UnitedHealth Group ‘Expanding Scope’ of Home-Based Care

UnitedHealth Group’s (NYSE: UNH) sights are set on home-based care, as evidenced by its acquisitions and investments in value-based care.

The insurance company’s subsidiary Optum Health recently completed its acquisition of Lousianna-based home health and hospice provider LHC Group for $5.4 billion.

Acquiring LHC Group was a key step in UnitedHealth’s larger plan to delve deeper into home-based care, according to President and COO Dirk McMahon.


“Our recent combination with LHC Group expands in-home capabilities,” McMahon said in today’s earnings call. “LHC provides high quality, compassionate home health, hospice and post-acute care services, with over 12 million patient encounters each year. We will learn from and build upon LHC’s capabilities, expanding the scope and acuity of the care we can provide in a patient’s home.”

The deal further diversifies Optum Health’s health care services. The company operated 964 locations in 37 states and the District of Columbia. In addition to hospice and home health, LHC offered home- and community-based services.

More deals are likely in the company’s pipeline as the year unfolds, according to John Rex, executive vice president and CFO at United Health.


“We expect to continue to increase our integration and investment activities, which were a component in the first quarter results,” Rex said. “We expect they will accelerate into the second quarter.”

The company experienced “double digit” revenue growth across its business lines, Rex stated.

UnitedHealth Group saw 15% year-over-year revenue growth in Q1, reaching $91.9 billion. Optum Health contributed $54.1 billion. This was a rise from $43.3 billion during the prior year’s period.

Optum’s results reflect a “continued expansion of the care services offered to meet patients’ care needs” across multiple settings, including in the home, the company indicated in its earnings report.

Optum expects to make more than 2.5 million visits in patient homes in 2023 and expects to continue expanding its scope of clinical services offered in that setting, McMahon stated. The company also anticipates managing nearly 12 million care transitions this year, which is twice as many as three years ago, he added.

Accelerated expansion in value-based payment arrangements have also contributed to the subsidiary’s financial performance, according to the company. This has been another pillar of growth for Optum and its parent company. UnitedHealth Group seeks to capitalize on the cost savings associated with risk-based payment systems like Medicare Advantage, in which the insurance behemoth is one of the largest players.

The company’s home-based care investments are also a savings generator. UnitedHealth Group has seen a more than a 15% reduction in hospitalizations among beneficiaries aligned with value-based payment models, McMahon reported.

“We have an opportunity to more deeply and effectively serve people in their homes,” McMahon said. “Nearly all the patients we’ll add this year in fully accountable, value-based relationships will have access to support through our home-based platform. Consumers value and benefit from services delivered in the home and we’ve expanded our capabilities to serve that need.”

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