Optum Health’s home-based care acquisitions are designed to support an overarching goal of expanding value-based care and diversifying clinical capabilities.
The UnitedHealth Group (NYSE: UNH) subsidiary in June penned an agreement to acquire Amedisys in an all-cash transaction of $101 per share, or about $3.3 billion. This followed its $5.4 billion acquisition of LHC Group, which closed in February.
Company-wide, value-based care is a driving force behind UnitedHealth Group’s growth strategy, according to the company’s CEO, Andrew Witty. To further expand this model, the company will need to leverage scale and an expanded suite of services within its health care and insurance businesses.
“As we think about how to work to streamline that great [health care] system, it’s inescapable that you need to have scaled capabilities to tackle that job. The idea that we can make real progress in a kind of mom-and-pop approach — doing things at micro levels and just hoping that naturally all solves some great problem — I think is unrealistic and non-achievable,” Witty said at the company’s investment conference on Wednesday. “What we bring at United is an idea of bringing together many different capabilities.”
UnitedHealth Group is positioning Optum as a cornerstone of its growing home-based care infrastructure and expansion of value-based service delivery.
Through these efforts, the company plans to slash its health care spending by helping patients remain in the lower-cost home setting and prevent avoidable high-acuity admissions. Thus, they are further developing and scaling their medical, behavioral, home health and palliative care capabilities.
The Minnesota-based insurance colossus has deployed billions in capital to fortify Optum’s capabilities through a number of high-profile acquisitions, which also includes the health care tech firm Change Healthcare.
“All of that is bringing together a set of scaled capabilities, which allow us to make bigger impacts across large parts of the system,” Witty said. “We spend our capital relentlessly looking for new ways in which we can supplement and augment those capabilities, but we firmly believe that scale is an important element of this change.”
UnitedHealth Group has a head start when it comes to scale. The company currently employs more than 450,000 people across its business lines, with about 135,000 attributed to Optum, which cares for 103 million patients nationwide. The company is also the nation’s largest operator of Medicare Advantage plans.
UnitedHealth Group earned $92.4 billion in revenue during the third quarter of this year, up 14% from Q3 2022. Optum accounted for $56.7 billion of that total, a 22% year-over-year increase.
A crucial component of the company’s expanding capabilities is its investments in home-based care. In addition to expanding its home health, hospice and palliative care offerings, the company is leveraging care coordination and transitional care services to manage patients with chronic or serious illnesses as well as prevent hospitalizations and readmissions.
“We serve more than 4 million people in fully accountable arrangements today. By this time next year, we expect to grow to nearly 5 million,” Dr. Amar Desai, CEO of Optum Health said at the conference. “We’ll do this by deepening our capabilities and in communities and presence where we already have Optum capabilities while continuing to expand in new geographies and further integrating care for patients along every step of their journey, ensuring patients can receive care where and when they prefer.”