Q1 2025 UnitedHealth Group Inc Earnings Call
Here's some important introductory information.
Call contains forward looking statements under U S Federal Securities laws.
These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations.
Ascription of some of the risks and uncertainties can be found in the reports that we file with the Securities and Exchange Commission, including the cautionary statements included in our current and periodic filings.
The call will also reference non-GAAP amounts a reconciliation of the non-GAAP to GAAP amounts is available on the financial and earnings reports section of the company's Investor Relations page at Www Dot Unitedhealth group Dot com.
Information presented on the call is contained in the earnings release, we issued this morning and in our form 8-K dated April 17, 2025, which may be accessed from the Investor Relations page of the company's website.
Speaker Change: I will now turn the conference over to the Chief Executive Officer of Unitedhealth Group Andrew witty.
Speaker Change: Good morning, everyone. Thank you for joining us today.
Speaker Change: Good Health group started 2025, and two seemingly disparate ways.
Speaker Change: <unk> continued strong growth across our businesses, our people are providing more health benefits and services.
Two more members and patients as the market responds to our distinct offerings. The other way however, with an overall performance that was frankly unusual and unacceptable.
Speaker Change: As you saw in our release, we are revising our adjusted earnings per share outlook for the year to $26 to $26 50.
Speaker Change: This morning, we will detail for you the factors driving our revised outlook and how we plan to address them.
Speaker Change: I will start with performance, which was impacted by two broad factors in our Medicare businesses care activity a member profiles.
Speaker Change: It is important to recognize unitedhealthcare and optum, our distinct businesses with different models markets and products in.
Speaker Change: In addition, opt ins Medicare business is multi payer and not limited to just unitedhealthcare members.
Speaker Change: Given these differences changes in care activity and member profile do not always follow the same patents and can result in different impacts to each business.
Speaker Change: The respective teams are urgently respond into our performance challenges.
Speaker Change: Starting with carrier activity and United Health Care is Medicare advantage business. We had planned for 2025 care activity to increase at a rate consistent with the utilization trend we saw in 2024.
Speaker Change: Instead, though first quarter 2025 indications suggest cat activity increased at twice that rate.
Speaker Change: Increases in physician and outpatient services, where most notable and inpatient to a lesser extent.
Speaker Change: This increase in carrier activity was limited to our MA business and was not a factor in our commercial all Medicaid businesses.
Speaker Change: Carrier activity trends in those areas where as expected.
Speaker Change: Turning to member profile.
Speaker Change: Anticipated changes in our Optum Medicare membership is impacting 2025 revenue.
Speaker Change: We added more new Medicare patients to Optum health, a portion of whom were covered by plans that were exited markets.
Speaker Change: They experienced a surprising lack of engagement last year, which led to 2025 reimbursement levels well below what we would expect and likely not reflective over their actual health status.
Speaker Change: Additionally, many of the current and new complex patients. We serve are more affected by the CMS risk model changes that we are in the process of implementing.
Speaker Change: To be sure. It is complicated, but we're not executing on the module transition as well as we should.
Speaker Change: We must and will work to better anticipate and address these factors.
Speaker Change: He is still early in 2025, we believe they are highly addressable as we look ahead to 2026.
Speaker Change: Let me now talk specifically about what we're doing.
Speaker Change: First we are ensuring the complex patients most impacted by the previous administrations Medicare funding cuts engaging clinical and value based programs.
Speaker Change: We're consistently engaging with members in their homes and post discharge settings engagement remains the key.
Speaker Change: Third we are appropriately assessing and updating the health status of new patients.
Speaker Change: Especially those at high risk levels.
Speaker Change: Fourth to more effectively transitioned to the new CMS risk model, we're investing significantly in improving physician clinical workflow to help ensure better care and timely insights on when and where care is most efficient and effective.
Speaker Change: Finally.
Speaker Change: Our Medicare advantage plan designs and pricing for 2026 will be fully informed by these trends.
Speaker Change: While we are decidedly unsatisfied with these results our growth and foundation for improvement remains solid.
Speaker Change: Unitedhealthcare is Medicare advantage business is on pace to serve an additional 800000 people this year.
Speaker Change: Optum health is on track to add 650000, net new patients to value based care arrangements.
Speaker Change: In Medicaid, we're growing and continue to see positive momentum in closing the gap between People's health status and state rates and we are very appreciative of our state customers for the ongoing productive discussions.
Speaker Change: Within Optum, so far this year ophthalmology Rx is off to a strong selling season characterized by new wins as well as high retention of long term customers.
Speaker Change: The growth of optimal Rex underscores the vital role that pbms play and helping to reduce the price of drugs with consumers.
Speaker Change: And the value that sophisticated purchasers of health care, the employers unions and governments see in our efforts to counter the high prices set by drug manufacturers.
Speaker Change: And to ensure that people have convenient access to high quality affordable drugs.
Speaker Change: That's more important than ever as drug manufacturers continue to increase what they charge Americans in some cases 10 times, what they charge people in Europe.
Speaker Change: The growth that Unitedhealthcare and Optum reflects the efforts of our 400000 colleagues who come to work every day.
Speaker Change: Thinking differently about what is possible advancing new products and ideas, while constantly refining existing programs working to make things better for the people we are privileged to serve.
Speaker Change: Our team continues to innovate to make accessing care easier for example, our newest tools has sparked a more than 40% increase in digital engagement among our senior members through the first quarter.
