Good morning, everybody. Our presentation today contains forward-looking statements within the meaning of U.S. federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. A description of certain of these risks and uncertainties can be found in our reports filed from time to time with the U.S. Securities and Exchange Commission, including the cautionary statements included in our annual reports on Form 10-K and quarterly reports on Form 10-Q. Thank you.
Julie. Yeah. Thanks, everyone, for joining us this morning for the second day of the conference. Really pleased to start off with UnitedHealthcare. As I'm sure almost goes without saying at this point, United operates an industry-leading managed care plan and a number of services business within its Optum unit. With us from the company, we have Wayne DeVeydt, CFO, Krista Nelson, CEO of Optum Health, and Ben Eklo, who's the CFO of Optum, and that was Julie from investor relations that we heard to kick us off. Thank you guys very much for being here. Of course, want to offer you a chance to make any introductory comments, but can also just go right into Q&A if you prefer.
I'll make some very brief comments. We continue our turnaround. I think everybody's been watching us over the last year as a team. Continue to be optimistic about 2026, but probably really more into the velocity that we are seeing going into 2027, and into 2028 as we start preparing for the multi-year outlook. Nothing has changed from our 2Q earnings call. I would say trajectory of things continue to be positive, with Medicare performing better than expected. Medicaid seems to be performing very much in line, and rates seem appropriate that we are receiving, and a little bit of pressure on the commercials we talked about from the IDR process. Optum Health continues to have an incredible turnaround. A lot of wood to still chop, but optimistic about the trajectory that we're on.
Okay, fantastic. Yeah, to kind of continue on that point, it's been nearly two months now since you did report second quarter results. Cost trend is a very front and center issue with everything the industry's gone through over the past couple of years. Can you give us an update on, as you saw some claims development on Q2, how that might've looked and any initial visibility that you have in Q3 that you might be willing to share as well?
Yeah. What I would say though is the trends that we saw happening through Q1, we obviously wanted to see some more development in Q2 to see if those, in fact, were durable. While I won't comment on our Q3 results at this point, I will say that durability has not dissipated, and so we continue to see that similar momentum that we saw coming out of Q2 continue into the last two months.
Okay. Then you highlighted, obviously, Medicare Advantage as a key source of outperformance in the first half of the year, at least so far. As we think about the drivers of that outperformance, can you maybe speak a little bit to why you're outperforming your Medicare Advantage initial margin targets? As we think about how you approached that business and guidance for the second half of the year, whether you think there's opportunities for outperformance there if trend remains at the levels that it's been at in the first half.
Yeah. A couple of comments I would make on this. I think probably the most important one was how we repositioned the book coming into this year, and really that positioning in terms of how it impacts us into 2027, into 2028. We really needed to make some tough decisions around the durability of the products we had, coupled with what we thought were sustainable margins over time. As we'd said when we started this year, we thought we would be in the 2%-4% range, but in the upper half of that range is where we thought we could land the plane this year. I would say that what we saw through the first half of the year supported that conclusion.
What we continue to see in the second half, really at this point now is really anchoring on where we fall out on that upper half at this point. But I would say all trends are pointing in the right direction, which also then gives us a lot more opportunity as we think about 2027 and products, and we've rolled those out. We know what we're going to be going in open enrollment with, but as we think about commission strategies, unique investments we can make in Q4 around Stars for our future years, I would say we're positioned well to be able to make those investments.
Yeah, and it's a natural pivot to talking a little bit more about 2027. I guess it'd be really helpful to understand how you approached bids for 2027. I guess, if any way you could contrast that to the way that you approached the bid process for 2026, and then I guess if you started to get some color on competitor position, and maybe it's a little bit too early on broker strategy. Have you started to form an expectation on what enrollment growth may or may not look like for next year?
