UnitedHealth Group Incorporated (UNH) Earnings Call Transcript & Summary

Okay. Sounds like we're ready to go. I'm going to let Zack do some forward-looking statements, and then we'll kick things off.

Thanks, Lance. Just real quick. I just want to take a moment to remind you that today's presentation will include forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. These risks and uncertainties can be found in the cautionary statements in our SEC filings and on our website. Thanks, Lance.

Great. Well, welcome, everybody. And I'm Lance Wilkes, health care services analyst for Bernstein. Really excited to have the United senior leadership team here. And so I'll let Andrew introduce everybody, but before that, let me just do a little housekeeping. If anybody wants to submit questions, we've got Pigeonhole that's open, so you can submit questions electronically. I'll try to get those answers or get those asked. And then we'll just be going through a fireside chat here. And so with that, Andrew, if you want to introduce yourself and the team and the company really quick, and we'll kick things off.

Great. Lance, thanks so much. It's great to be here. Thanks for the invitation. I haven't been to a fireside chat where you get to stand up, so it's a little different today.

We try to do a little thing -- a little extra for you guys. So this is that extra bit.

Thanks so much. So John Rex, Chief Financial Officer of UnitedHealth Group; and Dirk McMahon, President and Chief Operating Officer of UHG, are joining me today. Really a pleasure to be with you. Just to remind you, UnitedHealth Group really focused on 5 core areas of growth opportunity for the company. As you know, our long-term -- long held and long-term growth aspiration is 13% to 16% adjusted EPS. That continues to be our goal, driven by 5 areas of opportunity, we believe, inside the organization: value-based care development. We believe that's the best way to treat people. Best outcomes, best medical outcome, best experience at the most affordable cost. Innovative benefit design led by our UnitedHealthcare platform, continue to look for ways in which we can innovate benefits both across government-sponsored books of business and of course, the crucially important commercial insurance sector as well. How we leverage technology as a business. You saw last year the acquisition of Change Healthcare gave us a further extension of our network capabilities into the U.S. marketplace. That gives us continued emphasis around how we can develop greater technology support to other participants in the system, particularly hospital systems, but going forward, including areas like provider enablement as well. Fourth area, pharmacy, most common touch point across the U.S. health care system. Significant business for us, not just the PBM. In fact, the PBM now is less than half of the business within our pharmacy platform. Specialty pharmacy, high cognitive services pharmacy in areas like behavioral health and in areas like HIV disease. And last but not least, financial services as a growing growth platform for the company, an area which began through the ownership of Optum Bank has been extended through a series of acquisitions over the last few years, in terms of innovating our connectivity into the marketplace, also augmented by the Change acquisition, which has significantly increased the amount of flow, which runs through our financial service network. So those platforms or 5 growth areas are the ways in which we think about how to structure the company. And obviously, within the organization, we have UnitedHealthcare and Optum as 2 distinct businesses, adamantly multipayer orientated as far as Optum is concerned. So we develop -- within the organization, we oftentimes develop between UHC and Optum. UHC oftentimes get the year advantage, if you will, to be the guinea pig to try out the new idea. Hopefully, it works. If it does, Optum makes available to other payers. That's what drives very substantial external growth of the Optum platform in complementarity to the UHC platform. Three things we've been focused on over the last 2 years to really improve our performance: making sure that we're exploiting the core synergy between Optum and UnitedHealthcare as much as we possibly can appropriately, of course, given the firewall requirements that are needed there; second, making sure that we're stepping up our consumerization focus as an organization, leaning into the future of health care being much more influenced by consumers across all lines of business; and last but not least, re-innovating our technology core platforms. Those have been the 3 capability areas we focused on. And with that, Lance, maybe hand back to you for Q&A.

Yes. So let's start off with the long-term vision for United. And one of the things I've always recognized as a competitor of you guys for years and as an analyst is you typically have been superior at strategic vision, strategic capital management, getting into business as early and in knowing where to go. Really interested in what the long-term vision is for the company now? And what do you see as the biggest opportunities, 5, 10 years down the line for United?