Speaker Change: We see evidence of this in sharply higher and earlier wellness visits to their primary care physicians with total visits in the first quarter running far above the year ago period.
Speaker Change: This will help members better manage their health and promote early detection of emerging issues.
Speaker Change: Further Medicare advantage also cost taxpayers less and delivers more to seniors than fee for service Medicare, especially in value based care arrangements.
Speaker Change: An essential approach in.
Speaker Change: In achieving both health outcomes and lower costs is ensuring people get the care, they need when and where they need it and.
Speaker Change: In a good place to understand those needs better is in our seniors home. Our house calls program does just that.
Speaker Change: How schools, which is only available in Medicare advantage provides a thorough in home clinical visit at no cost to seniors.
Speaker Change: Following cms's best practices for such care, our clinicians review, a patient's medical history and current medications conduct comprehensive physical exams provide lab tests and screenings and coordinate necessary follow on care.
<unk> clinicians close millions of care gaps last year, helping people stay out of the hospital and the emergency department and refer and those in need to appropriate social services to help them live healthier at home.
Speaker Change: This is Medicare advantage innovation and value in action, helping drive proactive preventive engagement with the health system, rather than more expensive reactive acute care.
Speaker Change: These benefits and innovations on their value to seniors and taxpayers will put at unnecessary risk by funding cuts in recent years to the Medicare advantage program.
Speaker Change: While we continue to navigate those funding cuts to seniors benefits. It is significant that the recently released 2026 rate notice begins to reflect the accelerating <unk> cost trends, we've experienced for some time.
Speaker Change: This will provide much needed relief to seniors and reflects policymakers understanding of the importance and the popularity of Medicare advantage.
Speaker Change: Our work to deliver a better experience for people and lower cost spans our enterprise as it always has.
Speaker Change: Just within the last few weeks, we've introduced several initiatives that will help people and their health care journeys.
Speaker Change: <unk> will remove prior authorizations on eight T drugs accounting for more than 10% of our pharmaceutical prior authorizations and.
Speaker Change: And <unk> has aligned payment models to pharmacies more closely to their costs for drugs.
Speaker Change: This helps pharmacies manage the ever increasing prices charged by drug manufacturers, enabling pharmacists to stock more medicines and ensure a more consistent pricing and access to medicine for consumers.
Speaker Change: 26 million consumer calls where more accurately directed to the right advocate by an AI agent improving the consumer experience and reducing wait times we.
Speaker Change: We expect AI will direct over half of our calls to the best resource during 2025.
Speaker Change: All of these efforts are making things simpler and easier for consumers and providers our goal we share with all healthcare stakeholders.
Speaker Change: Yet.
Speaker Change: We all have to contend with the stop in fact, the healthcare costs more in the U S. Then it should.
Speaker Change: Even beyond the widely recognized disparities in drug prices.
Speaker Change: Common procedures, such as heart bypass surgery spinal fusions on heart stents are four times as expensive in the U S. As they are in Germany, Australia, and the U K total hip replacements are twice as much it's.
Speaker Change: It's simply not sustainable.
Speaker Change: So we have made clear we are as committed as ever to continuing down the path of transparency and affordability and sure in the Americans get the health system. They deserve.
Speaker Change: With that I'll turn it over to John who will discuss first quarter performance and full year outlook in more detail John.
Thank you Andrew.
Speaker Change: I'll start by walking through several updates to our 25 outlook and then elaborate on the reasons for them.
Speaker Change: As Andrew said, we now expect adjusted earnings up 26% to $26 50 per share.
Speaker Change: It is an outlook that I am extremely disappointed to share with you.
Speaker Change: This reflects the profile of patients served at Optum health.
Speaker Change: It also reflects significantly increased care activity across the Unitedhealthcare Medicare advantage plans.
Speaker Change: Within that outlook, we expect about 50% to come in the first half of the year.
Speaker Change: We are affirming the consolidated revenue outlook of $450 billion to $455 billion, we shared with you in December.
Speaker Change: Within this we expect revenues for both Unitedhealthcare and Optum Rx to be better than our initial view offsetting a reduced outlook at Optum health.
Speaker Change: The full year medical care ratio is now expected to be 87, 5% plus or minus 50 basis points.
Speaker Change: Reflecting higher utilization across senior populations and the patient mix and revenue profile of Optum health.
Speaker Change: Within this range, we expect the first half of the year to be below the midpoint and the second half to be above.
Speaker Change: At Optum health, our revenue outlook is 106 to 107 billion and operating earnings of $6 to $6 4 billion based on the factors discussed and which I'll get into more deeply in a moment.
Speaker Change: Over half of the $10 billion revenue change is the result of transitioning some legacy risk based arrangements to fee based and is neutral to earnings.
Speaker Change: We expect about half of Optima health operating earnings to be in the first half.
Speaker Change: At Unitedhealthcare the operating earnings outlook is updated 2016 to $16 5 billion and reflects the higher cure activity we're seeing.
Speaker Change: Within United Healthcare pressure was largely contained within the senior business, where we saw a sharp increase in care activities that became apparent as we closed out the quarter.
Speaker Change: As noted this was most significant for both physician and outpatient care and to a lesser extent inpatient care.
Speaker Change: In years past. This is an insight we may not have picked up until the second quarter. So it is useful to have the information with ample time to incorporate into our 'twenty six planning.
