United healthcare Group is huge organization and is a
Fortune 500 corporation. According to
latest statistics the organization serves 115 million customers globally. The
organization not only serves in United States but also in other countries as
well. The organization over the years has experienced growth, and the revenue
of the organization has increased drastically in the last few decades. Charter
med incorporated company was found in 1974 while to reorganize this company
United Health Care Corporation was formulated in 1977. United Health Care
initiated its first pharmacy benefit management in 1988, but in 1994 it was
sold for 2.3$ billion. United health group subsidiary known as Evercare
accumulate with life mark health plans in 2001. In the month of June in 2019
Davita Medical group is changed to Davita Inc for almost 4.3 $ billion. United Health
Care Corporation creates a healthy atmosphere with healthy environment without
any discrimination and racism because most of the system of Health Corporation
is disturbed due to the presence of racism and discrimination. According to the
latest statistics the organization has employed 300,000 employees. The
organization over the years has experienced growth, and the revenue of the
organization has increased drastically in the last few decades
Introduction of United healthcare Group is huge organization
and is a Fortune 500 corporation
Rehab Medical of United healthcare Group is huge
organization and is a Fortune 500 corporation
Rehab Medical is working in the targeted market with a focus
on patient’s spectrum of care. Medical staff provide quality service for
patients with insights on healthcare objectives of Rehab Medical. Rehab medical
has partnership and collaboration in the healthcare insurance sector. Consumers
are offered competitive and best quality products and services for best
customer experiences towards Rehab Medical. Our products include manual wheelchairs,
pediatric wheelchair, power wheelchairs, and Scooters. These products are
specially offered to children and patients with disabilities to ensure safe
indoor and outdoor movements. Rehab Medical has proud partners including Cork
Medical, Sunrise Medical, and Quantum Rehab.
Background of UnitedHealth Group
UnitedHealth Group is among the largest healthcare care
organizations in the world. UnitedHealth is an American organization whose
headquarter is situated in the city of Minnetonka, Minnesota. The organization was formed in the year 1977
by Richard T. Burke. The key products
& services of the organization include Uniprise, Specialized Health care,
and other health care services. According to the latest statistics the
organization has employed 300,000 employees. The organization over the years
has experienced growth, and the revenue of the organization has increased
drastically in the last few decades. Charter med incorporated company was found
in 1974 while to reorganize this company United Health Care Corporation was
formulated in 1977. United Health Care initiated its first pharmacy benefit
management in 1988, but in 1994 it was sold for 2.3$ billion. United health
group subsidiary known as Evercare accumulate with life mark health plans in
2001. In the month of June in 2019 Davita Medical group is changed to Davita
Inc for almost 4.3 $ billion. United Health Care Corporation creates a healthy
atmosphere with healthy environment without any discrimination and racism
because most of the system of Health Corporation is disturbed due to the
presence of racism and discrimination.
The organization has four divisions which are mentioned as follows:
UnitedHealth care Medicare & Retirement
UnitedHealth care Global
UnitedHealth care Individual & Employer
UnitedHealth care State & Community
United Healthcare Group is huge organization and is a
Fortune 500 corporation. According to
latest statistics the organization serves 115 million customers globally. The
organization not only serves in United States but also in other countries as
well. The organization over the years have experienced growth, and the revenue
of the organization has increased drastically in the last few decades. Over the
years the organization has acquired many organizations due to which the
organization operations have expanded up to lot of extents. Although the
company has experienced growth, but it also faces various risks and issues as
well which include competition issues, reputation issues and rapid change in
technology. The external environmental risk factors have huge impact on the
organization’s performance, efficiency, and profitability. The external
environment factors such as political factors, legal factors environmental
factors, economic factors, technological factors, and social factors influence
the organization to make various decisions.
Issues Which UnitedHealth Group is facing
Narrative on Organization of United healthcare Group is huge
organization and is a Fortune 500 corporation
UnitedHealth Group Strategy of United healthcare Group is
huge organization and is a Fortune 500 corporation
Core Business Activities
Financial Performance of United healthcare Group is huge
organization and is a Fortune 500 corporation
The financial performance of the UnitedHealth organization
is measured by using the accounting ratios. The financial statements are
analyzed critically to know the financial performance in the current &
previous years (SAUNDERS, 2011).