No, that's a great question. And I'll certainly ask John to comment specifically from a capital allocation perspective. But a couple of things. So first off, we certainly see value-based care. This is a -- this has got many, many more years to run in it. And if you look at it, although it's a very important part of our business, it's something we spend a lot of time on, this year, last year, we've transferred 750,000 to 1 million people into fully capitated lives per year within Optum. That's an incredible shift but it's still a tiny fraction of the total potential. Even within the classic senior populations where this business has really had its origins, we then think through about how commercial risk capitation could be a future dimension of commercial insurance. You can see the scope there is enormous. So I'd say value-based care remains a very significant, almost nascent opportunity for us despite its size within the organization. Super important. Secondly, in home, how you move care to home really important. That's going to be a big play in the future. I think the COVID pandemic has created a stimulus there. People want to spend -- they want to be out of big institutions for as much of their life as they possibly can be. How we can manage folks at home, how we can help them get good care at home. That's going to be an important element of building up capabilities. You saw our recent close on LHC as a key step in terms of deployment of capital in that arena. I'd call that out for sure. And I think as you look at what I said at the beginning, financial services is going to be a big play for us. That's going to be -- if you went back 10 years, and you'd have heard people like John Rex probably in his very first UHG [ out in ] talking about the future of Optum Care being a very substantial business and now it is, I think we probably feel the same way about financial services. So as we think about a decade from now, financial services ought to be a very, very material scale business for us. And I would say -- I'd say that's probably the third one I would highlight. John, you could add from a deployment perspective.

Right. If you think about the $35 billion, $40 billion of capital we deployed, say, over the last 3 years, more than 90% of that went into Optum businesses. And you can -- it wouldn't be surprising kind of where they track along here, and a lot of those would you'd be very familiar with. But certainly care delivery, one of the big areas that we've focused on, and we'll continue to focus. I'd agree with Andy. So while, again, we've been at a 10, 15 years, still feels pretty early in terms of opportunity here. And our capacities to bring in these types of businesses and to get them into the performance modes that we want to continue to increase. So that will continue as a core part of that where we focus. So I would think those kind of capital allocation elements will continue very similar. Certainly, health technologies, those areas, increasing areas. The Change Healthcare acquisition was one of the more significant ones we've done in that arena in some time. Much opportunity in that zone also. But you would continue to see a significant bias to the services businesses where we're still very young in terms of where we're heading and where we think the opportunity would be. And so those elements will continue. The last piece of -- so the early days of Optum Care and those businesses were all about primary care multi-specialty practices. What you've been seeing over the last 5 years or so is expanding the modalities. Andy mentioned home -- here in the home, behavioral, different care modalities where we can better integrate with the practice space that we have now to provide a more seamless experience for patients. And really trying to get much more of the care decision-making, potential coordination for the patient feeling like a much better experience for them, physicians more able to have impact and bringing those elements in. Super early days in terms of building out these other modalities.

Yes. I appreciate that. In a lot of our writings on value-based care, we'll talk about different care models and the evolution of the industry, and we typically think of value-based care version 3.0 as being what you'd think of as value-based care like Oak Street or a number of things, and we frequently refer to where you guys are as version 4.0 in terms of hitting other modalities as far as home digital as far as other populations and multi-specialty as opposed to just PCP. So it seems like there's a tremendous opportunity. Interestingly, like virtually every year you're here, I could look back and say, "Wow, the last year, from a stock price performance, has been phenomenal. Let's talk about how we can extend that." This year has been a more challenging year. And so there's a number of areas from policy and just kind of maybe normalization post COVID that we'll talk through. But before we hit that, I did want to talk about kind of the point of you've got these tremendous growth businesses that, in my opinion, have multi-decade runways and shift to government and managed care, shift to value-based care for those value-based care businesses. But you've got a few things that are emerging, and just be interested to see from your perspective how you prioritize those and what you see as maybe that next big business. You referenced financial services, and maybe talk a little bit about that? Or is it a consumer business? And obviously, insights and the investments you've made over there in health system enablement. So the challenge is, obviously, you have a number of interesting opportunities. What do you see as the biggest and the most important for investors?

Dirk, why don't you kick off that?

