very health of our population? The progress we've seen in Southern California, in Houston, in Boston, here in New York, that's just the start.
People will continue to embrace value-based care because people appreciate high-quality care that's easier to find and simpler to pay for. People value unhurried interactions with their care providers, and they feel the difference when their own healthiest life is the guiding principle for providers and health plans alike. Every patient across healthcare, with value-based care, the possibilities are legion. Now I'll invite Heather Cianfrocco up to introduce the second half of the session, taking us into the world of the consumer.
Thank you, Margaret. We've spent the first half of the morning together on the why and the how. Why value-based care is the future of healthcare, and how Optum and UnitedHealthcare are helping to lead this transformational change through comprehensive, coordinated care delivery, with realigned incentives, new tools and technology, and clinical expertise, making care more accessible and affordable for more people at every stage of life. In the second half of the morning, we'll focus on the who, the consumer, and all the opportunity we see to fundamentally change the way people engage with the health system, how they find care, pay for care, access medicine, and feel supported and empowered in every interaction. Today, consumers influence more than $2 trillion of healthcare spend every year. We spend more of our household income on healthcare than any generation before us.
We'll make more than 1 billion office visits this year, wait an average of 26 days in the waiting room, and we'll spend about twice as long of that time in the waiting room than we'll spend with a clinician, and we'll learn what it costs when the bill shows up a month or 2 later. There's no shortage of companies that are working to change these experiences for the better, but this dynamic only compounds the challenge. There's hundreds of digital properties offering alternatives for everything, from advice and benefits to treatments and virtual care. Consumers are overloaded. We're overwhelmed with options, and we're struggling with point solutions as we try to customize, compare, and choose. But for the American consumer, stakes are high. They need a team to bring it all together and help figure out what's best for, for their families....
There's no company in a better position to do just that than UnitedHealth Group. We're listening to what people want. We're not looking to simply exceed expectations for convenience but we're aspiring to be a lifetime partner in their health and their well-being, a first point of consultation for every question and their trusted source for expertise and information, all backed by the power of nearly 130,000 trusted, compassionate care professionals. This means meeting people where they are, which at times means moving healthcare from a clipboard in the clinic to an app on their phone, developing the digital-first capabilities that enable our company to deliver on these ambitions of convenience and consumer confidence.
So from innovation and health benefit design to modernized payment capabilities and simplified pharmacy interactions, we're working to change the consumer experience across every aspect of care for the people we serve, but also for millions of others in the broader marketplace. Becoming a consumer-led organization means embracing process reinvention. It means tapping into AI and other technological innovation to drive productivity and to lower our own cost structure. Now, I'm gonna turn it over to Krista Nelson, where she'll take you through the ways we're doing just that, transforming our own business from the front lines to the administrative office. Krista?
Thanks, Heather. Today, we have relationships with more than 150 million consumers across UnitedHealthcare and Optum. Three years ago, about 70% of our interactions with consumers were digital, and three years from today, we expect that to be more than 90%. We're driving this transformation across the more than 52 million people we serve at UnitedHealthcare today. And within UnitedHealth Group, we have an unparalleled opportunity to drive this change across the entire healthcare system. We are leveraging advanced technology, like AI and ML, at scale to improve the experiences for the people we serve, as well as improve our administrative cost and operating productivity. In many ways, the value of digital and advanced technology lies in applying it in a way that makes life better for consumers and providers and for our people. This is exactly where we're spending our time.
We've made tangible improvements because of this approach. In the past year, we've seen a 35% increase in digital engagement. We also have 12 times as many chats year to date with members, and more than 85% of the time, we can resolve their inquiry through chat. On top of all of this, across our digital channels, our NPS is up 65%. Not only is this good for members, but it's also good for our employees. I'm very proud of the gains that we've made in employee experience tied to the improvements we've made in technology and tools. Our approach to digital and advanced technology starts with listening to team members and consumers, and here are just three examples of how we're doing that in the moments that they need us the most. First, real-time access.
People who choose our Medicare Advantage plans can use our mobile app even before their coverage begins. For the very first time, seniors get an overview of their benefits. They can find and select providers, and they can start earning rewards immediately. This eliminates a real sense of anxiety for people and also helps us build the relationship earlier in the process, which supports retention. Second, our digital document center. This makes it really easy for people to access their health history, including EOBs and health statements, and other benefit communications all in one place, anytime, anywhere. And third, our provider search. Finding a doctor is the number one reason consumers reach out to us. Tens of millions of people have used this feature on our site and app this year alone. We have now connected our search with claim information and AI and ML to create personalized search results.
These are just a few of the ways we are working to thoughtfully apply new technology to solve meaningful challenges for our consumers. These examples, combined with enhancements to infrastructure and automation across our operation, will translate into significant operational savings in the years to come. This is gonna allow us to invest in benefits and innovation and technology that will drive future growth. Now, I'll turn it over to Vivian and Sandeep, who will share even more about how we're scaling advanced technology.
Thank you, Krista. AI will soon change the way every healthcare plan, care provider, employer, and consumer interacts with healthcare. From our own community of advocates and physicians to our frontline employees and patients, AI, machine learning, and data are simplifying our products and services, and this is just the beginning. The opportunity to use clinical data differently, paired with the safe and responsible use of AI and machine learning, is leading to transformative advances. Sandeep, let's get started and dive into AI.
We are at the cusp of a new era, and generative AI is spurring a groundswell of innovation across UnitedHealth Group. We've identified three core focus areas for our AI strategy. First, administrative simplification. Here's where we can make a big impact quickly, taking friction out of the system in areas like claims processing or provider search and payment integrity. Second, data science platforms and businesses that underpin our growth pillars and capabilities. This is key for enabling value-based care. And finally, medical and clinical insights. Our goal is to free up the clinicians' time so they can focus on the care part of healthcare. Let's review a couple of examples. As Krista said, consumers visit our UHC app or website millions of times a year to look for a doctor. Let's take Jacob here.
He needs to find an urgent care provider, and he starts by using the UnitedHealthcare app. Our AI-enhanced search experience immediately delivers personalized results, finding providers that are high quality, low cost, in-network, and closest to him. All this on an immersive map. He can also search by specialty, such as dermatology, for example, or by symptoms, such as headaches. Thanks to our advances in AI, when Jacob needs a little extra help, he can just type his entire problem in simple language and get fast results. For example, if his child is complaining of stomach pain, he can type, "My son's stomach hurts." You know, many people may not automatically know how to search for a gastroenterologist. But here, using plain, simple language, AI helps drill down to the right care and instantly delivers a list of nearby, in-network pediatric GI specialists.
Lastly, if Jacob searches for, say, something like a broken hand, our search engine finds a hand specialist with matching experience for that specific procedure, not just a general orthopedist. How, you may ask? Our capability uses recent claims data with procedure codes that detail subspecialty and allow us to differentiate the broken hand procedure doctors from all the other orthopedists. So you see here, by combining our member, provider, benefits, claims, and search history datasets, UHG is uniquely positioned to dramatically elevate the search experience.
Remember Linda, our Optum nurse practitioner from earlier? We employ thousands of nurse practitioners just like her. Collectively, they complete upwards of 10 million home visits each year. Our goal, and Judy's, is to always provide the right care for the right person at the right time. But with limited time and resources, we need increasingly real-time clinical insights to manage proactive outreach and ensure thorough health risk identification. We've developed a capability that provides actionable insights to clinicians like Judy and their administrative operations. This capability is underpinned by our integrated medical Rx claims data, as well as EMR records spanning years of recorded outcomes. Here you can see how AI tracked Bessie's diabetes risk over time. The orange line represents her risk levels. Each dot is a point in time where we receive new information. You can see that Bessie's risk has been generally rising over time.