Yeah. So maybe first on the bids, and I'll ask Krista and Ben to comment a bit as well since they helped support the bid process for us on our broader Medicare book, but also in many ways support the bid of others. As you think about as we approach this upcoming year, we continue to be very respectful of trend. I think it's one of those items, though, that you just cannot ignore the surprises we saw back in 2025. That being said, as many folks know, we had an additional point of pricing for what at the time were a lot of unknowns, right? At the time, there were tariffs that were pushed through. Obviously, those subsequently got overturned. There was a lot of uncertainty around AI and how that may impact the businesses, and the ability for us to adapt quickly to that.
But a lot of that has ultimately stabilized. The way I would say it is we think we're going to be very competitive in terms of our pricing for next year. We think our benefits will be competitive. A lot of the medicine that we took in benefit redesign was coming into the 2026 year, and we saw that in our CAHPS scores. When you remove benefits and change benefits, it will impact your CAHPS scores. But ultimately, we think it was the right decision. We still have a few markets where we're rightsizing some of the products, but I think we'll be well positioned for 2027. I don't know, Ben or Krista, anything you'd want to add from the Optum side?
I would just say from an Optum Health perspective, we've talked a little bit about this in the past, where we entered the year really w orking with all of our payers on a strategic plan to ensure that we're well-positioned for 2027, whether that's benefit design, benefit construct, a PPO, HMO, which markets, what part of our network are we taking risk on, et cetera. I would say those conversations have been extremely productive, super helpful.
Yeah.
The payers that we're working with are deeply committed to value-based care and are making the adjustments in partnership with us to make sure that we're well-positioned for 2027.
Okay. That's great. To come back to Star ratings, it's obviously been a more volatile input for the industry over recent years, and obviously there's been a lot of litigation that's added to the complexity. I guess, how is the company thinking about managing this key driver? I guess, how do you think about the range of potential outcomes, and how that plays into the achievement of the company's financial targets?
As you think about Stars, and it's a constant moving target in many ways, we approach it with really three lenses. The first lens is purely operationally, which is what are we doing that's completely in our care and custody operationally? As you think about coming into this year, we knew what our Stars were for 2026. We knew what we would have to do to improve on those operational items to be able to hold serve going into 2028. Those items we were very happy with. We improved on all four of our pharmacy metrics. We improved on 10 of our 12 HEDIS metrics. The other two held serve. But we went backwards on CAHPS, and we knew that we would do that because of some of the benefit changes we made.
But that's bucket one, which is it's in your care and custody, you aggressively manage your operations, you drive towards the high Star ratings. Bucket two, though, is you don't really know what cut points are going to be. For that reason, you have to actually take a proactive approach towards your administrative cost structures, and really, your sales approach. We are spending a lot of energy today positioning ourselves for not just 2027, but 2028 and 2029 around G&A initiatives. The last bucket is really it's a legislative environment where the rules will change constantly, but it's also a legal environment where the interpretation of those rules will change constantly. That's an option that's out there, but it's not one that necessarily we are pursuing at this stage.
To us, we want to work with the administration, we want to develop rules that work for everyone. But I would say in general, that's how we tackle it, and we're pleased with our execution on the first bucket and the execution to date on the second bucket.
Great. Then I think just broadly, there's an acknowledgment that at some point, there will be changes needed to the Stars program. I guess as you're engaged in those discussions, how's the company philosophically thinking about what could make this a better and likely more stable program moving forward?
Probably the biggest thing I would add is the administration, I would say both sides of the aisle, very much recognize that value-based care is really the wave of the future, right? That is really what Stars was trying to accomplish, right? It was trying to accomplish, how do we actually measure improvement in an individual's health? How do we measure compliance with the proper protocols around that health? The question is, to me, it's not a question of if value-based care becomes a bigger component of how Stars are evaluated or a new measurement. It's just a question of when, I would say the dialogue would continue to enforce the value-based care model. Krista, anything you'd like to add?
Just to reinforce exactly what you just said. I think what we're hearing is folks in this administration are looking to see how we can expand value-based care to more people and make sure it's expanding outside of Medicare Advantage even getting into traditional Medicare.
Yeah.