Speaker Change: In the quarter, we experienced percentage increases in care activity about double last year's level.
Speaker Change: Unit prices behaved as expected.
Speaker Change: So let me start with the obvious fact that it is early in the year and we don't know everything that might be driving our experience or how long the increase in care activity might last.
Speaker Change: But care activity was broad based across our senior individual and group populations.
Speaker Change: One example, and group MA member retention was about 98% and as a result serves as well as a same member metric.
Speaker Change: Here, we observed significant increases in elective care activity in the first quarter.
Speaker Change: Of note in this population, we believe that behavior may have been impacted by the meaningfully higher member premiums, which were driven by the Medicare funding cuts.
Speaker Change: Another example across senior populations was the earlier and higher wellness visit activity, we saw which of course drives specialty in outpatient utilization.
Speaker Change: Some of this may be a seasonal shift in consumption patterns as wellness visits happen once a year.
Speaker Change: Turning to Optum health as it relates to the patient profile, we experienced a couple of key elements here.
Speaker Change: First growth in certain markets, where there were meaningful planned exits.
Speaker Change: These new patients had not been engaged by their prior plans for most of last year.
Speaker Change: And we're seeing revenues associated with the patient profiles meaningfully below expected and normal levels.
Speaker Change: This is very addressable.
Speaker Change: Second the ongoing execution to the new CMS risk model, while complicated given the multiyear phase and has not been to our operational standards.
Speaker Change: Transitioning to a new model and concurrently running two distinct divergence has been more operationally complex than anticipated.
Speaker Change: But no question, we need to execute better and we will.
Speaker Change: Across the enterprise, we continue to focus on operating costs to help mitigate external pressures, while ensuring our workforce aligns to the areas of greatest opportunities and customer needs.
Speaker Change: Looking ahead, we see a long runway for further technology advances that will translate to more and sustained operating efficiency, which in turn drives opportunity for further innovation and advancement in the company and across the industry.
Speaker Change: Before we get to Q&A I want to provide a few business highlights.
Speaker Change: At United Healthcare, we still expect to serve up to 800000 more people in Medicare advantage this year across our individual group and dual special needs offerings.
Speaker Change: This underscores our long standing commitment to stability and differentiated value.
Speaker Change: Our growth demonstrates uhc's deep relationship with our members.
Speaker Change: People served by our community and state business increased to $7 6 million.
Speaker Change: We continue to have growth momentum with recent service expansions in Kentucky, New York and Florida.
Speaker Change: We're also encouraged by the updated Medicaid rates, so far in 'twenty five that more closely align with underlying member acuity.
Speaker Change: Lending remains insufficient to meet the health needs of patients.
Speaker Change: Commercial self funded membership increased by approximately 700000 in the first quarter.
Speaker Change: <unk> of our continued strong product innovation.
Speaker Change: Commercial insured membership was impacted by the individual exchange products are.
Speaker Change: Our disciplined pricing approach remains consistent and as a result, we experienced some member attrition.
Speaker Change: Overall in our commercial book, we are encouraged by the early 'twenty six selling season indications, which are showing strong retention rates.
Speaker Change: Turning to Optum.
Speaker Change: At Optum health, we continue to expect to add 650000, new value based care patients this year.
Speaker Change: We are working to engage with these new members ever more rapidly by the end of 'twenty five we expect to have about $5 4 million value based care patients.
Speaker Change: At Optum insight, we have a pipeline of new products coming to market. This year with exceptional customer interest for example in the first quarter, we launched AI powered claims efficiency tools that increase productivity by over 20% for our revenue cycle management customers.
Speaker Change: Lastly, Optum Rx revenues grew 14% exceeding 35 billion for the quarter.
Speaker Change: Both customer retention and new customer wins contributed to script growth of 3%.
Speaker Change: Okay.
Speaker Change: As Andrew noted performance in the quarter was below the standards we expect.
Speaker Change: But with disciplined and urgent execution and attention to detail.
Speaker Change: We expect to return to form in the quarters ahead.
Speaker Change: With that I'll hand, it back to Andrew.
Andrew Witty: Thanks, John even with the growth of our.
Andrew Witty: I'm, sorry, even with the growth of people generated this quarter. This was far from the performance we expect of ourselves.
Andrew Witty: We're acutely aware, it's a privilege to be a part of an organization with the capabilities to make a meaningful contribution to modernizing and simplifying the health system and we.
Andrew Witty: We're committed to improving our performance in the rest of 2025 and into 'twenty six and in dose and doing so to delivering consistent positive results for you and returning to our long term earnings per share growth target of 13% to 16%.
Andrew Witty: With that we can now turn to your questions operator.
Andrew Witty: Thank you the floor is now open for questions. At this time, if you have a question or comment. Please press star one on your Touchtone phone.
Andrew Witty: You may remove yourself from the queue by pressing star too on your Touchtone phone, we ask that you limit yourself to one question. If you ask multiple questions will only be answering the first question. So we can respond to everyone in the queue. This morning.
Andrew Witty: Okay.
Speaker Change: We will take our first question from Justin Lake with Wolfe Research.
Justin Lake: Thanks, Good morning.
Speaker Change: My question's on Medicare advantage Clark, Greg you said that.
Speaker Change: You came into the year, assuming trend at similar levels to 2024 can you share with us precisely what that trend estimate was meaning where did you expect for this year.