Yes. Well, you mentioned OptumInsight, Lance. I think as you sit back and look at where we've been, we've had some good bulwark businesses, specifically technology-based BPOs, things like payment integrity, risk quality network services, things like revenue cycle management. And as with the acquisition of Change, what we're trying to do is ultimately set us up so that as we move forward, we can get into other spaces. Like, for example, Change brings us a lot of connectivity with providers. Our ability to minimize the friction between payers and providers is something which we want to do for the system. Also, when you think about something like provider enablement, being able to have other providers take risk, being able to provide the tools to be able to do that. OptumInsight in the marketplace and Change in the marketplace, a lot of great provider relationships bring some of the OptumHealth tools into play to be able to help that. I think -- you also think about how United can help the system most. A lot of it is related to information. Again, clinical decision support being able to provide information on clinical gap closures very efficiently and effectively are things which we're really looking at. Andrew also mentioned, as we sit back and look at our growth pillars, I'm really bullish on what's happening with what we think we can do long term with the PBM, right? The PBM in the long term, and all of our pharmacy services, for that matter, oncology, you look at rare disease therapies. You talk to any employer today, what are they worried about? They're worried about the cost of specialty medications, right? Our ability to not only just do effective purchasing to be able to procure drugs as effectively as possible but also implement clinical programs for folks to be able to make sure that they're on the right clinical pathways for things like cancer drugs is a really important part that I think is going to be able to grow in the future. Andrew also mentioned things like cognitive therapies for behavioral health, right? Our community pharmacies are really important from a patient standpoint and a consumer standpoint to be able to get the right drugs at the right place to be able to make sure they get healthier. So those are some things as we sort of look forward where we say, "Hey, this is where the puck might be going, and we're investing in sort of executing against that."

Right. Again, before we get into some of the core fundamentals, I'd be remiss, having at least poked into a couple other companies, if I didn't ask about AI. And the key thing here is, I think, for a lot of folks in health care services space, you could ask about AI and what that might do, you actually probably have businesses where that -- where, obviously, Optum Ventures and a number of things where you're invested in, but where they could house things having to do with digital health, care automation, AI enablement within kind of efficiency plays and whatnot. How do you look at AI and digitization as important drivers? And where do you see those kind of fitting within UNH?

Yes, I'll take that. So generative AI, large language models, we today are working on use cases, specifically in the operating areas as we sit here today. So let me give you a couple of examples, right? We have hundreds of people doing medical appeals. Think about a world where an appeal response can be written by the technology, by generative AI, right? I think about -- like a simple benefit question like, is an arthroscopic knee procedure covered, right? So someone can basically get a great response to that via chat, right? You don't need a call center person to do that. Our call center people, I see of the future, are going to be those who really are upskilled to be able to handle the hardest of questions. But I think central things like really effective appeal writing, really effective responses in chat to be able to let people get a lot of that -- a lot of what I'll call the easier answers of health care presented in a very cogent effective manner. I see operations as number one. Longer term, what I'd like to see is basically running the AI across all of our data to be able to say, okay, Lance has this particular conditions today. Here's the data we have on Lance. As we look forward, hey, he's going to end up with this particular disease. Intervene earlier to be able to do some proactive measures to preclude the onset of that disease, right? I think longer term, that's in the future. Short term, we're really focused on operating efficiency. And we've got some fairly decent use cases that we're developing. That's one of the things which I've been really challenging our operating people really hard to be able to come up with use cases like I described, to be able to, "Hey, we got a lot of technologists. We've made a lot of investments. Let's make sure we put the technology to work effectively."

That's great. So kind of pivoting into the operating businesses, maybe starting over on the UHC side. Medicare Advantage. Obviously, we had the final rate notices, and coupled with RADV, there's been a view that, "Okay, the rate environment is going to be a bit tighter, at least on a real basis, going forward." Interested in your view on what are the long-term prospects for MA? What are the important drivers, both from a overall sector perspective, and then how might you be positioned? Could we see UNH be a bigger share taker in what might be a more rate-sensitive market going forward?

Yes. No, it's a great question. And obviously, rate notice has been a high focus. And maybe just to take 10 seconds on RADV and RADV audits. We welcome all that. We have no issue with that. We're fine. We come in order anytime they want. So that piece, so just put to bed. The rate notice, we're having a phase in -- essentially the best way to think about rate notice, for those of you who are deep into this, is really essentially it's a price cut on the MA business spread over a 3-year period. So the question is how you respond to a price adjustment, right? So the core underlying dynamics don't change. The number of seniors doesn't change, the number of people are interested in these programs probably doesn't change very much, but the pricing does. So the response to that is obvious. You have to manage your costs and you have to think about what your offer is into the marketplace accordingly. Historically, the company has always performed well in tighter environments. And I think going into 2024, we feel pretty confident we have a good plan going into that we've obviously spent the last couple of months working super hard. The bids go in over the next week or so, so I'm not going to get into any detail on that, obviously. But we feel good about it. And I'd say that as the years have gone by, obviously, UHC itself has got a tremendous capability set here to understand what's important to members and potential members. But Optum has also grown a really strong understanding here as well. So as you know, obviously, a very large number of MA capitated lives are looked after by Optum clinics. Bringing together that kind of super local micro view of what's important to a member alongside the United national view, if I can put it that way, I think has been particularly informative this year as we think about how to be innovative in the way we put the proposition together. So you'll see us respond. We go into next year feeling very good. We have a great Stars position. We have a great fundamental position. We think we're going to put in a very competitive environment. I don't know whether next year at a sector level is going to be the biggest year because, obviously, lots of other companies have got different challenges and who knows what they're all going to do. So I don't know whether the overall growth of MA next year is going to be a best ever, but we'd expect it to be a very strong year, and we continue to believe we're going to do super well in there. Not just in UHC, but also in number of lives that we're then able to transfer to Optum, which is a super important element of the value-based care strategy that I highlighted right at the very start.

