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Duals: A Major Medicaid Opportunity for UNH

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Community & State revenues

In the first nine months of 2018, UnitedHealth Group’s (UNH) UnitedHealthcare Community & State business reported revenues of $32.47 billion, which is a YoY (year-over-year) increase of 18.05%. In the third quarter, the business reported revenues of $11.05 billion, which is a YoY rise of 17.87%.

According to its third-quarter earnings conference call, this performance was attributable to increased demand for services from the dual-eligible patient population enrolled in the Medicaid program.

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Medicaid enrollments

At the end of the third quarter, UnitedHealth Group’s Medicaid enrollments reached 6.63 million, which was a drop of 80,000 members compared to the second quarter.

The company’s third-quarter earnings release noted that this decline in membership was mainly attributable to the divestiture of a plan in New Mexico, which had enrolled 85,000 members. However, Medicaid membership increased YoY by 4.0% at the end of the third quarter.

Global enrollments

In the first nine months of 2018, UnitedHealth Group’s (UNH) UnitedHealthcare Global business reported revenues of $7.34 billion, which is a YoY rise of 26.83%. In the third quarter, the business reported revenues of $2.36 billion, which is a YoY rise of 18.24%.

According to its third-quarter earnings call, UnitedHealth Group is expanding its presence in South America—especially in Brazil—by leveraging its data analytics and technological capabilities, primary-care focused healthcare provider model, and integrated care delivery approach. The company is also focusing on strengthening its position in other markets such as Colombia, Chile, and Peru.

Optum business revenues

In the first nine months of 2018, UnitedHealth Group’s Optum segment reported revenues of $73.72 billion, which is a YoY rise of 10.37%. The business also reported earnings from operations of $5.53 billion, which is a YoY rise of 23.02%. The Optum business reported operating margins of 7.5% in the first nine months of 2018, which is a YoY improvement of 80 basis points.

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