Profitability of United healthcare Group is huge organization
and is a Fortune 500 corporation
Key
Ratios -> Profitability
|
|
|
|
|
|
|
|
|
|
|
|
Margins
% of Sales
|
2009-12
|
2010-12
|
2011-12
|
2012-12
|
2013-12
|
2014-12
|
2015-12
|
2016-12
|
2017-12
|
2018-12
|
TTM
|
Revenue
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
COGS
|
91.57
|
75.85
|
75.8
|
75.27
|
75.67
|
74.82
|
76.78
|
76.87
|
77.02
|
76.67
|
77.11
|
Gross
Margin
|
8.43
|
24.15
|
24.2
|
24.73
|
24.33
|
25.18
|
23.22
|
23.13
|
22.98
|
23.33
|
22.89
|
SG&A
|
|
15.25
|
15.37
|
|
|
|
|
|
|
|
|
R&D
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
92.7
|
76.99
|
76.91
|
92.2
|
92.71
|
92.68
|
93.41
|
93.42
|
92.91
|
92.9
|
92.76
|
Operating
Margin
|
7.3
|
7.76
|
7.72
|
7.8
|
7.29
|
7.32
|
6.59
|
6.58
|
7.09
|
7.1
|
7.24
|
Net
Int Inc & Other
|
-0.63
|
0.14
|
0.15
|
0.04
|
0.03
|
0.12
|
-0.05
|
-0.13
|
-0.08
|
-0.01
|
0.07
|
EBT
Margin
|
6.67
|
7.89
|
7.86
|
7.84
|
7.32
|
7.45
|
6.54
|
6.45
|
7.01
|
7.09
|
7.31
|
|
|
|
|
|
|
|
|
|
|
|
|
Profitability
|
2009-12
|
2010-12
|
2011-12
|
2012-12
|
2013-12
|
2014-12
|
2015-12
|
2016-12
|
2017-12
|
2018-12
|
TTM
|
Tax
Rate %
|
34.19
|
37.23
|
35.39
|
35.91
|
36.37
|
41.81
|
42.64
|
40.38
|
22.82
|
22.34
|
21.78
|
Net
Margin %
|
4.39
|
4.95
|
5.08
|
5.03
|
4.62
|
4.33
|
3.72
|
3.81
|
5.28
|
5.33
|
5.55
|
Asset
Turnover (Average)
|
1.52
|
1.53
|
1.55
|
1.48
|
1.5
|
1.54
|
1.58
|
1.57
|
1.53
|
1.54
|
1.46
|
Return
on Assets %
|
6.66
|
7.59
|
7.85
|
7.43
|
6.91
|
6.68
|
5.88
|
5.99
|
8.06
|
8.23
|
8.07
|
Financial
Leverage (Average)
|
2.5
|
2.44
|
2.4
|
2.59
|
2.55
|
2.66
|
3.29
|
3.21
|
2.91
|
2.94
|
3.15
|
Return
on Equity %
|
17.22
|
18.75
|
19
|
18.58
|
17.76
|
17.4
|
17.54
|
19.46
|
24.54
|
24.1
|
25.62
|
Return
on Invested Capital %
|
12.23
|
13.35
|
13.39
|
13.14
|
12.53
|
12.18
|
10.86
|
11.16
|
15.23
|
15.59
|
15.8
|
Interest
Coverage
|
11.54
|
16.35
|
16.76
|
14.64
|
13.59
|
16.62
|
13.95
|
12.12
|
12.82
|
12.39
|
12.08
|
Source: (Morning Star, 2019).
The profitability ratios provide brief information regarding
how much income the organization is generating by utilizing its assets. The profitability
ratios of UnitedHealth Group are indicating that the organization is generating
profit, but there is significant need to improve the profitability of the
organization. The corporation should take steps to improve the profitability of
the organization. In the year 2014 the ROA of the organization was 6.68%, which
increased in the following years and became 8.23% in the year 2018. It can be
said the profitability of the organization is showing increasing trend (Brigham & Houston, 2012).