Speaker Change: And what are you expecting now and can you tell us how much of that you saw in the first quarter for instance, how much did you Mr. MLR by your own estimate of MLR.
Speaker Change: And how much you're expecting that to.
Speaker Change: Accelerate or how different the back three quarters is versus what you saw in the first quarter.
Yeah.
Speaker Change: Yes.
Speaker Change: And by the way.
Speaker Change: Yeah, Justin Thanks, so much for the question I've got Tim Knowles to respond just in a second and detail to your question.
Speaker Change: Obviously, it's still very early in the year, but but we have we have clearly seen.
Speaker Change: A pickup in trend and a specific part.
Speaker Change: The UHC business became the senior business, Tim will talk a little more about that to you in a second.
Speaker Change: It's still early still.
Speaker Change: Even though first quarter is only policy complete but unusually we've seen this pick up and which is well it's obviously.
Speaker Change: Fluids and.
Speaker Change: Our position here. So let me ask Tim to give you a little bit more detail on that.
Tim Knowles: Good morning, Justin Thanks for the question yes.
Speaker Change: Attempt to break it all down for you here so.
As mentioned in the opening remarks in 2025, we anticipated.
Speaker Change: <unk> levels consistent with what we observed in 2024, which felt appropriate as we stepped into the year.
Speaker Change: And what we were assuming and if you think about this as units consumed.
Speaker Change: We're assuming that in 2025, we'd see a similar increase by that metric that we observe in 2024 and if you break that down on the Medicare book, you can think that in total in terms of total trend drivers about one third of that is related to increase in carrier activity.
Speaker Change: Or units consumed on them, what we are seeing and again, that's focused on physician and outpatient.
Speaker Change: But driving an overall two times increase in that level of units consumed in Q1 of 2025 and again that metric is about one third of the total trend drivers in the Medicare book.
Speaker Change: We are seeing that inside of the first quarter of this year, but we are making the assumption right now that that trend will persist throughout 2025, and then also making the same assumption that it will persist into 2026 and that will shape. Our overall on pricing assumptions now some of the.
Speaker Change: The drivers that John mentioned on behind what we're seeing you might presume that some of those would result in a change in our seasonal consumption patterns, but at this distance we feel like we need to make the assumption that that activity will persist throughout the year and into 2026.
Speaker Change: Alright. Thanks, so much next question please.
Speaker Change: Sure.
Speaker Change: And we'll take our next question from Josh Raskin with Nephron research.
Josh Raskin: Hi, Thanks. Good morning can you help us connect the higher incidence of primary care visits and the Optum health pressure I assume you don't have that primary care issue on Optum health, which should also mitigate the downstream impacts. So why are you expecting the higher follow through if you control primary care and then based on the fact that you are.
Josh Raskin: Seeing worse performance in Optum health and value based care could you remind us why you think you can control costs better in that environment and Thats, probably a good time to get the refresher on why the strategy to allocate a lot more capital to BDC in the ecosystem totally as best in long term.
Speaker Change: Yes, Josh Thanks, so much for the question, so im going to ask them.
Tim Knowles: Tim just to address the first part of your question then.
Tim Knowles: AMA to talk a little doctor decide to talk a little bit around the Optum health experience during the quarter and the differences of what we're seeing there and the like and as I said in my commentary at the beginning.
Speaker Change: The business is do operate very different kind of models and is not it's not completely surprising to see somewhat different experiences and then I'm going to ask Heather to just do.
Speaker Change: As you can be requested a kind of a refresher on the value based care position. So we will do that also for you. So bandwidth defense is probably going to take a little a few minutes, but Tim if I could ask you to start and then I will pass over to Doctor Ahmed Hassan.
Speaker Change: Yes, Thanks, Josh for the question. So yes, let me just dive in a little bit with a little more detail into some of what we're seeing that's driving the increase in carrier activity now let me start with our fee for service so kind of our non cap a dated community in MA members, we have seen increase in physician outpatient care activity.
Speaker Change: In that population and one of the dynamics that we're seeing as they are generally seeking more preventative care, which is a good thing and that also includes more in home visits more in home clinical assessments and that in and of itself really not the trend driver, but it's the <unk>.
Follow on care that is more than what we would have anticipated and that constitutes specialist visits physician specialist visits as well as some other outpatient services.
Speaker Change: The dynamic at play in our group Medicare advantage business as we're seeing a significant and disproportionate increase in utilization largely within our public sector group retiree business and this is a population that experienced the greatest year over year premium increases.
Speaker Change: And while we've seen a similar dynamic play out historically on in our individual Medicare advantage business win premium increases have been in play we've really never seen this dynamic before in the group MA business and then we're seeing it because of the pressures related to the Medicare funding cuts.
Speaker Change: <unk> that are really driving up premiums in the group retiree business like they really never had before and kind of think groups with premiums going from $50 to $200 and then we did assume that we would see some carrier activity level increases in this population, but we're seeing far surpasses what we would have.
Speaker Change: Reasonably anticipated and in that population is while we are seeing.
Speaker Change: More preventive care more annual wellness visits now more in home clinical assessments, but again the driver there also being really the follow on care that results from that.
Josh Raskin: Hey, Thanks for the question Josh So the results for Optum health to be clear were impacted by the profile of new value based patients and Optum health and the second year of the V 28 phase and we're taking actions to proactively address these issues.