Things like the Stars program give us a lot of good insight into how to drive improved outcomes, but it also gives us insight on maybe where there's more administrative waste or burden into the system. We're bringing some of those ideas to make sure that we're creating a sustainable program that allows seniors to have really comprehensive care, strong benefits, and stability in the marketplace. I think whether it's traditional Medicare or other programs informing Stars, there's a lot of insight going into the program and how to design it for the future.
Okay. That's great. Maybe then we'll switch to Medicaid. You came into the year expecting margins - 1.1% to - 1.7%. Obviously, it sounds like you're tracking to that. Maybe we could first say, is there any bias within the range after you've seen the first half of the year and the early part of Q3? Then, secondarily, as we think about the components that make up that margin, how has the rate side of the equation developed versus your initial expectations, and has there been any adjustment to the cost side of your expectations on the other end?
Yeah, so maybe to unpack that a bit, when you think about Medicaid, there was really two primary concerns. The majority of it, though, was around the rates we were provided, right? So it really was a funding issue around Medicaid, less than it was a trend issue. There was a trend item that we saw specifically around behavioral health as well that really spiked back in 2025, and the question was, what are some of the things we can do to either manage the affordability or work with states on modifying their benefit programs that they had established? So relative to those two components, I would say we were really looking for rate increases in the 6%-7%, kind of on a blended basis across the book. Those have materialized very much as we would have expected.
Where there have been off-cycle increases, those have materialized as expected as well. Of course, it's much easier to have that discussion when you can show the states the underfunding that's currently occurring and the impact on their own programs. All in all, I would say that was a trough year on the rates, at least for this moment, and it appears that we're getting the right dialogue going into 2027. As you think about trend really wasn't spiking, but the question was what we saw in behavior, would that continue, and then more importantly, would that create a bigger halo effect on trend. We have not seen the halo effect on trend, and if anything, we've actually been able to mitigate some of the trend on the behavioral health. So, I would say both items are performing at expectations.
That's super relevant because if you think about our range that we provided of losing 1%-1.7%, that assumed a range of outcomes on a continuum of both of those. The fact that both of those are at expectations really pushes us to the low end of that range, which is why, again, we feel this will be a trough year on Medicaid margins, then moving back to breakeven or profitability going into next year.
Just because we're dealing with negative percentages here, tracking closer to the 1.1 or tracking closer to the 1.7?
1.1.
Okay.
The 1.0.
Got it. Okay. As you think about 2027, obviously you've been confident a number of times that this does represent a trough year for margins. Because you think about the positives going into next year for Medicaid, which would be rate catch-up and the things that you're working on in terms of cost of care initiatives, but also the negatives, things like potential incremental acuity pressure and potential for trend to be continued to be under-forecasted. I guess, how are you thinking about the net of those things to get to that level of confidence on the trough margin?
There's a combination of things. I think clearly, the OB3 work requirements and how those will impact states, there's a lot of uncertainty, which lends itself to a very fair question, which is why do you get some degree of confidence? That being said, we have been able to work with states not just on the rate increases needed, but really spend a lot more time on the education about how the risk pools are being impacted. States have been very open to understanding those risk pool impacts, and have been very open to a lot of benefit design changes. The more that we can work with them on even specific design changes, we know where the pressure points are when it comes to trend. There's clearly utilization, but there's also benefit design that can impact those pressure points.
We've had a lot of good dialogue, I would say good contractual understanding around what needs to happen, and a lot of those benefit changes are happening. We're going into the new year knowing that the states have agreed to some of these changes. Then couple that with, in many cases, where we didn't get the full rate relief that we needed within a state, but there's an understanding that if the trends were to persist, that that rate relief would then be trued up as we got into the new year. I do think that that's an important item, and our state partners are generally all very good partners. They do want to get to the right answer. They understand the importance of sustainability of the programs. The last thing they want is volatility of individuals pulling in and out of markets. Unfortunately, it is something that we have to do occasionally, as do our peers.
Okay. Then, I know obviously costs are a big focus across the entire company, but as you think about the components of generating a better Medicaid margin in 2027, I guess how do you think about what you need to happen on the MLR line versus what you can drive purely through G&A?