At any point, our nurse practitioner, Judy, can also look into the clinical underlying evidence, understand the rationale for the predictions, helping to make our AI explainable to clinicians deciding on care. These insights form the basis for many possible use cases. I will highlight two examples that are currently being deployed. First, outreach and scheduling operations. Our teams have to prioritize proactive visits amongst large patient populations. By applying developed intelligence across the full population, the patients with the greatest risks are highlighted, helping our operators to schedule in a needs-based priority order. A second instance provides insight during the visit. Let's go back to Bessie's home and Judy's home visit. Judy can review a list of suspected diagnoses and supporting rationale right from her tablet. Seeing Bessie may be at risk for Type 1 diabetes, she can determine if an A1C test is appropriate.
AI is supporting Judy, reducing the likelihood of a misdiagnosis. Judy, like all of our care providers, is the one making the clinical decision.
We employ thousands of call center advocates who answer the phones every day. Advocates like Mike here have one of the most difficult jobs in the company. He not only supports callers during live and complex interactions, but he has to search thousands of documents and then toggle between multiple screens to locate the right information. Then he has to summarize notes before moving on to the next call. Our advocates do an amazing job, but we can do better for them and for those they serve. AI will advance this work. Let me walk you through a simulated call between Maya, a UHC member, and our virtual advocate, Wise Bot, which will gather information to help make Mike's job easier. So picture this: Maya is new to her company's health plan. She calls UnitedHealthcare because she lost her ID cards and wants to get a few questions answered.
First, a virtual advocate, Wise Bot, connects with Maya to verify her information. Now, let me level set. Automated tools like chatbots and Wise Bots have been helping us triage calls for some time now. But through advanced voice technology and generative AI, this initial interaction is now becoming intelligent. It can solve more problems than ever before. It recognizes Maya, answers many of her questions, and provides recommendations based on a nuanced understanding of the conversation. For example, Maya suspects an issue with her thyroid. The bot asks her specific questions, and based on clinical guidelines, it recommends Maya sees an endocrinologist. Now, the Wise Bot could have provided local in-network options to Maya and even scheduled her appointment, and the conversation could have ended there. But today, Maya still has a couple more questions and wants to speak to a real person, like Mike.
So the Wise Bot collects, synthesizes the information, and gets everything ready for Mike, saving them both time. Before Mike even begins his conversation with Maya, he takes a few seconds to review the generative AI summary of her background and the reason for her call. Now, he's ready to help. As the call starts, Maya asks Mike to find her an endocrinologist. Mike uses the same find care functionality we just showed earlier to find a provider in-network based on Maya's location. AI is at work in the background, sifting through information and helping him in real time. Mike no longer needs to toggle from app to app. Here, you'll see on top of the screen, our AI suggests an article for Mike to explain what's covered at her upcoming visit, including benefits like in-network lab work.
Maya also asks Mike if he can help her find a lower-cost option for her allergy prescription. AI auto-generates suggested answers based on the seamless integration with Optum Rx's pricing tool. On the spot, he invites Maya to a screen share so she can review the list of affordable generic options and pharmacies near her home. Maya thanks Mike for all his help, and the call ends. Remember, AI is summarizing the call along the way, so Mike can use that time saved to help the next person who calls. There are dozens more generative AI use cases being rolled out, and as you can see, we are using AI to solve our consumers' most frustrating pain points, support our frontline workforce, and enable clinicians to practice at the top of their license.
Our collective vision is for a world where AI can aid in the prediction and ultimately the prevention of disease.
As I began my civilian career out of the Army, signing up for health benefits did not require a lot of decision-making. I was offered one plan and the option to add vision and dental. That was it. Today, people want real options, coverage designed for what they'll need, and coverage for the unexpected. They want to know which doctors are best and know how much they'll pay before the appointment. That's why we're building these experiences for millions of employers and individuals around the globe, and our customers are responding. Our national accounts business is on track for a record-selling season for 2024. Next year, we'll serve as many as 1.5 million more people through our commercial products. Surest, our fastest-growing commercial offering, is a big reason why. Elizabeth Coonan will show you how it works.
Thanks, Dan. It's a radically different approach to health benefits: no deductibles, no coinsurance. Instead, consumers know their out-of-pocket cost upfront in a simple copay. Using UnitedHealthcare's data to evaluate care provider quality, safety, and effectiveness, we present consumers with clear information and choice in the palm of their hand... Care providers and facilities with the optimal set of attributes are generally assigned a lower copay, creating an ideal alignment of incentives between employers, consumers, and providers. And through a user-friendly digital experience, the plan is designed to make it simple, clear, and easy for consumers to compare care providers and facilities that have been evaluated for quality and value, helping them access higher value care and make decisions that are right for their budgets and individual situations. Let me walk you through the math of a high-cost procedure to underscore the significance of the potential savings.
In Chicago, the in-network contracted price of an outpatient lumbar fusion back surgery can range from $40,000 to $180,000, with comparable quality, depending on which hospital you choose. For a consumer in a traditional plan, and let's assume the plan has a $2,000 deductible, a 20% coinsurance, and $3,500 out-of-pocket max, you may have no way of knowing that the cost varies so widely between the two hospitals you are considering for care, and ultimately, that range in cost is irrelevant to you. Here's why. If you choose the lower-cost hospital, you'd pay your deductible and an additional $1,500 in coinsurance before hitting your out-of-pocket max. Your total cost, $3,500.
Your health plan or employer would pay the difference of $36,500, and it's the same story if you choose the most expensive hospital. You pay the same $3,500 out-of-pocket max amount, but the health plan or employer is now on the hook for more than $176,000, 5 times the lower cost option. In this plan, consumers can know their actual cost in the form of a copay before they schedule surgery. They can shop and choose from providers where the copay for high-value providers is priced lower. We bring that difference into their decision-making process. In the lumbar spine surgery example, the app would display a copay of $1,600 for the high-value hospital and $3,000 for the more expensive hospital.
What's more, the single copay covers all the services and providers during the episode of care, ranging from imaging, anesthesia, lab work, and the surgery itself. By using an intuitive digital experience, upfront cost information, and value-based copays, the consumer saves $1,400 by selecting the high-value option, while the health plan or employer saves more than $135,000. What we find is that more than 90% of the time, consumers are choosing care providers who demonstrate high quality, efficiency, and overall effectiveness of care. And on average, consumers who move from a traditional plan to Surest are paying about 50% less out of pocket. Meanwhile, compared with standard plan designs, employers may reduce their total cost of care by up to 15%, with an average savings of 11% compared with traditional offerings.
In 2021, 1 in 25 of our national account customers offered these plans. For 2024, it will be 1 in 5, and 90% of people re-enroll each year, including the Kueter family. Right, Dan?
That's right, Elizabeth. We are happy customers. There's strong demand for products that enable consumer choice, so we're using insights gleaned from Surest and other products to address another major pain point for employers: helping people engage with the many third-party point solutions they offer, and doing it in one place. Even large employers, managing vendors and evaluating options, can be a chore, so we're going to do that for them. Launching next year, we will integrate more than 20 standalone healthcare programs for healthy living, nutrition, starting a family, cancer care, among others, into their UnitedHealthcare supported benefits platforms. Employers choose what programs to offer, and we make them accessible via our advocates, myuhc.com, and the UnitedHealthcare app.
These are building blocks to a broader goal, developing a truly consumer-oriented marketplace where employees receive a set dollar amount they use to select the products and services that best fit their needs, whether it's more coverage, think lower deductible, enhanced prescription coverage, expanded dental and vision, or clinical programs like diabetes management or additional services focused on family building, app-based health coaching, or wearable technology. It's a consumer coverage model that's vastly different, one that's personalized and customizable.
making accessing healthcare as convenient, connected, and easy to understand as other aspects of daily life.