Great. One of the other questions that's coming up is it seems like we're going into a normalization in utilization kind of post COVID. So just interested in your observations as far as medical cost, utilization through the first quarter. Any insights into the second quarter? And also reserving position, if you want to talk a little bit about that, because I think that's been the thing that investors have been questioning is, is there anything to worry about, not just for you, it's kind of a sector question with these claims payable?

Yes. No, listen, I appreciate the question, Lance. So I'd say very -- I'd, first of all, just sort of anchor back to what we said on our Q1 call. Now we've got more data since Q1, but I'm going to -- but it doesn't really change, I think, what we said there. So what we're seeing overall is very little. Not much to see in inpatients, honestly. So if anything, kind of flat to maybe even a little down, maybe a few kind of sporadic areas, but nothing notable. What we do see, and we talked about back at the Q1 call, is we do see or have seen a strengthened outpatient trend. No question about that. Now within that, of course, there's a whole raft of different things going on, but I'd particularly call out things like hips and knees. And I'd say it's particularly in the more senior population, which is, of course, where hips and knees get done, right? So there's a kind of self-fulfilling prophecy within all of that. So I'd say that as we talked about it in Q1, I think we've continued to see that. Maybe a little amelioration in the last month or so, but maybe a little early also to say that, honestly. Bottom line from all of that, I think there's 3 kind of high-level views I might take from that. One is there's clearly a lapping phenomena of a very, very low Q1, maybe Q2 of last year because of Omicron and the final vestiges of that. So that's obviously a dynamic at play here. Number two, good news that people are getting treated, right? I mean there's no question. Number three, we're not seeing a kind of unusual spike in acuity of chronic disease. So we're not seeing late-stage cancers presenting and that kind of thing. What we are seeing is these more elective type of situations within the mix come through. As we sit today, we have decent visibility of the first couple of months of the year in terms of claims progression. We have much less visibility of April, May, so we have to see how it plays through during the year. I think as we said on Q1, though, given what we saw even then, and I think probably I would just simply have the same view I had then, what we said on Q1 is that we probably expect the balance of earnings this year to be tilted majority in -- just the majority in the second half versus the first half, really consistent with that kind of pattern. John, you might want to add anything to that.

Yes. So that was kind of the elements that we would be referring to in terms of how we think about progression over the course of the year. Outpatient is where we do see a trend in consumption. It is interesting, though, that we have not gotten into this where we would have expected to see people with chronic conditions presenting in a sicker state. So it's elective care that's being sought out and being done. And like Andy said, great to see it happening and coming into the system. Your question also in terms of reserves, I really -- there's no change in reserving methodology in terms of how it plays out through any particular quarter for ourselves or I doubt for any of the companies in this. And elements that we talked about in 1Q would continue to be the elements that we're driving up, anything from Part D seasonality to Workday content to the elements that would drive the calculations. As a company, you don't really manage to a DCP. I know it's a great external metric. We really manage to that, and it's an important external metric, but no changes on that. And just I think what Andrew said in terms of those elements that we see, that we see coming in pairs, we're looking into 2Q and the rest of the year.

Got you. Then one question, because I do get asked about DCP reserve levels. We don't typically track DCP. We track some other ways of looking at similar things. But one question I get asked a lot is wouldn't that be coming down over time, not over a quarter, but over a decade, as you think of faster claims processing, capitation, increased pharmacy spend and things like that? So interested in any sort of comments you might have on that.

So yes is a quick answer. You can also see business mix elements impacting that also. For example, faster claims payment cycles and government program businesses. Differences as you move to fully capitated models with providers in terms of how those claims flow through, too. So there are business model changes in addition to just broader, I think lack of a better word, automation elements that you referred to. And just, I think, in general, getting to levels that were more consistent with where companies were, where we were pre-COVID.