You always plan for the worst, then you try to execute to a better outcome. We do believe we should be able to positively impact the MLR in and of itself next year, and we've seen some of our own activities this year are having positive momentum on that. That being said, you should assume that the state budget pressures are going to persist, and you should prepare by taking out the necessary G&A costs to support the programs that are there. We have a multi-year program. It started this year. We're not talking about hundreds of millions. We're talking about billions that we plan to take out of the system. We're in a very unique world where AI becomes an incredibly positive catalyst.
To remove a lot of administrative inefficiencies, and really provide for those initiatives to either, one, serve as a safeguard against margins, or two, provide more flexibility in how we drive top-line growth over time. I don't know, Ben, you're leading the broad Optum initiatives around G&A. Anything you would want to share around the momentum and where we're at and how we're viewing it?
Yeah. As Wayne said, we're on a multi-year journey to really get after what the cost structure of this organization looks like and modernize it, technology enabled, AI enabled, future infrastructure of Optum. We're working through things like call and claim where we can automate and eliminate back office and positions that don't create the best experience for our consumers. We're looking at automating approvals, clinical documentation, leveraging technology in the places where there's just a lot of time and energy, manual energy that's being used. We're digging in there. We're using it in many of our Optum Health workflows in our clinics, ambient listening, freeing up time for recording and documentation for our physicians so that they have the opportunity to spend more times with patients doing the things that they enjoy.
Working through many different angles in our Optum Insight space, some of our legacy programs there, payment integrity, risk and quality, RCM, looking into ways that we can more tech enable those businesses to automate and find those efficiencies. Then really partnering across the organization in many of our corporate functions, so finance and accounting, marketing, communications, HR, finding different ways for many of those functions for us to use technology to largely automate a lot of the work that gets done today. Some of the momentum we have early on in some of our legal and HR and marketing functions, then kind of a fast follow of Wayne and I, in partnership with some of our other folks, are pushing to get finance to kind of a fully automated function by the end of next year.
We're working across the organization, in many instances, to try and find those opportunities where we can take costs out, make it more efficient, make it a better experience, and let us operate how we believe we should in the future.
Great. Thank you. A couple commercial questions, then maybe we'll switch over to Optum after that. Obviously, IDR was one of the issues that came up with the second quarter, and I think you provided some framing that it's added 100 basis points of cost, and I think that's off of a base of maybe 50 basis points in 2025. I think on one hand, obviously, this is a clear problem for the system that needs to get addressed at some point, but it doesn't seem obvious that it's truly incremental to what the cost trend was if it's 50 basis points in the base and 50 basis points incremental this year. Maybe just as you could step back a little bit and help us understand maybe a better framing for that and how to think about why IDR is holding up commercial margin improvement this year.
Yeah. So, two things to anchor on. First and foremost, we held serve on our margins year-over-year, but our goal was to actually expand our margins coming into this year, into 2026. And that did not happen. And again, the IDR was roughly a point on it. But it is also fair to say that the broader risk pools are changing, at least versus our expectations and our assumptions. And that was part of it. And as we continue to see more individuals move to self-insured, as we continue to see the residual impact of all the legislative changes, whether it be what OB3 did, or individuals coming off the Medicaid ranks and moving into the exchanges.
Yeah.
It is having a very difficult-to-predict effect on the broader commercial market. Again, that being said, we held serve on margins this year, but our expectations for growth did not come to light. We are performing better than expected, though, on the public exchanges. But as a reminder, we are refunding and rebating back this year as a commitment we made to Congress that we understand the affordability issues that are impacting the markets. And so we said for this year we would refund those. Had you included those, I think we would be more balanced around the impact on commercial.
Yeah.
But by pulling that out, look at it as more that true small group, large group market that we are seeing.
Okay.
That pressure, but not as much on the public exchange side.
Okay. Yeah, then maybe just kind of take us through how you're going to deal with this and the pace of recovery that might now be expected in the current environment, and I guess specifically, I guess how you're thinking about just the core cost trend, the IDR pressure incrementally, and potential for continued maybe degradation of the risk pool.