Using technology to make the consumer experience more convenient and intuitive is exactly what we're doing around healthcare payments. Health payments is a large, often overlooked market that we are uniquely positioned to serve. Our network is connected to over 2.7 million care providers, making payments on behalf of hundreds of health plans. We have relationships with more than 24 million consumers, and our growing retail footprint includes 6 of the 10 largest grocers in America and most pharmacies. We aspire to operate the industry's most trusted, secure payment network, serving as the foundation of our strategy. Now let me hand it over to Betsy with UnitedHealthcare, one of our largest customers, to share more.
Each year, more than $4 trillion of healthcare financial transactions take place. But the payment experience is full of pain points for consumers, care providers, and health plans. It's too complex and full of friction. A year ago, we showed you how we're bringing together our strong network capabilities and broad-reaching relationships across healthcare and retail to create a payment experience unlike any other. Simplifying the consumer experience is a cornerstone of our growth strategy in this market. At the center is our benefits card, with SKU-level adjudication technology riding along the rails of a proprietary world-class payment network. This card is the only card consumers need to access care, shop in stores and online, fill prescriptions, use fitness benefits, spend rewards, pay utility bills, and buy healthy food. All transactions can be viewed by the consumer online.
Today, more than 6.4 million people at UnitedHealthcare are using the card. They've made more than 80 million transactions, amounting to $ billions spent on their health and well-being this year alone. And as more use it, we are seeing strong results, including a nearly 150% increase in digital engagement and almost 10-point increase in NPS, which is driving both satisfaction and retention. No one else in the marketplace brings together network capabilities and cross-system relationships like Optum can, and we are just beginning to realize our full potential.
Let me expand on that. New features coming out in 2024 are all about giving consumers even more convenience and choice by expanding our network to leading e-commerce platforms and related categories. Early next year, we will give consumers easy access to an extensive transportation network. People will be able to schedule rides to medical appointments through an app they likely are already using in their daily lives. They will no longer have to go through their benefits call center to arrange a ride. They also won't have to file a claim and wait to be reimbursed. In addition, consumers will be able to use their benefits for convenient delivery of groceries and over-the-counter products. It's a powerful new way to enable people to access a much underutilized benefit. The difference lies in how our payment network understands transactions.
For example, when a person is checking out, our network can tell the difference between bananas and chocolate, and selectively applies benefits, discounts, and savings to the purchase. Across health plans, more than 15 million people are using our card technology, and we continue to see growth and engagement, with card spend increasing nearly 140% year-over-year to nearly $7 billion. While we primarily offer the card to people on Medicare Advantage and Medicaid plans today, we will be expanding this offering to millions of people in UnitedHealthcare's commercial portfolio, and employers are showing a strong interest. Our longer-term ambition is to make this available to everyone, either through their health benefit plan or employer. Ultimately, consumers are the winners. We are continuing to evolve our network, making it broader and smarter.
The convenience, simplicity, and choice we are giving people is exactly what they are looking for, and it's driving both strong customer loyalty and growth in a whole new way.
In my earliest days as a physician, I learned a tough lesson that I will never forget. I had sent a child home who had been hospitalized with a mild infection, with a prescription for an antibiotic. In less than 24 hours, the child was back, readmitted with sepsis and very sick. The child was readmitted because when the mother took the prescription to the pharmacy, it cost $200 that she didn't have. She was asking friends and family for the money to try to pay for the medicine, but then her child got sick. A scared kid and a terrified parent spent 7 days in a Boston hospital because the antibiotic was unaffordable. Experiences like that one, seeing the realities people face when it comes to paying for medicine and accessing care, inform so much of our work in pharmacy....
As our foundational pharmacy benefit management business continues to grow, we are thoughtfully evolving into the pharmacy of the future, building capabilities to make medicine more affordable and care more accessible for the more than 62 million people we serve, and doing it like no one else can. Let's start with how we are aggressively enhancing consumer affordability, especially for the 15 categories of critical medications, including antibiotics, where we've capped out-of-pocket cost at $35 a month for the vast majority of consumers. Had this program been in place for that family in Boston years ago, that $200 antibiotic would have been more affordable, costing less than $20. This year, we've also introduced a consumer pricing tool that scans and compares prices of generic drugs and automatically provides the most competitive available price, whether that's on benefit or cash price.
More than 3.5 million people have the tool today, and we'll roll it out to nearly 3 million more people next year. We are also supporting pharmacists, especially independent and rural pharmacies. This year, we launched a community pharmacy support services, which included increased reimbursement, access to enhanced tools, and innovative health equity programs. In 2024, we'll be offering a community pharmacy network, which will enable clients to pay pharmacists for additional health interventions. In addition to affordability, access to care is another important factor in driving improved health outcomes. What makes our care services unique is how we reach people. We use the pharmacy as a touch point, as an opportunity to connect people to integrated whole-person care, built around their personal care needs and the way they want to receive that care.
We engage a broad spectrum of individuals with widely varying needs through the pharmacy. 70% of adults take at least one prescription medicine. Some are managing a single chronic condition like high blood pressure, but others are managing complex conditions. Specialty pharmacy drives more than 50% of our total pharmacy revenue. With more than 800 specialty drugs in development, we expect this market to grow double digits each year. Today, Optum's dedicated concierge teams provide support to patients across more than 200 specialty conditions, helping patients manage side effects and engage their care providers. Within the specialty drug population is an even smaller but rapidly expanding group, the more than 30 million Americans managing rare diseases, whose therapies account for about 20% of the spending in the specialty market.
Our pharmacists and clinicians who interact with patients are experts on the condition that their patient is managing. They are well-versed in removing obstacles to care, and they listen and talk with the families to understand exactly what support is needed for that patient. In addition to the people caring for patients, we have an incredibly deep and talented team at OptumRx that is working each day to make pharmacy care services more efficient, more affordable, and more accessible. Let's hear from some of them now.
Caring for our patient means more than filling a prescription. We have the privilege of providing wraparound support for patients with complex therapies that need a little more intervention.
It's really our job to go above and beyond, get to know them, meet them where they're at, and get them comfortable with the process, and help them thrive on their journey.
The whole goal of a pharmacy is to make sure the patients are adhering to the medication and to provide the resources and put together the resources for patients to get access to the healthcare that they deserve.
Our pharmacists tell us that our new pharmacy management system provides them the right information so they can process the prescription efficiently and accurately. We have a collective 99.998% accuracy rate, and retail is only at 98.5%. So we're truly helping to enable patient safety.
We don't want cost to be the barrier that prevents patients from filling a medication. We look for every channel to remove that roadblock. We know that the most important thing is keeping them adherent to therapy. It prevents hospitalizations, which reduces costs for the patients, employers, and their health plans. And so far this year, we've saved patients over $800 million in out-of-pocket costs.
We all work as one because we know behind every prescription is a patient.
That is the future of pharmacy that we are creating, reaching and serving consumers from home delivery to community pharmacy, meeting people where they are every step of the way, from chronic to rare diseases, with affordable access to drugs and comprehensive services delivered as only Optum can. We continue to make investments to streamline prior authorizations, to enhance EMR interoperability and communications, and deliver the right affordable medicine to the right person every time.
Let me close where Dirk started. Those early days at UnitedHealth Group hinted at something special.... It was a time full of decisions that would fundamentally alter our course and the very fabric of who we are. We had learned how to be a health plan, focused on large employers and benefit design at a time when consumers were all but left out of the equation. But there was this momentum, and we could feel it. We could feel the influence of the American consumer in nearly every other aspect of our lives, and that healthcare struggled to keep pace. That restlessness you've seen on display today, it had us thinking: how could we design and push a health system forward to a system that is more responsive, more connected, that offered better choice and real transparency, one that valued their input and put it into practice?