Liquidity of United healthcare Group is huge organization
and is a Fortune 500 corporation
Liquidity/Financial
Health
|
2009-12
|
2010-12
|
2011-12
|
2012-12
|
2013-12
|
2014-12
|
2015-12
|
2016-12
|
2017-12
|
2018-12
|
Latest
Qtr
|
Current
Ratio
|
0.82
|
0.78
|
0.85
|
0.78
|
0.73
|
0.77
|
0.74
|
0.69
|
0.73
|
0.73
|
0.67
|
Quick
Ratio
|
0.67
|
0.63
|
0.69
|
0.63
|
0.58
|
0.62
|
0.61
|
0.59
|
0.62
|
0.61
|
0.57
|
Financial
Leverage
|
2.5
|
2.44
|
2.4
|
2.59
|
2.55
|
2.66
|
3.29
|
3.21
|
2.91
|
2.94
|
3.15
|
Debt/Equity
|
0.38
|
0.43
|
0.46
|
0.45
|
0.46
|
0.49
|
0.75
|
0.67
|
0.6
|
0.67
|
0.65
|
Source: (Morning Star, 2019).
The liquidity ratios of the corporation indicate whether the
corporation has enough cash to pay its short-term loans or not. The UnitedHealth
group liquidity ratios are indicating that the corporation does not have enough
cash to pay its short-term loans. The low liquidity ratios should be a matter
of concern for the organization because the organization can face difficulty in
the payment of short-term loans with lower liquidity.
Efficiency Ratio of United healthcare Group is huge
organization and is a Fortune 500 corporation
Key
Ratios -> Efficiency Ratios
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency
|
2009-12
|
2010-12
|
2011-12
|
2012-12
|
2013-12
|
2014-12
|
2015-12
|
2016-12
|
2017-12
|
2018-12
|
TTM
|
Days
Sales Outstanding
|
8.13
|
7.83
|
7.85
|
8.31
|
8.63
|
10.28
|
12.57
|
14.55
|
16.16
|
17.01
|
16.07
|
Days
Inventory
|
|
|
|
|
|
|
|
|
|
|
|
Payables
Period
|
55.6
|
63.95
|
45.24
|
61.28
|
73.34
|
75.83
|
72.36
|
72.35
|
74.35
|
73.73
|
75.71
|
Cash
Conversion Cycle
|
|
|
|
|
|
|
|
|
|
|
|
Receivables
Turnover
|
44.88
|
46.6
|
46.47
|
43.95
|
42.26
|
35.51
|
29.03
|
25.08
|
22.59
|
21.46
|
22.71
|
Inventory
Turnover
|
|
|
|
|
|
|
|
|
|
|
|
Fixed
Assets Turnover
|
55.73
|
59.47
|
42.93
|
34.07
|
30.63
|
30.78
|
33.71
|
34.2
|
31
|
29.07
|
28.23
|
Asset
Turnover
|
1.52
|
1.53
|
1.55
|
1.48
|
1.5
|
1.54
|
1.58
|
1.57
|
1.53
|
1.54
|
1.46
|
Source: (Morning Star, 2019).
The efficiency ratios of the corporation show that the
organization is utilizing its assets efficiently for generating sales. However
there is still room for improvement. The organization can further improve its
efficiency for generating higher amount of sales. When the sales of the
organization are going tom increase, than profitability of the organization
will also increase as a result (SAUNDERS, 2011).