Okay. Shifting over to OptumHealth and OptumCare. Can you talk a little bit about your particular value-based care model, in particular, sort of the outcome? What are maybe some of the ways in which you improve outcomes, improve kind of costs and savings to the system? And then any sort of magnitude that you could give for folks as what are the real savings that your value-based care delivers to the system?

Yes. Maybe I'll start and Dirk might want to add a little bit. I mean, so I think we're increasingly convinced it works, right, as a model. And I think that -- why does it work? I mean, first of all, I give all credit to CMS in terms of much of this, because as you think about risk adjustment as a mechanism, what that does is it basically puts money and incentive in the system for physicians, clinics to understand their patients, but basically figure them out, what have they got, what do they need and really get -- really starting to understand them. What we do then is we essentially bring the other piece to that. We used say, okay, well, the physician now, by capitating, we're now aligning your long-term interests with the long-term care of that patient. So this is no longer a fee for service. I met you once. I'm never going to see you again. This is your doctor. Your patient. You're spending the time to understand each other. The system is providing resources to support what that patient needs, and you're going to be with them as they evolve through that journey. We then back that environment up with a ton of kind of data information. So where is the best place to send that patient for the need, right? Because not every physician is going to have access to that kind of understanding of where the network opportunities are, where the best site of care is, all of those sorts of things. So all of those pieces play together very significantly. As you think about it, the model incentivizes you to diagnose early and to prevent. So if you -- as a physician, if you want to have the best experience -- so remember, how does this model work? Physician is incentivized both by the outcome, by the economics and the experience of the patient, through all the different mechanisms that we and CMS essentially have put in place. To get that to happen, you are massively leaning forward into diagnose, prevent, get ahead of the situation, minimize days in hospital, those sorts of things. What we're seeing is significant improvement, not just in cost. If you compare it to traditional Medicare, you see very significant improvements. We published a paper, November, I think, in JAMA, which laid out all of the clinic. I recommend anybody who wants to go read it. There's a very well-written paper in a very authoritative peer review journal, which is really the first peer-reviewed publication of the clinical impact of value-based care written by Optum physicians based on Optum data, which shows in disease area after disease area significant improved outcomes and reduced risk of hospitalizations, emergency room visits, et cetera, et cetera, et cetera. And then, of course, it plays out in experience. So you think about Stars and CAHPS, which is a big deal in terms of differential competitive position. That plays out from a patient perspective as well. Patients like it. And I think we -- our view is we continue to refine it. You're very kind to say we're version 4.0. We probably have another 6 versions to go. I mean, honestly. And I think we are -- one of the things I love about OptumHealth is it is, of course, an aggregation of dozens of different clinical organizations, many of which have got really long legacies of expertise in certain things. I don't know that they would all claim to be the expert of everything, but when you put the portfolio of everything that we brought together, together, my goodness, we pretty much have an expert in everything, right? And so then the key for us is how do we get those areas of expertise? I think about somebody like Kelsey-Seybold, [ Dr. Tony Flynn ], who joined us last year, really deep in commercial capitation and the differences between commercial capitation and managed care and MA capitation. You look at some of our groups over in the West, and they're very focused on waste elimination within medical practice. There are different areas. Now bringing that together and then nationally sharing that knowledge, nationally raising the bar across, is a super opportunity for us. And we drive that through obviously the engagement of the physician community. OptumCare is very much a physician-led organization, and we also do it through the provision of data and decision support capabilities. And that's an area where I think you'll see more and more as we go forward. And Dirk might want to just briefly touch on things like Optum clinical manager.

Yes. So there's a couple of things. We -- John mentioned Optum at home platform that we've established and how we get a lot of those results that Andrew talked about that were in the JAMA study. Just think about 2 sort of metrics. One, emergency room visits. Obviously, the worst thing in the world, someone to have to run to the emergency room. One of the key things is our HouseCalls platform gets people really effectively into primary care. If someone's in primary care and managed it very quickly after a HouseCalls visit -- I think it's 75% of people who have a house call are into a primary care visit within 90 days. I think that's a pretty good stat. But the key thing is getting people into primary care to preclude emergency room business. Another good thing is you think about our post-acute capabilities. One of the key things is when someone gets out of the hospital, the last thing you want is a readmission, right? So it's really important with the decision-making around, can this particular person go home or do they need to go to a skilled nursing facility or something like that? So sort of on the ground, that type of sort of what I'll call consumer-friendly sort of at-home sort of management has really been a boon to value-based care, and more specifically in the care delivery organizations themselves. A lot of investments have been made in things like utilization management systems and things like patient portals and things like referral management systems, where you get people to the right places of care and you manage your care really effectively to the better outcomes at lower costs. So I would say this whole value-based care genre is really about kind of meeting that patient and provider where they are getting to the right place in a really effective manner.