How we answered those questions changed us. Today, we believe value-based care is the best version of healthcare for people. No longer a concept in a journal, but an enduring practice. It is the common thread of this company. It is why care providers make up our largest employee group, and why more than half of our business is built to provide and enable care. For the consumer that is requiring different, the strategy we've stepped through this morning is helping us transform the way we operate, removing waste, cost, and the old rundown things we know people don't like, always rechallenging and reinvesting. With a better understanding of what this future looks like, there are a few things we hope you take away from our time together.
First, we are more confident than we've ever been in our approach to value-based care and the opportunity that lies ahead. We're creating the capacity and capabilities that providers of every shape and size need to make this transition, while empowering our own care teams in markets both new and emerging. Second, our teams are building on the momentum of our benefits innovation, accelerating a consumer-first digital strategy that is offering more than 52 million people more for less. Third, expect our approach to AI and ML to support our progress, removing waste from the system and unlocking efficiencies across our operating model, transforming the ways we are able to invest in this innovation and improve care quality.
Finally, the leaders you've met today are just a small window into the extraordinary, high-performing talent of this company, each of whom are deeply committed to making healthcare work better for everyone. Rechallenging and reinvesting, this is the UnitedHealth Group we're after every day. It's the UnitedHealth Group we've always been. With that, I'll hand the stage over to John Rex.
Good morning. It's great to see all of you here. New location, some new seating, but a lot of familiar faces and long-valued relationships. We so appreciate the commitment you make to spend the day with us, and hope you're finding it worth your while. I know our entire management team gets a lot out of the time with you. Those images behind me on the screens are a sampling of some of the charts, tables, and numbers we've shared with you over the course of this morning. By my count, between the materials that went out earlier and the presentations, you're getting many hundreds of measures of all shapes and sizes. It's a lot of numbers. We all know the phrase, "The numbers speak for themselves," but, and at the risk of being sent to the CFO penalty box, they rarely do.
If they did speak for themselves, none of us would be here today. This combination of past, current, and future measures is one part of communicating the potential of this company and providing you with a sense of our ability to achieve it. But up there, without context, the numbers really don't speak for themselves. It's why we believe that it's important for you to be able to engage directly with dozens of our leaders each year, to get a sense of the qualities that enable us to deliver for the people we serve and how we expect to do so into the future. These efforts reflect a profound ambition for serving others and the nimbleness of our growing organization. Importantly, they also reflect an ability to anticipate, adapt, and consistently perform, even in shifting dynamics. Qualities like these don't just happen.
For me, a couple of traits come to mind that help account for the many measures you've just seen and support our confidence as we look to the future. For the first, I'll borrow the childhood developmental term, temporal awareness. That's the core human ability to connect time with movement. A toddler, for example, has to learn the relationship between how long it takes to move the spoon from a bowl to her mouth, so that her mouth opens in time. An older child learns how to anticipate more complex time frames, such as how long it takes to get a soccer ball from a player's foot to the goal.... For us, it develops into keeping at our forefront multiple time horizons as we make decisions about our businesses, and about taking steps to ensure success at different times and, of course, under different circumstances.
All of you who invest with us do so for a variety of reasons, and with a variety of time horizons: 1 year, 5 years, even decades. All reasonable, and when it comes down to it, most of you take all these various time frames into account to inform your own decision making. Likewise, so do we. It can be a demanding balance, but it makes us better. We feel highly accountable for delivering strong performance across all periods for patients, care providers, consumers, customers of all sizes, and of course, for you, our shareholders. The second trait is fundamental to the first: continuous improvement, especially in cycle times and execution. While there are moments when aspects of healthcare shift abruptly, it often evolves more gradually, largely because there is so much at stake for people.
Regardless of pace, the benefits of taking months, days, even minutes off out of our cycle times are amplified by our market presence and the breadth of our capabilities. Trimming 1 day may not sound like much, but multiply that across the efforts of more than 400,000 dedicated colleagues serving more than 150 million people. For example, about 4 years ago, it took us 36-48 months to fully transition a fee-for-service medical group to a successful value-based practice. Today, we accomplish this in 18-24 months, delivering greater value sooner for patients and care providers. Another example. Earlier today, you heard about innovations in benefit offerings. These are a direct result of accelerating our digital development efforts, where just this year, we drove a 5-fold increase in the number of mobile features delivered, resulting in a multi-factor increase in consumer engagement.
With this approach to performance and keeping multiple time horizons in mind, we constantly evaluate how we can apply our capabilities in new ways to anticipate and meet the changing health needs of the people we serve, the needs of today and those on the more distant horizon. Just as a child advances in temporal awareness through trial, error, and continual learning, we innovate, test, and nurture the businesses that will be the franchises of UnitedHealth Group in the near, mid, and long term. It's not an either/or, it's all of the above. Thus, Optum Health's value-based care initiatives are today a significant contributor to our near-term growth and will continue to be over the extended long term. Care in the home is proving to be highly effective. We see expansive potential there over the mid and the long term.
Our pharmacy businesses have a multi-decade trajectory as specialty drugs expand, and as one of the few stakeholders with the incentive to drive both quality and value. Health financial service offerings have the distinctive ability to simplify consumer and care provider experiences. Think care delivery ten years ago. Our benefits businesses remain foundational and central to our ability to serve people across all time horizons. Our responsibility is to ensure each business is receiving the right support and investment wherever it sits along the temporal spectrum. Being both adaptable and consistent enables us to reliably deliver for the people we serve. That brings us back to some of those numbers we shared at the top, starting with a brief recap of 2023.
As noted with our third quarter report, we expect the adjusted earnings to be in the range of $24.85-$25 per share. The growth comes from across the enterprise, with particular strength in Optum Health as it serves more patients in value-based care and in UnitedHealthcare as more consumers and employers choose its benefit offerings. Consistent with our mid-year comments, we expect our 2023 medical care ratio to be at the upper end of our initial range. Moving nimbly to address shifting care patterns is a good example of that temporal awareness and improved speed at work. We adapted rapidly and made timely adjustments for next year. Moving now to 2024. Our initial adjusted earnings outlook is $27.50-$28 per share, with growth across the enterprise....
Revenues of $400 billion reflect growth of $30 billion, even when incorporating the significant effects of the Medicare funding reductions. We expect a full-year medical care ratio of 84%, ±50 basis points. This is driven by those Medicare revenue impacts and business mix, particularly our growing public sector offerings for the historically underserved. Optum revenues will grow by 11% in 2024 to over $250 billion. This diversified growth will be led by Optum Health, with the number of patients served in value-based care increasing by 750,000, consistent with our 2023 stepping-out point. At Optum Health, revenues will approach $110 billion, growth of $15 billion or 16%. Key drivers include value-based care patients and expanding and deepening the levels and types of care we offer, so we can serve patients more comprehensively.
Our capacities and cycle times have advanced strongly in these areas, and we've established great foundations for expansion. Even with over 4 million value-based patients served today, when considered in the context of the needs and market size, it is a small fraction of the vast potential. Our intent is to continue to expand these offerings for seniors and continue to invest today for long-term expansion of other areas, including commercial and state programs. That's because we see value-based care as fundamental to the shared goal of improving health outcomes for people and costs for society. Revenues at Optum Insight are expected to increase to about $22 billion, and the revenue backlog will approach $35 billion, growth of $3 billion.
The expanding capacities of our offerings, in particular, the number of care providers and consumers with whom we can connect and the ways we can connect with them, are important elements of our objective to improve experience and system performance. Optum Insight is also developing offerings in new areas our customers value highly, such as AI-first process optimization, advanced quality services, and broadened health system partnerships. At Optum Rx, revenues will increase to $125 billion, growth of about $10 billion. There are multiple pathways on multiple timelines to continue this growth far into the future. Our pharmacy services are growing strongly in many areas. We see a rising need for our unique ability to offer deep clinical support and value for patients and care providers as more specialty drugs come to market.