Josh Raskin: Our patient profile post AEP included many new to Medicare as well as new to Optum health, who are meaningfully less engaged by their prior health plans and providers.
Josh Raskin: We believe that market.
Josh Raskin: Specific planned exits driven by 28, causative dynamic and because of the strength and stability of our provider network those patients chose Optum health.
Member profile challenges were not specific to any single Medicare advantage carrier and occurred in multi payer geographies like Texas and Washington.
Josh Raskin: Additionally, we underestimated the impact of <unk> 28 in particular as it relates to the higher acuity structure of our patient population, which is more impacted by the risk model change.
Josh Raskin: Our planned actions around operating cost containment and medical expense management and were not able to offset the cumulative impacts of the 28 and the new member profiles.
Josh Raskin: As it relates to <unk>.
Josh Raskin: Care patterns for Optum health in general in Q1, we see as a busier time for our physicians as we are engaging our patients we've already engaged over 50% of all members and 75% of our complex members. This year. It is particularly important given the member profile of new Medicare and new Optum health patients.
Josh Raskin: Also within Optima health, we're seeing some elevation in outpatient behavioral utilizations.
Josh Raskin: We're taking incremental actions above and beyond what we've planned for in year to improve performance first enhancing access for employed in network PCP.
Josh Raskin: <unk> around new patients to diagnose document and treat conditions, we're expanding homebase revisits and wraparound services.
Josh Raskin: Particularly as it relates to post discharge visits after in patient care.
Tim Knowles: And as Andrew alluded to we've accelerated EMR unification deploying smarter clinical workflows and point of care tools to better adapt to the V 28 religious related changes. Thanks for the question great. Thanks, So much and let me ask Heather to maybe just taken an overview of the value based care proposition and why we continue to believe so strongly in it.
Heather: Sure and just I think what Youre seeing here is as Andrew said, you've got two different business models here and it's important to keep that in mind, a couple of things I'll just point out.
Speaker Change: Now again after the health capitate. His experience. This is specific to senior populations in our experience and a unique environment mindful of again, what the new risk model at year two risk model.
Heather: And keeping in mind, what Dr. <unk> said, we assume and anticipate certain.
Heather: Physician activity in the first part of the year and Thats part of our model because it drives not only that that diagnosis, but the treatment. So we can understand the gaps in care. So thats part of the plan and I think Thats why you don't.
Heather: It's a little different story in Optum help, but as I've emphasized said.
Heather: We need to be mindful of that particularly based on two years of elevated care activity.
Speaker Change: Coming into this year now to your point the outcomes based model or what we call the value based care model should naturally offset some of that for a few reasons as Dr. <unk> mentioned number one engagement is key and that early engagement by a network that's aligned and activated can better identify gaps in care.
Heather: Manage them.
Heather: And support.
Heather: Higher preventive healthcare and reduced emergency visits and hospital visits in addition to that what's unique about Optum health model.
Heather: Is the wraparound services and the in home services, which not only help assess our members in the home, but they're able to then kick off things like post discharge visits.
Heather: Hi.
Heather: More acute acute condition management programs that are critical to those transitions of care and help reduce total cost of care and naturally offset some off trend, but in addition to that result in a better health outcome for patients and a better experience and help them with a healthier life. So those are kind of the basis of our <unk>.
Model you then route the integration of our behavioral health into our model, which is increasingly more an integrated part of our care delivery system.
Heather: It's differentiated about the model and even though to be incredibly directed and respectful of this year, we will see the impact of the revenue.
Heather: Through the year, but the differentiated value of value based care model has meant growth.
Heather: Often health above industry.
Heather: In the past and we believe Youll continue to see that why is that because again, a better care delivery model a better experience for our patients but in addition to that we see very high retention. So these members that need the services that have higher acuity that need a more intensive care model they stay with us.
Heather: And so the work we do today will support the growth in 'twenty six and Thats why were confident in not only the growth in 26 on the membership.
Heather: Active but because there is more members to serve out there in many cases, we're serving a few of the seniors in any respect that geography, and we have more capacity in our networks, but in addition to that it supports our performance I'll. Just note one last thing and that is I think that youre going to watch us paced out while we're still committed to our <unk>.
Heather: Membership growth, we're going to be looking at particular geographies pacing through that to ensure that we're focusing on the new membership.
Heather: With our PCP network and with our in home services and I think Josh I really appreciate the question and thanks, everybody for allowing us to respond to that so all of those fully as we can I mean, just maybe add a couple of comments to that to that last set.
Speaker Change: Comments from Heather when we look into and you have often heard us talk previously about.
Speaker Change: Cohorts of members who choose to join.
Speaker Change: Optum health value based care, what we're seeing in those early cohorts going back to say 2023. For example, those folks who first came in and started to benefit from our value based care approach was seen.
Speaker Change: Basically all metrics outperformance in terms of the way in which that cohort and cohorts before them have performed so what we're seeing here is not really a challenge to the underlying principle of value based care and what we're seeing is how to adjust to a very dramatic price cutting regime, and that's being implemented over the last couple of years by.
Speaker Change: By the administration.
Speaker Change: And it's important to recognize that that was across the average of the industry independent analysis would say that was about a 9% price cut across the industry now that's a significant downdraft in terms of pressure.