Now translating that kind of financials and the OptumHealth segment and things like that, I'd be interested in how you look at and what you think are the bigger opportunities or the proportion of drivers when you think of geographic expansion of OptumCare in the markets that you're not yet in, when you think of further penetration of other managed care organizations who maybe have Medicare members, MA members with you that aren't value-based care, or penetration of your non-MA, books of business so like commercial and ASO sorts of business, and then obviously, cost savings and margin opportunities from presenting the lower cost outcomes that you can achieve. So how do you look at that? And obviously, you're trying to hit all those things, but with where we are over the next 3 years, what do you think are the bigger things that would be driving OptumHealth sorts of results?

I guess I'd lead with that. So OptumHealth is still quite small in terms of what we think it should be. So they're fractional in terms of where the -- in terms of the people that are being served at this point when you consider just the number of value-based patients that we're serving, 4 million in the scheme of the country. So super small. So continuation of expansion of value-based arrangements with everyone. Optum is stridently multipayer today, will continue to be stridently multiplayer. That's one of the most important things this company can do in terms of having -- providing this access to as many patients, as many organizations as we can. So very super early innings in terms of just the footprint that OptumCare should have in terms of just delivery capacities. I think I wouldn't -- I think the important thing, and I heard you reference this earlier, Lance, the expansion of care modalities. So we're, at this point, more heavily into primary care, multipayer clinic-based businesses, but the expansion beyond that into these other modalities where we are nascent. Consider some of those more like OptumCare 10 or 15 years ago in terms of the core business in terms of where we are. And in some instances, the need's actually even higher and where we could go in providing an integrated experience for patients, where they're certainly facing a very fragmented view right now. So just behavioral, behavioral is an accelerating problem in the country for people in terms of access. And how do you create that access? How do you make it a more integrated experience? There's certainly a very disparate experience between your medical physician and your behavioral clinician. And how do you make that a more integrated experience? Elements that we need to be very focused on. So I think back to the way you pitched up the question, it's a little bit of all of it. But we don't feel ourselves that we're very far along in the journey itself yet in terms of where we sit with the number of patients that we're serving in these models versus the 330 million people in the country.

Yes. 1%.

Just one thing to add on what John said. I think it's really important to manage the consumer seams within health care. John mentioned integrated a few times when he was talking. I think about this in the context of between behavioral and between medical, right? Between, for example, home infusion and a primary care clinic, right? Minimizing those consumer seams is something which as health care sort of progresses is something that everybody needs to be thinking about and that's something that's on our mind.

Next question online, I'm looking over here at our votes that are coming in for -- and so please keep submitting your questions. The top vote getter is this, which is, "Could you expand on the opportunity in financial services? And maybe how -- what is the context of that business? And what do you -- what's the vision for that business?"

Yes. No, it's a great question, and I'll kick off, and I'm sure John will add a little bit to this as well. So our financial services business, just to give you a little history, began as a bank. So Optum Bank, HSA account bank, essentially, aggregator of substantial amounts of deposits as a consequence of that. And then over the last several years, we've kind of added to that in terms of capabilities, which, first and foremost, lean into the consumer world. And so through some acquisitions more recently, we now have capabilities where a point-of-sale retail registers, we're able to essentially -- so if a member, for example, goes -- buys their shopping, they have 30 items in their basket. Let's imagine 5 of those items are health care-qualified benefit items. Maybe it's an over-the-counter med or it's maybe some dental product or something like that. Provided they use their United card, essentially, the system will instantaneously recognize those 5 items as benefits that we're paying for. The patient won't be charged for it and the receipt will tell them we paid for it. Now that is a cool piece of tech. And I gave you an example more around, let's say, the senior area, but you can imagine employers are very interested in that. So Dirk, do you want to -- maybe without naming names, do you want to share the example of one of the employers who are taking advantage of this as well?

Yes, there's a large transportation company that is very interested and is exactly down the road that Andrew described. Being able to buy the right things and have it be substantiated, is this the concept we use, right? Buy something for health care. It's really important that you have the ability within all of your -- within your capabilities to buy Tylenol and not buy some liquor, for example, right? So yes, there is a large transportation company really under the heading of wants to be able to do this really effectively for their employees.