Heading into 2024, OptumRx has had another strong selling season and high customer retention, reflecting our ability to anticipate and quickly adapt to changing customer preferences and market dynamics. Turning to UnitedHealthcare, revenues will exceed $300 billion, reflecting diversified growth of over $20 billion across our offerings. In our commercial products, we expect another strong year of growth, adding 1.5 million consumers. This growth will be led by self-funded offerings, which serve larger employers who are among the most sophisticated buyers of health benefits. These customers are responding positively to the innovative products our teams are introducing. Across our Medicare, individual, group, and dual special needs offerings, we expect to serve up to 550,000 more consumers. Strong growth, while not matching the nearly 1 million added this year. And let me tell you why.
We consciously and strategically approached 2024 with balance, with multiple time frames in mind, keeping benefits as stable as possible for seniors while adapting to program funding changes and care patterns. Again, not an either/or. Our long-held approach drives sustainable growth, consistent performance, and durable consumer relationships. With only half of seniors in Medicare Advantage today, the growth outlook will remain strong for years to come. In Medicaid, we expect the state's redetermination processes will be more than halfway complete by year end. Our focus has been on engaging with individuals who have been displaced and helping them find other affordable health coverages or retain existing coverages, and we have been able to secure coverage for the majority of those with whom we engage.
In 2024, we expect the number of consumers served by Community and State to decline 100,000-200,000, with their redetermination impacts partially offset by growth in other areas, such as our North Carolina expansion and new opportunities in several states. Our growing businesses support and are supported by substantial financial capacity and a strong balance sheet. Cash flow from operations in 2024 will approach $31 billion, or 1.2 times net income. Returning capital to you, our shareholders, is an enduring commitment. In 2023, we will return nearly $15 billion through dividends and share repurchase, a 14% increase over last year. Our annual dividend has grown by double digits for well over a decade, and share repurchase has been both consistent and meaningful over time.
You can expect us to continue to grow the amount of capital we return to you in 2024 and beyond. Even with this level of activity, our growth capital capacities remain strong. Over the past two years, we have deployed well over $30 billion, and we are steadfast in our commitment to building long-term value by strengthening our capabilities through internal investment and strategic combinations. Our capital deployment approach reflects the fact that the nearly $5 trillion U.S. healthcare system remains highly fragmented, resulting in uneven quality and outcomes for people and higher costs for all. Helping to smooth the patient experience, improve quality and outcomes, align incentives, and reduce costs remains at the very core of our mission and underpins our every investment decision. These numbers we have provided you today reflect the temporal awareness I mentioned earlier.
They are the result of decisions made 10 years ago, one year ago, even a month ago, and those decisions were made with the conscious perspective of the near, mid-, and long-term positive impact we can deliver for the people we are privileged to serve. Further, they fully support continued delivery upon our long-term 13%-16% earnings growth objective far into the future. With that, we thank you for listening, and again, for spending the day with us. We hope you have a sense of the, our confidence in the opportunities ahead and our ability to execute on them. And now we'll take just a moment to set up for our Q&A session.
Please take your seats. We are ready to resume. Thank you.
Thank you, everybody, for spending the time this morning with us, listening, and now it's our pleasure to give you the opportunity to ask questions. So if I could ask some of the team to come back up onto the stage to take your seats, we'll get ready to start that just as soon as we can. In addition to people you've already met today, you're gonna meet with Erin McSweeney, who's our Chief People Officer, and Patricia Lewis, who is our Chief Sustainability Officer and leads all of our ESG agenda across the company. Otherwise, you've met everybody else at some point during the morning already. If you do have a question, if you could just raise your hand. Zach and Julie are both in the audience.
They'll get to you, and I'll literally flip-flop between Julie and Zach. If you could just wait until you get the mic before you start, then folks who are listening in can also hear you. Zach, if you're ready, let's go.
In the back, Andrew, we have Steve Baxter from Wells Fargo.
Hey, Steve.
Hey, thanks for the question, all the information. Just a couple on the commercial business. I guess the commercial self-funded growth really stands out. Can you talk a little about how much of that is being driven by Surest specifically? And then within the commercial value-based care opportunity, I think the, you know, 20% type growth you're expecting, you know, from a market share perspective, 1% of your book is maybe only 50 basis points on an annualized basis. What could lead to that ultimately developing more quickly than that? What would you need to see from employers and their response? Thanks.
Steve, thanks so much. Brian?
Sure, there's a variety of factors driving the growth in our ASO business here. Surest is certainly one of them, but one of many. I think the strength of our network has really differentiated itself, and I think I would just point out product innovation overall. Our advocacy model has really emerged. It's been something we've invested meaningfully in over the last couple of years, and you heard about how we're bringing together a variety of point solutions into a single system that is very different for UnitedHealthcare, and I think the culmination of all of those elements with Surest as a really fresh, new element that we've been bringing to new customers has driven, not only this year, but two years in a row, really strong growth overall.
When I think about commercial capitation, last year we talked about that as a key driver for our ambitions coming into this year, and I think what I'm most proud of. First and foremost, we have 500,000 lives in commercial cap today. I think that's oftentimes lost.
But what I'm most proud of as we look to this year is what we're doing in the individual and family plans. I think you remember we had Tony Lin up here last year. We talked about the ambitions of joining with him and learning from his capitation in other marketplaces, and it is a really strong grower for us right now in our annual enrollment period for the individual and family plans, we're seeing that really emerge. So pleased with our traction in capitation and a variety of factors, certainly one of which is Surest for our overall growth and momentum in self-funded.
Great. Thanks, Brian. Julie?
We have Ann Hynes from Mizuho.
Great, thank you. So Medicare Advantage penetration is now 50%. What do you think the max penetration is, and over what time? And is there something structural that over time you couldn't get to 90 or 95% ?
Anne, thanks so much. Let me ask, Tim, Tim Noel, I think you have a mic over on the far left there. Tim, do you want to address that?
Yes, thanks for the question. You know, when I think about that question, the first place I start is the overall value proposition of Medicare Advantage, and when you think about the alternatives, Medicare Advantage is just unmatched in the cost to consumers, the outcomes, the satisfaction. So, you know, I see a lot of runway north of this 50% rate that we sit at today. And the rate that we've talked about of 7%-9% growth in the overall industry is something that I still view in the foreseeable future as the right place to orientate around. And I think there's, you know, a variety of different coverage types that we're starting to find inroads into in Medicare Advantage.
But again, I just think the overall value proposition that has been resonating with consumers so much recently will continue to.
Great. Thanks, Tim. Zach?
Going to the front, Josh Raskin from Nephron Research.
Hi, thanks. I've got a sort of a two-parter, both on the value-based care. So the first is, just help us understand what fully accountable really means, is that capitation, and I'm specifically interested in how the provider benefits financially in these relationships. And then second, could you talk a little bit more, I'm hearing more about this provider enablement strategy now, and I'm curious if that's part of Optum Insight and not Optum Health, and what really is the opportunity and what you're trying to do there?
Yeah, Josh, thanks so much for the question. Amar, if you want to pick up the first point around fully capitated-
Capitate
and accountable, and Roger, if you'd then pick up Practice Extend and the like, that would be great.
Yep.
Thanks. Amar.
Thanks for the question, Josh. So on the fully accountable point, it's exactly that. It's capitation payment for our provider network. Obviously, in some cases, it's within the context of our employed physician base. In other cases, we're doing that with a broader network of contracted providers. The capitation premium is delegated down to Optum Health as a care delivery organization, and then importantly, within that, we're making investments, right? Investments in technology, investments in clinical programs, investments in practice support. And to your question around how do the providers benefit, it is to actually be able to deliver within a much more outcomes, quality-oriented program to best benefit the patients, but also create a much better practice environment for them and their teams.
Do you want to just make a comment on relative burnout rates between those-
Yeah
folks who are in this model versus Fee-for-Service?