Yeah. The one benefit with commercial is you have chances to reprice the book throughout the year. We've already started many of those initiatives in Q2, Q3, and as we move into Q4. Then you'll still have a relatively decent renewal cycle in January. But that process of pricing for where we think trend is going to be, kind of where the puck's going to be, has already started. The one thing I would emphasize, though, is IDR, we're pricing for what we're seeing out there, but that's going to require a change from Congress around what's happening.
Yeah.
Separate from that is we are putting a lot of sunlight on the IDR process.
It's the greatest disinfectant, is sunlight. The idea is let's shine a lot more light on this. This is not a rampant industry item where every provider is doing this, right? This is a handful of individual companies, roughly five, that make up 60% of all the IDR, right? It is a mechanism that they've figured out an opportunity to take advantage of a legislative loophole that was not created for the purposes it's being utilized. We're sharing that data with Congress, and we want Congress to understand what these companies are doing and why we think there should be a legislative solution. But in the interim, until that happens, we have to price for it. That, unfortunately, puts more pressure on affordability for the consumer.
You mentioned that obviously you're not recording the exchange profitability this year, but it's running better than expected. Maybe characterize what you've seen so far in the exchanges relative to the initial expectations that you had. Then maybe speak for a minute just about how you're approaching next year in terms of your pricing strategy and maybe expectation around what the book size could potentially look like.
Yeah. I would say the membership was much more durable than I think we would have anticipated with the initial increases that were put forward on the public exchanges. From that perspective, we found not only a greater degree of stickiness within our membership base, but the underlying medical trends were very much aligned with our pricing, meaning that we were able to expand profit margins. Remember, though, this is a low single-digit margin business, right? We're not talking about one moving to five. You're talking about one moving a point, a point and a half. But I do think this is a particular business that over time is going to have to trend to that level of profitability, right? This is a government-supported program. As you think about Medicaid being a 2% margin business over time, you think about Medicare being 2%-4% margin business.
Similarly, I think you think of public exchanges this way. I would say both the stickiness, durability, but also the underlying trends seem to perform well, especially with all the unknowns that were happening with those that were being dis-enrolled.
Okay, great. Maybe this is a good time then to kind of switch over to the Optum discussion. I guess first, just kind of address this off the top. There was a news article last night discussing the sale of some assets, value-based care assets in Florida to private equity. I think this is something the company's alluded to previously. Could you just help us think about strategic rationale, and what makes this the right decision, and what it means or doesn't mean for the rest of the portfolio?
Yeah, I'll let Krista comment. I'll start by just indicating that it's really old news. We've had this partnership since 2011. It's an opportunity for us to really accelerate investments in different markets. Maybe talk a little bit about what we're doing there.
Yeah. I would just point to two things. First, like Wayne mentioned, in addition to having a partner for a long time, we've also talked quite a bit about some of the restructuring in the fourth quarter that we intended to do this year, and that was one of those transactions. Second, on the strategic side, we're not exiting Florida. In fact, this is actually an opportunity to make the right investments and be well-positioned for growth with a partner where we still have ownership, and we still have incentive to ensure that we can position that market for growth in the future. I think strategically that this was planned.
Yeah.
Obviously, we're making a number of those same strategic investments in a handful of other markets. Florida was an opportunity where we had a partner, and it was a great way to ensure we're making the right investment.
Okay, great. Then obviously the Optum Health outperformance in the first half has been pretty notable. I guess, how much of this would you characterize as coming just directly transferable through improved MA underwriting and outperformance there, versus other actions that you've taken? I guess how do we think about the second half in terms of opportunities for outperformance and maybe also opportunities for reinvestment too?