You see that in commercial as well. So what does that mean? It means that the employer is able to make -- to build the links so that the employee sees it as the employer who's looking after them, right? So they're creating this reinforcement linkage. So those -- so our health -- our financial service platform, bank consumer connectivity and then through the core networks of Optum and now through Change has 2 million providers on network. So we process payments and claims across about 2 million provider points in the system. So the retail connectivity, I just talked about. Provider connectivity, I just talked about. And so you can imagine that there is a very substantial amount of friction within all of that world. There's a very substantial amount of excess cost within all of that world. And so one of the big agendas for our financial services is to modernize and to streamline that area. We're making great progress in that. You'll see that continue to play out. Third area, maybe a little more unusual, we're currently piloting providers, so physician groups, so this is typically small physician group, working capital loan structures. So again, because we have visibility of the claim flows going in and out of a practice, we obviously have visibility of forward income. That gives us an opportunity to be able to structure short-term loans, typically working capital bridges, for clinics. Maybe they want to extend, maybe they want to hire one more member of staff. They don't get paid until 2 months after that staff member starts. How do they do that? How do they find the money? Very hard, surprisingly hard, for some of these providers to get it from classic bank environments. We're in a very interesting position where our risk -- our understanding of the risk of that loan is very much better than the average person's understanding of that risk. And so you see us extending that kind of arena as well. So continued growth of the AUM at the bank, continued extension of this kind of modernization of a direct-to-consumer experience, which allows us to enhance a lot of our product set, extension of the provider network and simplification and then looking at further add-ons like loan capabilities for providers. Those are some of the examples. I think as we play through over the next few years, you'll see many more of those, and I think this will be an area you'll continue to -- you should expect us to deploy more capital in this space, and this is an area we see a lot of scope to add.

Yes. That makes a ton of sense. For Optum Financial Services, where does that sit? And how do you organize that? Obviously, one of the strengths, but one of the challenges for you is -- of United is you have so many different capabilities. So you've got revenue cycle management that maybe you could play into this. You have a lot of different things. So how do you organize this? And how do you achieve that?

So it reports -- so you see it, it's numbers report into OptumHealth as we stand today. But we operate -- we try and be as pragmatic as we can be. As you might imagine, there's a lot of linkage with OptumInsight on this and particularly post the Change acquisition. And so we try very hard to make sure that we've got very good pragmatic relationships there. Now obviously, there are -- in some areas, particularly as you deal with different types of external partners, making sure we're consistent with those obligations. But those are -- that's all entirely manageable and actually works pretty well. From our perspective, I'd say we spend -- of course, you look at businesses in different ways. So I'd say Optum Financial gets a fair amount of our attention. Not so much on the day-to-day activity of that business, but much more around the capital deployment. What might be the next move we make? Where do we want to prioritize? And so they get a fair amount of insight -- oversight from us as well.

Yes. But to your point, I mean, there's the -- well, it does report to health. There's a huge intersection with OptumInsight. And we do think, long term, as we sit back and we look at where financial service can be deployed, you hit on a really good example. I mean is there an ability to be able to, within our revenue cycle management offerings, to be able to do more in financial services at clearly a growth area.

So again, appreciate all the questions that are coming in. I'll kind of honor the number of votes that are coming in here. And so there's a follow-up question on AI, machine learning. And I think this one is looking at 2 aspects of it. One is scoping. Like how big of an opportunity could this be from an efficiencies, SG&A standpoint, long term? And then the other is, how could this impact things like product design, MA products, as mentioned, but it's probably broadly like as you bake this into...

I think -- listen, I think the answer to the first is it could be big. And as you think about rate notice and price pressure or as you think about med expense in any given time period, being able to be more and more active around our cost base becomes more and more valuable to us, right? It gives us more controllability around our future and our ability to continue to deliver superior returns. And so we're super, super engaged around accessing those sorts of opportunities. And we have a very substantial cost base, which is linked almost in lockstep to the number of people who engage with us. So if a million more members sign up for us, our cost base steps up proportionately. It's been like that for a long time. It needs to change, right? That relationship needs to change. And AI and tech, generally, is that feels like a window is opening where we can see really substantial opportunities where we can change that kind of relationship without compromising the sense of quality or experience for the member or the patient. That's -- well, nobody wants here is a super tech solution that feels worse than the old way, right? I mean that's never going to fly. So -- but it feels like we're beginning to see some of those opportunities, and you'll see that. And I think on product design, I do think that's a viable space. Anywhere where you've got -- we're in an interesting market, right, where we all talk about the health care market but the reality is it's 330 million people individually all feeling very different 365 days a year, right? It's -- we homogenized it in the way we talk about it, but the reality is people are very, very different, and they feel different all the time. That is a very, very fertile space for something like AI technology to be able to figure the insights through all of that, which maybe was not so available to us before. The area where I'm a bit more skeptical is around hardcore change of medical practice. I wouldn't sit here today and lead people to think that we're going to have bots basically treating you or overriding a doctor or anything like that. I just don't see that in the current horizons. I see a ton of efficiency, and I see a ton of clever insight, which allows us to get from the average to the individual in a way which probably wasn't accessible to us very well. I'm going to stop there and I'm not yet convinced that this replaces physicians. I don't think that's right. I don't think that's happening, and we're not there.