Yeah, and thanks, Andrew. Yeah, so, you know, to my point around practice support, administrative complexity, a lot of the things that bring fulfillment in the practice of medicine, what we've found within our model is 21% reduced burnout rates relative to a benchmark. So physicians, care providers get to do more of the care, less of the pieces that create challenges, some of the challenges in the day-to-day. And most importantly, the patients also get to engage with their providers much more around the practice of medicine and the clinical issues that are going on. Thank you.
And that's great, a great response, I think, Amar. And I think, Josh, if you also just extend a little bit, think about the video you saw of a physician in New York, in Hudson Valley. She was talking there about how she spends some of the day in value-based care and some of the day in fee-for-service, and that's where a lot of the space and the capacity is for us to extend our value-based platform, right? So particularly, obviously, more seniors potentially, but also as those commercial lives become more interested in or available for a, a value-based approach. So, so as you look at that blend of what a typical clinic, we have relatively few, few pure senior-only clinics. We have very much more the kind of blended clinic mix.
That's why we see this model very applicable, whether it's a senior, whether it's commercial, whether it's Medicaid, and actually, once the physician's got comfortable with that way of working, it makes more sense for them to just carry on working that way the whole day.
Mm.
So as we start to bring in lives in that kind of shape, it actually makes life a lot easier for the clinics 'cause they start to shift over that way. Roger, do you want to touch on enablement?
Yeah, on provider risk enablement, what I would say is, obviously, the transition to value-based care is such a big market driver at Optum Insight. We're looking at that very hard in terms of opportunity to innovate and to bring products to the market, and we're doing that, as I mentioned on the stage. Practice Extend is our offering. That is where we're working with providers from a payer side, to work with them and bring, let's really call it value-based care in a box. 'Cause many of our providers that we're working with really don't know all of the stepping stones and all of the things that they need to go on that journey, and we're bringing that, and the feedback is actually very strong.
So it includes everything from the roadmap to get there, the need for population health analytics, what they need in terms of just contracting, both with the payer and the provider, and we're solving all those problems for them. We're gonna take Practice Extend and also extend it then and go straight to providers, and I think that's where we're very well-placed. We have access to a very large market. With our large health system partnerships, we're also talking to them about using those same tools on their value-based care journey, too. In terms of how we work with Optum Health complete partnership, we just pick the best tool that exists in this group to put it in that toolbox that I described.
This whole area of physician enablement, taking the kind of insights and the models we've been spinning up over the last several years around value-based, it's just another example of how at United we work to innovate, oftentimes UHC, Optum together, innovating, identify, test drive, pilot. Those things that succeed, we take them out into the broader marketplace, right? So, whether it's UCard, whether it's physician enablement, whether it's payment integrity insights, whatever it is, the goal of the company is to work together, figure out how to innovate, test drive it, and then make it broadly available, not just through our own networks, and that's been a very successful model for us now over many years in many different areas. Julie?
Yep. Kevin Fischbeck from Bank of America.
Hey, Kevin.
Hey, thanks. So I guess I wanted to know a little bit more about the, the shift of value-based care into commercial and Medicaid. I think you gave us a little less than 505 million, about 4,000 in commercial. So what, what's the Medicaid percentage today in value-based care? And as you think about adding the next 5 million lives, what does that mix start to look like? And, you know, I guess to your point, Andrew, how much of that growth in the non-Medicare is about an existing physician panel that has commercial Medicaids shifting over versus having to go out and find a different type of doctor who's maybe more commercially oriented or more Medicaid oriented to make that?
Great questions. Brian, do you want to start off-
Sure
on the Medicaid piece?
Well, for me, Medicaid includes duals and our complex care, and it's been a big driver of where we've seen that growth this year and into next. So keep in mind, many of our duals we consider inside our community and state business, and complex care, I think, is the perfect sweet spot and inter- and intersection of our capabilities in UnitedHealthcare and Optum. And that's grown nicely, and I continue to see that grow at the same rate that we've seen, the last couple of years for many years to come. So first and foremost, it's in complex care. We haven't seen much value-based care in the traditional Medicaid side yet. I'd say that's in the really nascent stages.
And then back to commercial, right now, the bias is towards a real fast mover in the individual and family plans and continuing to grow nicely, again, inside our commercial book. I also want to point out a capability we have called Level 2, where we're actually taking risk back from some of our ASO customers on complex diseases, in particular diabetes, and that's grown nicely for us here into 2023 and 2024 as well. So still a variety of different ways that we're growing outside of the Medicare Advantage business.
Yeah, and I think from a perspective of where we would go to essentially create the physician capacity to absorb that kind of growth. Firstly, as I said earlier, many of our clinics already have a blended population running through them. But where that doesn't necessarily match, we've got the home and community platform, which has played a big role this year in absorbing a very substantial increase, particularly in the dual special needs. It's allowed us to go much more into rural areas, much less populated areas. Our partnership with Walmart is another way in which we've taken an opening up strategy of clinic access for value-based care into geographies where you may not historically have found a very high density of clinic presence.
And then, of course, the way in which Amar builds out his organization, some of the physicians are employed by United, some are contracted, some are affiliated. So that's a very flexible mechanism to increase the kind of hinterland of the Optum Health platform. So if you think about all of those dimensions, the opportunity for us to shift and move and build capacity underneath an evolving market need is strong. It takes us probably a year or two to get it right to the right level, and you've seen a bit of that this year as we've extended our home and community to meet the outsized growth we saw in the duals this year. You're gonna see the benefits of that in 2024. But the bottom line is, over any sort of sensible period, we can be pretty responsive to those shifts.
Um, Zach?
Lisa Gill from J.P. Morgan.
Thanks very much. You talked today about the changes for Medicare Advantage and the risk adjustments for 2024, 2025, 2026. As I think about it, specifically to 2024, how much of that is borne on the side of Medicare Advantage versus Optum Health? And specific to Optum Health, we're looking at the margins improving in 2024, so just curious if that is a big headwind there, what are some of the other things that are either offsetting it or improving as we move into 2024?
That's a great question, Lisa. So clearly, it affects both businesses. So again, you know, what we're really talking about, the best way to think about it, Lisa, the way I think about this, is it's essentially a price cut on MA, and so that price cut comes in at the top. Obviously, some underlying lives remain held in UHC. That price cut therefore affects UHC's MA book. But the lives which have been delegated to Optum, it essentially then flows into Optum as a price cut, right? So the same kind of phenomena flows in. The responses are kind of the same mix.
So both businesses have response capabilities, which are around choices on benefit design, obviously, choices on taking cost out of our own organization and driving, let's call it, internal efficiency as a contributor toward responding to that pressure like any normal company would do. And then the third area, which I would say is particularly important within Optum Health, is doubling down on the affordability, so elimination of waste and unnecessary care within the system, which in many ways, I think ought to be a key tenet of value-based care anyway. You know, it is already, and in many ways, it's why I said at the beginning, if there's a good thing from all of this, it's the catalyzing effect to double down on that piece of the agenda. That's how we respond.
Now, to the issue of why you're seeing health margins strengthen during 2024, yes, you have the headwind of the rate notice, which is gonna flow through the next three years, but you have tremendous underlying mix dynamics changing as you see these large cohorts, which have come into the company over the last 24 months, move into a much higher level of managed stability, so higher levels of engagement. The key for you, the key for the strong performance of health is obviously grow the number of lives, then achieve good, strong, relevant engagement, allowing us to work with the patients and get their care under control. Because a lot of these lives come in with very unattractive BCRs or MCRs, right?
They, they come in pretty much uncontrolled, not well-managed, particularly in the duals. They've almost been lost to the system in some cases. What we're doing, particularly through home and community, reaching out maybe for the very first time in a comprehensive engagement, takes a little while to do that. You've seen that this year. Once it starts happening, that's gonna be a big piece of it. So it's a combination of the cost management, the affordability agenda, the mix dynamic all plays out. And what I hope you will all take away is that we've made very, very deliberate decisions and trade-offs in 2024, not just for 2024, but to make sure we're positioned for 2025 and 2026, because the rate notice drops, you know, three years, not one year. Julie?