Financial Leverage of United healthcare Group is huge
organization and is a Fortune 500 corporation
Key
Ratios -> Financial Health
|
|
|
|
|
|
|
|
|
|
|
|
Balance
Sheet Items (in %)
|
2009-12
|
2010-12
|
2011-12
|
2012-12
|
2013-12
|
2014-12
|
2015-12
|
2016-12
|
2017-12
|
2018-12
|
Latest
Qtr
|
Cash
& Short-Term Investments
|
18.7
|
17.75
|
17.68
|
14.14
|
11.25
|
10.69
|
11.59
|
10.81
|
11.14
|
9.41
|
10.33
|
Accounts
Receivable
|
6.42
|
5.87
|
6.7
|
6.92
|
8.61
|
11.29
|
11.96
|
12.74
|
11.38
|
11.99
|
10.87
|
Inventory
|
|
|
|
|
|
|
|
|
|
|
|
Other
Current Assets
|
5.71
|
5.54
|
5.59
|
4.97
|
5.03
|
5.29
|
4.85
|
4.03
|
4.15
|
4.02
|
3.94
|
Total
Current Assets
|
30.82
|
29.17
|
29.98
|
26.03
|
24.89
|
27.27
|
28.41
|
27.59
|
26.67
|
25.42
|
25.14
|
Net
PP&E
|
1.6
|
3.49
|
3.7
|
4.87
|
4.9
|
5.11
|
4.36
|
4.8
|
5.04
|
5.56
|
5.19
|
Intangibles
|
41.16
|
40.68
|
39.43
|
44.47
|
43.29
|
42.38
|
47.44
|
45.7
|
45.34
|
44.83
|
43.06
|
Other
Long-Term Assets
|
26.42
|
26.66
|
26.89
|
24.63
|
26.92
|
25.24
|
19.79
|
21.91
|
22.95
|
24.2
|
26.6
|
Total
Assets
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
Accounts
Payable
|
26.5
|
24.91
|
24.53
|
22.24
|
23.24
|
24.64
|
23.61
|
24.21
|
24.12
|
24.46
|
23.13
|
Short-Term
Debt
|
3.67
|
3.93
|
1.45
|
3.35
|
2.4
|
1.62
|
5.95
|
5.85
|
2.09
|
1.32
|
4.74
|
Taxes
Payable
|
|
|
|
|
|
|
|
|
|
|
|
Accrued
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Other
Short-Term Liabilities
|
7.37
|
8.74
|
9.26
|
7.93
|
8.4
|
9.19
|
8.92
|
10.01
|
10.62
|
9.79
|
10.03
|
Total
Current Liabilities
|
37.54
|
37.58
|
35.24
|
33.52
|
34.05
|
35.45
|
38.48
|
40.07
|
36.83
|
35.57
|
37.9
|
Long-Term
Debt
|
15.26
|
17.48
|
19.3
|
17.36
|
18.19
|
18.53
|
22.84
|
20.97
|
21.05
|
23.12
|
20.96
|
Other
Long-Term Liabilities
|
7.23
|
3.99
|
3.79
|
10.57
|
8.5
|
8.45
|
8.34
|
7.81
|
7.25
|
6.76
|
8.84
|
Total
Liabilities
|
60.02
|
59.05
|
58.33
|
61.45
|
60.74
|
62.43
|
69.66
|
68.86
|
65.13
|
65.44
|
67.71
|
Total
Stockholders' Equity
|
39.98
|
40.95
|
41.67
|
38.55
|
39.26
|
37.57
|
30.34
|
31.14
|
34.87
|
34.56
|
32.29
|
Total
Liabilities & Equity
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
100
|
Source: (Morning Star, 2019)
The financial leverage of the organization indicates how
much debt the organization has taken for financing its assets. Over the years,
the debt of UnitedHealth Corporation has increased which should be a matter of
concern because higher amount of debt is not suitable for the company. A high
debt amount increases the cost of capital and paying the debt amount back
becomes difficult.
References of United healthcare Group is huge organization
and is a Fortune 500 corporation
Brigham,
E. F., & Houston, J. F. (2012). Fundamentals of Financial Management.
Cengage Learning, 8 серп.
Morning Star. (2019). UnitedHealth Group Inc. Retrieved from
http://financials.morningstar.com/ratios/r.html?t=UNH®ion=usa&culture=en-US
SAUNDERS. (2011). Financial Institutions management. Tata
McGraw-Hill Education.