Speaker Change: And obviously that affects participants, whether you're a payer or provider in the marketplace and you've seen that effect over the last the first year, we're now well into the second year of all of this.
Speaker Change: What we're seeing during the second year as some of the I would call them second order derivative effects. So I'll give you just a couple of examples of that you've heard warm very explicitly and we've mentioned the other already on the accrual. So second order effect would be for example, as this pricing pressure has continued to press down alongside it.
Speaker Change: Series of underfunded rates increases <unk> seen premiums and benefits start to be affected in the marketplace group premiums have gone up because of these price cuts that is now driving a different behavior from group members and that's what we've picked up in this area and we need to do a better job of being able to predict and anticipate these second and third.
Speaker Change: Order effects when they come but they are direct consequences of this transition.
Speaker Change: Second one, which we referred to and it's really important within the Optum Health story for 2025 is planned exits. So we saw a very significant increase in the number of planned exits across the country last year.
Speaker Change: <unk>.
Speaker Change: As plans chose to respond to the price cuts impressed you buy essentially withdrawing their offer and multiple geographies across the country and what we've seen is an unusually complete vacation of offers by certain plants.
Speaker Change: To put it a different way 100% of participants in a particular payers plan had to find a new home that they had no way of staying in their old home they have to find a new home.
Speaker Change: What we saw when they came to US where we were still offering a plan option. We saw those members had not had the level of engagement in the prior six to eight months before they vacated that plan at the level you would have expected that has a direct consequence on how they are understood in terms of the reimbursement module of the system and that's what's driving.
Speaker Change: And a lot of our issues in Optum health as yet, but again that is a temporary phenomena, which gets fixed during 2025, but it is simply an example of one of the second order derivative effects of this transition.
Speaker Change: Of absorbing this nine or more percent decrease in pricing.
Speaker Change: None of that really speaks to the value of value based care value based care delivers a completely different approach of trying to ensure people have more years of health unless years of health care acute treatment and trying to get ahead of the illness trying to avoid the high cost consequences of late diagnosis and <unk>.
Speaker Change: Tries to make sure that we are encouraging people to think about healthy lifestyle early engagement, making sure that we're heading off problems before they arrive and we know that works based on multiple cohorts of patients that we've been privileged to have the right to manage.
Speaker Change: What we're going through like the rest of the industry is a dramatic really never seen before adjustment in pricing for this marketplace and what we're seeing this year is two or three areas, where the pressure that that has created across the market is creating new dynamics. We haven't seen that's exactly what we're responding to here and we believe that they are largely address.
Speaker Change: <unk> as we go through the rest of this year.
Speaker Change: And in no way undermine our confidence in the value based care strategy of the company.
Josh Raskin: Josh Thanks, so much for the question and I'll move onto the next question.
Speaker Change: Our next question comes from AJ Rice with UBS.
AJ Rice: Thanks, Hi, everybody.
Speaker Change: Just to put a finer point on some of this discussion around especially what's happening.
Speaker Change: Emma side.
Speaker Change: It sounds like Youre, saying most of the elevated care that you are seeing is on the group side and it sounds like you're putting more of that on the benefit and premium changes that have occurred rather than just an underlying uptick in utilization I wanted to make sure I understood that also on the <unk>.
Speaker Change: <unk> AG.
Speaker Change: And the impact of that it doesn't sound like you're calling that out on the insurance side, you're just calling that out on the Optum side and then finally on part D. You had.
Speaker Change: <unk> been cautious about that coming into the year, but you are not mentioning that it also is that playing out about as expected.
Speaker Change: Hey, Jay excuse me. Thank you so much for the question, let me ask Tim to respond.
Tim Knowles: Yes, good morning, a J. Thanks for the question Yeah. So I'll hit those last two pieces.
Tim Knowles: So yes, you are correct. We are really seeing this focused on our community Medicare advantage I and group Medicare advantage book, So we're not seeing it on a chronic special needs population.
Tim Knowles: Or are dual eligible population also not seeing this care activity pattern and our newer members either new to Medicare or new to United and the carrier activity items that we talked about last year provider up coding and some of the pressures on specialty drugs I'm not seeing that unplanned.
Tim Knowles: This either those elements are bolt on tracking very much in line with that in mind with how we've planned on when you think about the split it is slightly more pronounced on our group business, but if you think about our overall fee for service.
Business, It's just I would say just slightly more than the contribution that you would expect on the group side and.
Tim Knowles: We while we certainly do see trends that suggest that where the premiums have increased and members are paying a higher portion of that that that is where we're seeing this pointed pressure on carrier activity on the group business. However, it is very likely that some of the same underlying trends there.
Tim Knowles: We are generating higher cure activity patterns in individual communities.
Tim Knowles: Also at play in the group business.
Tim Knowles: Great. Thanks, So much next question please.
Speaker Change: And our next question comes from Lisa Gill with J P. Morgan.
Lisa Gill: Hey, Matt Good morning, Andrew I, just wanted to go back to that path and the long term growth rate you reiterated that you feel confident you can get back there with.
Lisa Gill: With the 2026 rates looking better we're going to move into the final year of <unk> 28, how do I think about what the key elements are to get back to that long term growth rate.
Lisa Gill: Yes, Lisa thanks, so much for the question so yes, so clearly.
Lisa Gill: We're pleased to see the beginning of recognition of the rate increases, which actually reflect reality, which we haven't seen for last couple of years.