Yeah. First, I would just say really pleased with the execution and the outcomes that we're seeing in the first half of the year. Second, really just the pacing of the work of the turnaround. Really pleased with the progress. The vast majority of our outperformance is truly driven by clinical management and operating execution. We talk a lot about clinical excellence and operating excellence inside this business. I've given some examples of programs that we've launched that we can directly tie back to the outperformance. Again, that's why we feel confident saying the vast majority is the actions that we've taken to improve, whether that's transitions of care, clinical management, care coordination, support for our patients. We're seeing it in inpatient, we're seeing it in lower readmissions, we're seeing it in lower SNF admissions, length of stay.
Yeah.
All of our clinical metrics are really performing better than we expected, so it's kind of a first bucket driving it. Second, on the operating side, two things really. Operating cost management has been a really big theme for Optum Health this year, and I would say driving significantly more cost savings in the business than we've done in the past. That's going to be a theme that continues in the second half of the year and also into next year and in years beyond. Truly just operating performance. Things like physician productivity, scheduling, how we're creating more access in the system.
Yeah.
We've talked about expanding patient-facing hours by over 12% or 200,000 hours in the first half of the year. Those operating initiatives are driving better performance in the business, and again, will continue. All of those efforts are going to be a significant contributor to second half of the year, but also going to contribute to margin expansion inside 2027, and again inside 2028 for this business. So again, pleased with the performance, pacing ahead of schedule, and we're going to continue to focus on those elements because those also will help us drive investment in the business in the second half of the year.
Okay. As we think about the key levers that we need to believe in terms for you to drive up margins to targeted levels, sounds like hopefully by 2028, still the right way to think about it. I guess, what are the key levers there? Another question would be where do some of the recontracting efforts with external payers stand? Any kind of broad thoughts about when this part of the business might be able to return to more of the top line growth we've seen historically?
Yeah. First I'll just start out with some of the payer work. We spent the first half of the year, like I mentioned, working with all of our payers to make sure we're positioned, managing the loss contracts that we've talked about. I would say really pleased with the progress there, where the vast majority of all of our addressable contracts for 2027 have been addressed and/or mitigated. So feeling really good about now we're heading into the planning cycle, right? Getting ready for open enrollment and kind of getting ready for 2027. You asked about some of the levers.
Yeah.
We still had some work to do around some of our benefit construct, around some of our rates, around even just some of the contract dynamics, what we're taking risk for, what we're not. I would say that's been addressed in some of that contracting, but that is going to be a contributing lever to 2027 as you think about maybe some additional PPO reductions.
As an example, that will help improve performance for 2027. Another lever for 2027, in addition to what I mentioned around clinical and operating excellence, is just how we take our performance standards that we drive inside our employed practices out to our network. Optum Health was really on a growth trajectory the past few years, and I would say there was an opportunity around just network performance management. What are the tools we're bringing to our network? How are we performance managing? How are we making sure quality, we're managing cost, but we're managing affordability inside our network, and those are things that are going to expand inside 2027 to drive continued performance improvement.
Yeah.
As I think about 2027 and 2028, it's that core performance. There's new strategic initiatives that we'll be launching to ensure that we're driving affordability in the system, that we're improving quality, that we're in a position to expand margin by points inside 2027. Then that momentum continues inside 2028. Top line growth is probably not going to be the focus next year. Really, we're talking about earnings growth, kind of pacing appropriately towards our 6%- 8% margin target, but 2027 is also positioning us really well for growth inside 2028.
Okay, great. Last year as part of the kind of the broader update on the subcomponents of Optum Health, the company noted that the fee-for-service primary care and multi-specialty practices were losing, I think hundreds of millions of dollars. I guess first, has there been much change in kind of the operations and performance there, and what is assumed in those businesses as part of the financial targets going forward?
Yeah. Yeah. So fee-for-service was an opportunity for us. I think we were very focused on appropriately performing in value-based care, and I would say, maybe took some of the focus away from fee-for-service. But like I've mentioned before, fee-for-service is actually a core contributor to our value-based care agenda, our integrated value-based care system. All of our fee-for-service businesses are a lower total cost of care setting. They still focus on quality. You still get the benefit of a value-based care model, even when the payment model is fee-for-service. But we did have to do some things to really make sure that we were driving fee-for-service performance improvement, whether that's physician compensation, some of the scheduling enhancements I talked about, making sure we're improving access for our patients, whether it's some of our net collections and RCM improvement, coding accuracy, things like that.