Yep. In the front, we have Dave Windley from Jefferies.
Thanks. In light of, Andrew, your comments that you just made around Optum Health and the maturing of some of the cohorts, your guidance for MLR in 2024 is higher. So what is... If not O Health and the headwinds that you just highlighted, what is driving the higher MLR and kind of the conservative posture maybe around that? Thanks.
Yeah, so let me - I'm gonna ask John to comment on that in a minute. But just to be super simple, again, that price cut has a direct effect on, on MLR. I mean, it, it is a straightforward shift in the denominator. You immediately get it, and it represents the bulk of what you're seeing in the change. But let, let me ask John to go a little deeper on that.
Sure, that and that's really it. Really, the funding changes took $ billions out of the system, essentially, and revenue is the denominator in this, and that impacts the denominator in calculating the medical care ratio. And so it has impact as that flows through. And I don't wanna—we none of us want to underplay that impact. It's a significant impact in terms of the $ billions that came out of the system, and this is what Andrew and the team have been talking about in terms of as we started in February, looking at how we'd approach it thoughtfully, almost like a long-term planning process, right, for us, in terms of looking ahead over the next few years.
So that's it, and then making sure that we are able to do all we could to keep benefits as stable as possible as we could for seniors as we work through that process. So maintain as much stability as possible, but the denominator change was significant.
Yeah. And I think, you know, as you think through the next three years, the way we think about it is external event happens, puts pressure on the MCR, puts pressure on the revenue, puts pressure on the MCR. We respond to that in the way I've just described. We believe that is a response model, which is very durable. So it's not like you're just breathing in for twelve months and you can't sustain it, you have to breathe out at month thirteen. This is a situation where we truly think we're shifting the shape of our cost base, shifting the shape of our affordability capabilities externally.
What that will do over time, so in the short run, what that does, and you see it in our guidance, despite the movement, little bit of movement in the MCR for the reason we've just discussed, overall earnings performance continues to be exactly where you'd hope it to be. That's due to all of these other pieces being addressed in response, and then as you roll through the next two or three years, you'll see things like affordability agendas and the like ought to start to help us rebuild the MCR position, right? So you're starting to get at the core, 'cause MCR is obviously a function of the revenues and your underlying medical costs. So how we, how we really tackle that over the next two or three years will start to address how we, we, manage the MCR going forward.
So, I think that's that. Yeah.
Down in the front, we have Scott Fidel from Stephens.
Hey, Scott.
Oh, hi, thanks. First, just to follow up on the MLR. So basically, it sounds like you're thinking about 2024 as sort of the arriving at sort of a peak level for MLR, that then you could try to work, work through over the next few years, 'cause obviously, we have we do have the incremental risk model, you know, pressures coming in 2025 and 2026. And then my main question was just, was hoping that you could maybe drill a little bit into your expectations for D-SNP market growth, specifically. That's been a really strong driver of growth for the industry. United's achieved almost 40% market share there.
We have heard about some more variability, though, in some of the competitor offerings in that particular, category for 2024, so just curious in terms of how that, that drives your thinking on D-SNP growth?
No, that's a great question, Scott. So maybe, Brian, if you might like to start on the duals, and then, Amar, I'd maybe ask you to talk a little bit about how it represents within the 750,000 growth in value-based lives next year. But maybe, Brian, if you could start.
Sure. On duals, you heard the $450-$550 range. Inside that, I'd say it's pretty well balanced between duals growth, individual Medicare Advantage, and our group growth. So expecting continued growth, albeit a little more tempered in comparison to what we've seen the last couple of years. As you pointed out, we have seen a strengthening in some of the benefits as we approach this year. As you heard from John, we're taking a very multi-view approach, multi-year approach, I should say, to how we've positioned our 2024, and really wouldn't change a thing. I think as we look over the long term of this three-year period, it's important that we feel good about our pricing going into 2025 and 2026.
Certainly from this vantage point, I feel very good about the benefits that we've put in the marketplace, the pricing, et cetera, how we've accommodated for some trend elements that we spoke about earlier in the year. So feel really good about where we're positioned. Do expect to continue to grow it, and of that overall MA growth, about a third of it, pretty well balanced, again, between those three products.
... and for health, look, when we think about all of our growth, it's related to our plan partners or geographies and the places where we're building out our networks. And consistent with Brian's comments-
Mm
. you know, we will expect to continue to grow within the duals base. We're intensifying some of the work that Andrew talked about in terms of patient engagement with the most complex of those members, particularly around home-based care. So we've built more of the home capacity within those geographies and expect it to be a continued important part of our growth.
Yep. Excellent. Thank you. Julie?
Over here to Whit Mayo from... Oh, never mind. George, George Hill from Deutsche Bank.
Yep. Good morning, guys. Thank you. I kind of wanted to come back to the risk model and the changes in the reimbursement environment again in MA.
Mm.
I was just wondering if you could talk a little bit more about how you, how that changes how you contract and interact with your risk-bearing provider organization partners, both as, as the Medicare Advantage plans contract with Optum Health and other provider organizations. I guess, can you talk about how you guys change the allocation of economics, or how you work to support your provider partners as both internally and externally?
Yeah, again, maybe I'll ask... In a second, I'll ask Amar just to reflect on how it's felt from the non-UHC payers, but maybe, Brian, you might want to address how you've looked at it as the UHC payer to Optum.
Yeah, absolutely. Well, we talk a lot about stability and benefits, and I think it's equally important to talk about stability and network in our partnerships, particularly in a fully accountable arrangement. So first and foremost, we are very transparent and make sure that as we approach a year, our provider partners, particularly those that take risk, are fully aware of the changes and implications. So just as I try to protect my benefits, I want to make sure that the relationships we have stay in place for a very long time. I think you will see some disruption in this marketplace with provider partners over time. We've seen it in the past in other markets, and it's certainly not our intention to do that.
We are fully receptive to, and make sure that we've got full awareness to, the capitation rate changes, et cetera, the implications, and then how we together go to market with benefits.
Yeah.
Yeah, I know, as we think about our external payer partners, as well as comments around the provider networks, I mean, the core piece of this is the level of relationships we've had with these providers over many, many years around value-based constructs and around risk models. And so there is a ton of provider education that is going on, both around areas like diagnosis and documentation, but also, to Andrew's point around affordability and medical management and our clinical programs, how do we build and grow the clinical programs together with our physician partners, with the medical groups, both our employed as well as our contracted physicians?
That provider education process, just to be super clear, is about talking about specifically how has the diagnosis models changes, how do you do education around what goes on in the clinics, how through our physician portals and other technology do we support them to make the right, both, documentation decisions, but also gaps in care and quality decisions? So all of that goes into supporting them through the risk model change.
I think central to both UHC's logic of how it thinks about its relationship with Optum, and also very much what we're seeing from non-UHG payers of Optum, is Optum Health has got real credibility in what it has delivered for those payers over the years. And obviously, as you see this group, this type of population grow in terms of value-based care, payers want to sustain that. They want to see that sustained.
And so when you see something like this funding reduction flow through, which obviously is gonna have an effect both at the payer level and the provider level, people are looking to say, "Okay, how do we make sure we don't have what ought to be a manageable event over several years become a distraction?" And I've actually been very impressed by the kind of the way in which the other payers have come into this conversation, and the way in which Brian and his team have come into this conversation-
Mm-hmm
to say, "Look, actually, this whole thing is much bigger than a rate notice change. This whole thing is about how do we work together to sustain value-based care growth?" And that's what got us into a good position in terms of how we manage through this period, and how we feel like we have a pretty decent, let's call it new foundation, post-rate notice, to plan for 2024, 2025, 2026, which is exactly what you're seeing play out.
