Unitedhealth 4Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Medicaid great, medicare good, commercial and international tough

“his past year, we experienced outstanding growth in Medicaid and better than expected performance across our Medicare portfolio, balanced off by challenges in the commercial and international markets as we entered the year.”

Optum hits some secular trends

“The secular trends toward more complex and expensive specialty medications play directly to Optum’s strength in synchronizing and integrating medical and pharmacy benefits, providing uniquely personalized service. Optum is advancing this approach with UnitedHealthcare commercial customers in 2015 and expects to see further market interest in its capabilities in 2016.”

Little erosion in small business market from exchanges

“’14 we were minor players in the exchange so we don’t have a lot of information. I will tell you that I think it’s well within that range that we have talked about over the last couple of years a few percent of that small group market eroding into the exchanges at least at this point. I think the growth in the exchanges both in ’14 and in ’15 are really driven by the uninsured and that expansion through the subsidy. So we have not seen a significant erosion of our small group business,”

Not seeing any increase in utilization

“with December behind us and the majority of January behind us as well, we’re not seeing any indication or evidence of an increase in utilization. So we feel very comfortable with our forward outlook, commercial cost trend for 2015 is 6% plus or minus 50 basis points.”

The stars are important, but not so much from a marketing point of view

“I’d like to make it clear that we believe stars matters and that we’re focused on improving our performance in stars and I think we have been very consistent on that theme. It’s not clear that, that has had really an impact with respect to how the product is marketed or acquired in markets, but we do believe that it is important — overtime obviously important from a financial point of view, important in terms of our relationship with CMS who basically established those performance guideline. “