I would say we're making really good progress on that this year, cost management being another lever as well, but still more work to do as I think about our fee-for-service turnaround, kind of pacing along the same lines as the value-based care turnaround. Maybe getting there a little bit faster in fee-for-service just because it's a little bit easier to pull some of those levers around basic blocking and tackling. But still more work and more opportunity as I think about heading into next year. In terms of just expectation setting, I would say all of our fee-for-service businesses are performing in line with our expectations, and in fact, maybe I would say slightly favorable in some cases where we're seeing really good year-over-year growth, really good mix and acuity inside those practices.
Okay, great. Then maybe to ask on Optum Insight, maybe one for Ben. I guess, as you think about reformatting, I guess maybe some of the products to be truly relevant in the AI era that we're in, I guess what are the key milestones there? I guess as you think about the financial profile of this business over time, it seems like ability to impact cost structure might be among the highest of any of the businesses with inside the company. I guess, how do you think about how maybe the margin profile of this business could evolve over the next several years?
Yeah. So maybe on the second part of your question first. Today we're at a kind of 18%-22% margin range in Optum Insight. The business is performing in line with our expectations this year. We expect that we'll finish the year closer to the top end of that range in 2026. Importantly, inside of 2026, it continues to be an investment in innovation year for Optum Insight, and so as we're modernizing some of these solutions that Optum Insight has had a longstanding place in the market with for majority providers, majority of payers, at the same time, we're innovating on what the future of those products look like. So to your question on what are those key milestones, we are in the process of building, developing, and selling a lot of these new products.
And so the runway to get to those sales, at times can be long because there is just so much change in the marketplace right now and so many different products and opportunities. So we are working to get those core tenants to these new models and these new products that we sell. We have a handful of those, and we are seeing good progress in the marketplace. But in many of those instances, the sales cycle does take a little more time. But I think as you see us land some of these, then they rapidly get deployed in the marketplace.
I think those are the milestones you will see is you may have a product like Optum Real or Crimson or Optum AI, where you have heard of it, but those are the things that are gaining momentum right now, and I think you are going to start to hear a lot more about those as we pace into 2027 and in the future years. At the same time, we are innovating, and I am sure there will be products that we are in the process of developing right now. The good news is we have a very good partner in UnitedHealthcare that we are working closely with on a lot of these products, and in most cases, they are using them, deploying them before we even bring them to market. So we have an opportunity to test quickly and learn and fail if we need to get those to market quickly.
Okay, great. Maybe just the last question then on capital deployment. As the company is increasingly able to deploy capital again over the next couple of years, I guess what should we think about as the key priorities and maybe how to contrast that against the capital deployment profile of the company that we have all kind of seen over the past 15, 20 years?
Yeah, I think you will see a similar approach to our historical deployment of capital. I think you should anticipate our first goal was to get our debt-to-cap much closer to the 40% range. If you go back to last year, this time we were closer to 45%. We should be tapping on 40 by Q4 of this year. We have been aggressively paying down our debt, and growing our earnings, which has helped with the debt-to-cap. That being said, that now allows us the flexibility to get back into the market in a much more aggressive way. When we started this year, we had anticipated deploying about $2.5 billion of capital for buybacks. We have now said we will do at least $5 billion this year. And that is relevant because we are doing that while achieving our debt-to-cap goals. We did recently raise our dividend.
As you think about the next five years, in my mind, we are going to have a balanced return of capital approach again. We would expect to continue to raise our dividend. We would expect to deploy a buyback at a much more aggressive pace. And we would expect to be reengaged in the acquisition space as we have historically been. Albeit, a lot more focused on what we think are the big growth drivers over time. We think value-based care is a massive opportunity for us, and we think these Optum Insight innovations are a massive one, and that is where our capital will be pursued.
Okay. Well, fantastic. I think that is all we have time for. Thank you so much for being here.
Great. Thanks.
Thank you.