Lisa Gill: But hopefully that will continue to be the stance.
And the data will drive that in the way we saw this year. So very very pleased to see that also pleased to see in the Medicaid books of business come to continue to see great engagement with states that they also adjust to make sure that those rates are appropriate for what we're seeing so those are important.
Lisa Gill: Obviously next year, there will be a further step down in terms of pricing from the V. 28 models. So we can't ignore that that's clear.
Lisa Gill: Reality, but.
Lisa Gill: The way we look at this leases that we are very very much where we see very much the.
Lisa Gill: The end of this transition period in terms of having to absorb the amount of pressure I mean, clearly we're a leader in all of this.
Lisa Gill: Marketplace.
Lisa Gill: <unk>.
Almost certainly a big a fraction if you will of the pressure because of our market leadership position here.
Lisa Gill: We feel like we're very much getting through this we obviously this year have picked up the two or three.
Lisa Gill: Second order derivative effects, which were going to do a much better job of anticipating and managing for as we go into 2026, and we think that an awful lot of the.
Lisa Gill: Issue that we're seeing early in 'twenty five we can fix in 'twenty, five and help us deliver stronger performance for 2006, and we expect that to them via kind of ramp into re acquiring.
Lisa Gill: Target growth rate momentum that we aspire to as an organization.
Lisa Gill: Thank you very much next question.
Speaker Change: And we'll move to our next question from Stephen Baxter with Wells Fargo.
Stephen Baxter: Yeah, Hi, Thanks, just to follow up on the trend discussion can you talk about where MA margins are now expected to shake out inside of your 2025 guidance. What you think is a reasonable timeline for covering the target margins and whether there was any change to what youre thinking there is a reasonable long term margin target in this business posted.
Stephen Baxter: Some of the issues you've had adapting to it and then again the confidence improves margins in 2026, if trend stays at this level. Thank you.
Okay.
Tim Knowles: Students. Thanks, so much I'll ask Tim to respond to that.
Tim Knowles: Thanks, Stephen for the question so the margins that we're anticipating consistent with.
Tim Knowles: The changes we've announced today are still within our targeted margin range for Medicare advantage for 2025, as we look forward to 2026 and.
Tim Knowles: And we include the increases in carrier activity that we're seeing both in the 2025 portion of our bid and also pricing for 2026.
Tim Knowles: At this distance we can accommodate those carrier activity levels.
Tim Knowles: Return to the historical planning target levels that we've always historically assumed.
Tim Knowles: Great. Thanks, so much Tim next question.
Speaker Change: Our next question comes from Erin Wright with Morgan Stanley.
Speaker Change: Great. Thanks for taking my question on the policy Bryan I guess, what is your latest thinking in terms of Jake Peavy Angra form your model has obviously evolved on that Brian Scott Medicaid funding and what sort of permutation.
Speaker Change: You could anticipate there and your ability to navigate that.
Speaker Change: Yes, Aaron Thanks, So much let me ask Patrick come way to respond to you on the Pbms side, and then Christa maybe make a couple of comments on Medicaid if that's okay. So Patrick yes.
Patrick: Yes, Thanks, Erin for the question so first in terms of policy.
Speaker Change: We are leading in the marketplace with transparency choice and affordability and we've had.
Speaker Change: Three major announcements that I think both helped drive the policy environment, but also our reason we've had significant market growth.
Speaker Change: One 100% commercial rebate pass through.
Speaker Change: First large pbms to do that.
Andrew Witty: And Youre seeing that drive positive reaction in the marketplace and it's removing any lingering doubt about our incentives we want lower list prices and lower net prices as Andrew said.
Andrew Witty: Second removing 25% of prior authorizations over 10%.
Andrew Witty: Re authorizations over 10% of prior authorizations, making the system simpler better easier for consumers and clinicians and then third cost based reimbursement for pharmacies and it's really important to know this is for all pharmacies all drugs all clients rolling out already started.
Andrew Witty: We're rolling out and put it across the entire book and you heard from independent community pharmacies.
Andrew Witty: Their support of these changes the last thing I'd just call out just because it's new and it concerns us significantly as the Arkansas.
Andrew Witty: Legislation that the governor signed yesterday.
Andrew Witty: Around <unk> and pharmacy ownership, we're honestly not sure what problem, they're trying to solve but let me be clear on the impact on patients. When you do that we have Genoa pharmacies in the state providing integrated mental and Bayer healthcare. This good cutoff access for those patients with things like schizophrenia severe depression, you have specialty medicine.
Andrew Witty: We may have been serving a patient with cancer for years.
Andrew Witty: And imagine that patient now not getting their medicine and their home.
Andrew Witty: Home infusions for elderly Americans. So they may not be able to get out of their home and we're providing their medications and home delivery for people in rural parts of Arkansas.
Speaker Change: We're significantly concerned onto that this will work with the state and the regulatory process post legislation to try to address those populations and maintain access but we want you to hear clearly from us that are concerned is about patients and maintaining access to patients across the nation to these medicines right Patrick. Thank you Christopher Thanks for the question.
Speaker Change: On the Medicaid side, I think we won't speculate on any specifics but.
Speaker Change: What I do want to emphasize is just regardless of any changes our priority remains the health of our members and ensuring that they have access to high quality coverage.