Mm.
Zach?
Coming to the front again, Lance Wilkes from Bernstein.
Hi. Question on the overarching strategy going forward with Optum Insight. What I was particularly interested in is how you look at distribution to the provider organizations, how you're looking at AI enablement for care extension, and maybe using Optum Health as a customer, and what the outlook is for that. Then I'm also interested in that value-based care enablement aspect that was asked earlier. You know, how much of that is embedded in Insight today as far as the capability, versus how much of it is embedded in Health?
That's a great question. So I think Optum Insight, you know, we've had now two or three years where we've been waiting for and then executing the transaction with change. And, you know, I think it's inescapable that during that period, there's a heavy focus on that process. I think as that closed out in the middle of this year, and with the new management team well and truly established, what we're now seeing is a much more exciting future for Optum Insight. It largely stimulated by the integration, because change brings in a lot of new capabilities, a lot of new network connectivity, which you see a little bit echoed in the financial service conversation.
When you then start to say, "Okay, what could this business now do as a not just a B2B business," which I think is what you might characterize the old Optum Insight, but much more as an organization which not only supports big other businesses in healthcare, like hospital systems, but also, how does it support the small providers? You heard Roger just talk about that. How does it actually start to power some of the consumer agenda? How does it start to drive much greater insights from the information that we have that providers, consumers have given us about themselves, how can we help them do that? And so the agenda that Vivian and Sandeep began to lay out all plays into the innovation agenda for Optum Insight. I'd say all of which is not in the run rates.
But I think there's a remarkable opening up of potential around Optum Insight as it really starts to move on from the integration moment. Maybe Rog, you might want to add a couple of comments.
Yes, sure.
Sandeep, I'd love to hear just a couple of your kind of, you know, the next things that we're working on.
I think honestly, when you look at what has happened now that the Change portfolio is in, I think there is a unique portfolio to the offered to the whole industry from Optum Insight. You look at the service offering, the software-enabled services, yes, but just look at some of the software assets that come in as part of the Change portfolio. There's the leading clinical guideline tool in InterQual, and that's not even a product, that is a portfolio. That is, I think, something that we're gonna build off going forward. Then you look at, in the revenue cycle, software like Assurance, again, a leading software package.
I mention these point solutions because to Andrew's point, we think the next stage is about how we connect these point solutions to actually differentiate and bring differentiated assets to the market, whether that be in administrative efficiency using AI working with Sandeep, or actually taking the something as basic as the payment cycle in this industry and turning it on its head 'cause we can link those elements together to do claims faster, more accurately, and settle more quickly. We think that could be transformative.
Yeah, and just building up on that, you know, 10 years back we had this big step up of reading clinical charts using AI, and that was like the holy grail to step up on capabilities. Optum Insight had a capability, Clinical Language Intelligence using natural language programming. Now, Roger has that in 7 products for different things, whether it's, you know, determining prior auths or claims or medical necessity and so on and so forth. We're just taking that a step forward with generative AI. So to Andrew's point, how Optum and UHC innovate together and then use Roger to sort of spread that innovation across the industry just comes to life. AI is gonna be one leading way of doing it.
Great. Thanks, Sandeep. I think we have time for maybe one last question. Julie?
Over here, over here we have John Ransom from Raymond James.
Following up on that, interesting discussion at Optum Insight, a picky unit, financial question. I think the company has said that you managed the EBITDA down at Change to basically zero in the first half of the year. How do we think about the margin progression of Change Healthcare back half of 2023 and 2024, and how much of a good guy is it for, Optum Insight margins? Thanks.
Uh, John?
So you're absolutely right, John. So last year was a big year of investment, as we looked to accomplish the integration of Change in a more compressed time period than perhaps we had set out envisioned initially. But very important to get that done and get it done as quickly as we could to move on with some of the things that Roger is talking about in terms of as we move through this period. So, yeah, very supportive in terms of the last year probably was a year of investment in just in terms of the integration component. Roger is building out a lot of tools-
Yes
so you can see kind of that we, where we set up in terms of the, both the margin for all of Optum Insight for this year and kind of the range that we, that we set out here for the, for the long term. So that will increasingly be, additive to Optum Insight and their operating earnings, growth over the next several years. Some really super interesting, compelling build opportunities we have here as we manage within that also, though. So think of we spent well on the integration during last year. We're moving on to some of the build and growth opportunities that Roger's pursuing right now.
Doug, I mean, just pick it up on that. Doug, do you want to just comment on the, on the way in which Change is helping us re-envision financial services and, and, and all of that? 'Cause it... Remember, you know, some of, some of the Change impact picks up within Optum Insight. Financial Services sits within Optum Health, so some, some of the value of the acquisition of Change is gonna play out through that agenda, and, and Doug, you might want to just update folks about that.
Yeah, thanks. I think if you look broadly, what we've tried to do, as John mentioned very well, we've done a lot of the integration work this year. The next step is really to be able to develop more broad products within Optum Insight, and we mentioned a few of them today. The first one is clearly provider enablement, clinical decision support. Roger mentioned InterQual, about how we've been expanding our ability to actually deliver software and get really granular about one of the things that, you know, the hospital systems are looking for from us.
You know, within the middle of the revenue cycle, I was talking to a prospect that we have, and she said: "Look, we don't have things like natural language processing in the middle of the revenue cycle to be able to code more accurately, to be able to improve the way we code, to reduce friction between the payer and us." So that kind of tool is important, but I would say with respect to financial services, you know, one of the key thing is our ability to get to real-time settlement over time, right? A lot of what we are doing today involves, you know, taking waste out of the system with payment integrity and revenue cycle management. We're sort of moving the waste down, right?
What we want to do is try to reinvent that, to have these, these less friction, to have the payments be much more seamless between payers and providers. So a big part of the system is that payment technology and make it work really seamlessly within the claim payment process.
Great. Thanks, Doug. I'm afraid we're out of time, unbelievably. That went incredibly quickly. Let me first of all just say a very big thank you for you all spending the time with us this morning, and I hope you got a sense of the agenda that's laid out for us at UnitedHealth Group, both in terms of how we're responding to short-term events, which of course they happen, but more importantly, the progress we've made over the last several years to bring together many aspects, components, individual parts of our capabilities, really starting to bring that together behind these driving agendas of really being a leader in value-based care, because we do think it's the best-...
way to deliver care and empowering the U.S. healthcare consumer, because we believe over the next decade or so, that will be an absolutely must-win agenda for a company like this. And I hope what you saw today was, you know, maybe a selection of ideas you've heard before, but actually suddenly, wow, they're actually on apps and millions of people have them, and they work. They're not just theories, they're not just, things that appeared in journals, as somebody said earlier on the stage, but they're now appearing. And by the way, it's not just one thing, it's many things all being pulled together. And really behind all of that, what we're trying to do is take all of the complexity of the U.S. healthcare system.
What we can't streamline, we're gonna basically hide from the consumer in the sense of why do we need to expose all this complexity? Can't we just be a great translator of what this incredible system tries to achieve and just make it easy for everybody to engage with? That's what I hope you take away from today. I hope you get a sense of real progress and momentum around it. Finally, I also hope you very much take away our super strong commitment to continue to deliver for our shareholders and owners. You're incredibly important to us. We can only do what we do with the support that you give us. I hope that you feel that what we're laying out for you is ambitious.
We believe it continues to demonstrate the application of some of the best minds in healthcare, combined with, without doubt, the most committed workforce in healthcare to deliver every single day for literally tens of millions of people across this country and beyond. We hope that that continues to demonstrate to you the seriousness with which we undertake our mission on behalf of the people who rely on us and on behalf of the people who own us. Thank you very much for today, and we look forward to plenty more engagement during the rest of the seminars. Thank you.