So last question I'll ask for you here because we're just about at the end. In addition to financial services and some of the financial services, you've been developing a huge focus on consumerism and a number of more consumer-oriented businesses, Optum Store being an example of that. Can you just talk about kind of your posture in kind of your consumer-oriented business?

Yes. I mean I'll kick off and Dirk will certainly add. He's been super involved in this. So part of this is just a cultural evolution of the company, right? So the company historically was very much a B2B type that would have characterized itself really as a B2B kind of company with the many members who were participating. We've really taken the view we want to become much more a consumer-led organization. So a big piece of this is making sure that we're rethinking everything we do in the organization from a consumer-first lens. And you're seeing that in our product design. You're seeing that in the way in which we prioritize experience, service, feedback from customers and all of those things. And there is enormous opportunity for us, I think, in terms -- there's clearly opportunity for us, in a way in which we can innovate our products. So the example I gave you of this point of sale, ability to be able to communicate with the customer at the moment when they're spending their money. That is a really important element of our consumerization piece. And I just don't think we would have done that 10 years ago. I think that's a real kind of example. Our partnership with Red Ventures Health, which brings into the organization Healthgrades, Healthline, most commonly accessed points for advice on the Internet for anybody in health care in America. Great example of the same. That's leading us to strengthen a whole portfolio of how we might -- how do we manage attrition of members? So we do -- we spend a lot of time attracting new people to join our programs, but of course, inevitably, some people leave every year. Well, how do we reduce that number? We reduce that number by understanding what their friction points are as consumers, fixing them, and making sure they have no reason to want to leave. That's a really interesting area where we're deploying a lot of focus from that partnership. They are also looking at how we can build a greater capability. So if you think about Store for me was like a version -- definitely version 1.0. Version 3.0, 4.0, 5.0 is going to look much more like an all-comers marketplace for care. So you want to know anything about health care, you want to go shopping for health care, come to optum.com. That has got to be the future for us in terms of how we might innovate on that consumer density. So you'll see that kind of activity very substantially continue to extend. And I think within UnitedHealthcare, you're seeing both in the Medicare books of businesses, Medicaid, of course, but also in the commercial books, a step forward in being much more consumer orientated in the way they think about designing products. even the way we communicate. If you just look at the way we're ripping paper out of our communications to members, simplifying what we're saying, really trying to make sure it feels like any other thing you do in your life rather than this, "Oh, God, I've got to engage with health care and it's so complicated." How do we really bear down on that? You're seeing it across all of those aspects.

Yes, a couple of things. Just to hit on it. To start off, Andrew made a point, United was a largely B2B company for years, and one of the things that we volitionally did was recruit. We're kind of fortunate to have a lot of companies in Minnesota that are B2C. So we were able to recruit a lot of leadership to be able to sort of drive the change. And then I would say, secondly, just from a structural standpoint within Optum and UnitedHealthcare, there really are -- Optum [indiscernible] UnitedHealthcare, what we call UnitedHealthcare 3.0, these organizations are really dedicated to the consumer. And I would point to things like for like, for example, within UnitedHealthcare. The find in price care capabilities digitally that we've developed are a step function better than we were a couple of years ago. If you look in within OptumRx and you look at the NPS results of our specialty digital and our home delivery performance, just a step function better than where they were. And so we've just invested in these digital and consumer capabilities, which we know are sort of the crucial journeys for consumers: finding price care, have -- get a prescription. These things really leverage consumer experiences, and we've invested in those. So get the people in, get the structure right, focus on the areas that are of highest impact. That's kind of what we've done.

Great. Well, I really appreciate you guys taking the time with this, and I hope you have a great rest of the day. Thanks, everybody, for joining us.