Speaker Change: As it relates to our business, we haven't really broad footprint across 32 states, we have a variety of programs and products and really decades of experience. So we remain confident in the value of that managed care can provide to our state partners and our ability to support our states as they really navigate through any changes.
Speaker Change: Had a question Christopher Thanks, so much just looping back to the pharmacy section.
Speaker Change: I think Patrick laid things out very well for you, but I also would just I was.
Speaker Change: Encouraged to see in the President's executive order earlier in the week, a kind of an interesting really look at our multiple elements of the pharmacy.
Speaker Change: <unk> chain.
Speaker Change: I think one of the things that has been.
Speaker Change: Honestly, most disappointing over the last year or two is the obsession with the role of the pbms versus everybody else in the system.
Speaker Change: If you read the E O carefully what youll see in there are quite good sensible questions to explore what's going on either side of the PVM.
As the manufacturers and also ultimately many of the providers in the network.
Speaker Change: I think what Youll see from that is the <unk> plays a unique role in trying to bring down drug prices for Americans.
Speaker Change: Does that very very narrow margins oftentimes taken very significant risk in the process.
Speaker Change: <unk> is really the only participant in the system that has that.
Speaker Change: The <unk> win small businesses by successfully drilling and bringing down drug cost for its clients and thats, how it winds more games that do not have the rest of the system operates and.
Speaker Change: I'm hopeful as the administration explores.
Speaker Change: The questions of the raises that this will become a much more thoughtful review of how to reform the whole value chain and not simply won't component, where I think you can make very very serious mistakes, which could really damaged patient access so.
Speaker Change: I was encouraged to see that from from the administration Aaron. Thanks. So much for the question next question.
Speaker Change: And our next question comes from Andrew Mok with Barclays.
Andrew Mok: Hi, Good morning, I was hoping to get your thoughts on the risks and implications of tariffs, particularly around the impact of pharmaceutical tariffs that are currently being contemplated by the administration.
Speaker Change: Yes, Andrew Thanks, so much for the question obviously.
Andrew Mok: It's a dynamic situation in terms of.
Andrew Mok: What may happen around pharmaceutical tariffs are obviously going to be a process now where the administration goes through its analysis and investigation. So we obviously don't know what may or may not come from that but when we look at our extension exposures are that we feel we feel pretty good.
Andrew Mok: I would say better than pretty good in terms of the degrees of price protection mechanisms, we have in pre existing contracts and also various pieces of legislation, which also limit the ability of manufacturers to pass price increases down through the system.
Andrew Mok: So at this point.
Andrew Mok: And again given that we don't know what any tariff may or may not be but when you look at the structure of the marketplace, we feel pretty well positioned for that.
Andrew Mok: Next question.
Dave Windley: Our next question comes from Dave Windley with Jefferies.
Dave Windley: Hi, Good morning, Thanks for taking my question Andrew I. Appreciate your comments about kind of the macro cost of health care in the United States, we have a.
Dave Windley: And then administration that seems.
Dave Windley: A more focused on.
Dave Windley: Budget deficit reduction which entails.
Dave Windley: Cutting to healthcare I guess my my.
Dave Windley: Philosophical question here is why.
Dave Windley: Why isn't modest persistent underfunding of the system the right way to get those costs more in balance and the force innovation in the system.
Dave Windley: And how does United operate in an environment that Mike.
Dave Windley: Might bring that without having.
Dave Windley: Without having the snafu or whatever.
Dave Windley: 28 model brings.
Speaker Change: So David Thanks, so much for the question and I think it's a good and deep question actually.
Speaker Change: So there is no question that what I think we we need is continued strong innovation in new approaches of how to bring together different elements of the system to have a more patient centered impact on health care one of the characteristics I think of the.
Speaker Change: Of all health care marketplaces, but perhaps particularly the U S. Is there are there is no shortage of innovation, but it tends to be point solutions, whether it's a new device or a new drug or a new model of care.
Speaker Change: These things tend to show up in very isolated way. So we spend a lot of money on innovation in America, but we don't see the yield of that innovation and I would argue that because theres not brought together, we don't align incentives, we don't really rethink workflows, we don't we don't try and send to everything around what gives you the best outcome for the patient over the long.
Speaker Change: Lifetime of the patient not just this encounter or even this year, how do you make that peso. How did you give that patient the opportunity for maximum numbers of great health years.
Speaker Change: That for me should be the guiding principle and Thats what value based care is about and it's what United Health Group is committed to innovate and drive behind and I think we have made extraordinary progress in that.
Speaker Change: Now Unfortunately, what we see what we've seen through <unk> 28 is almost.
Speaker Change: Our focus the price cut where the most innovation is going on so you've seen this pressure come exactly into the program, where historically the government has funded Medicare advantage and created a very thoughtful system, which incentivize as participants to the only way a participant can win in Medicare advantage.
Speaker Change: It is to incentivize be able to deliver great care experience and access experience for the member.
Speaker Change: Release enough costs through efficiencies to provide benefits to members and then pay a rebate back to the government right. So everybody wins in that system and that was a very cleverly designed system by the government. Many years ago is being supported by multiple administrations of of both direction. Since then.
Speaker Change: What we saw through the 28 was really a kind of a blunt instrument approach to just take money out of that system and thats whats, causing the disruption here. So I don't think any but we would never have any anxiety about saying look we want to see the healthcare budget grow by less each year, but then we should look at the whole budget, we should look at the whole system in.
Speaker Change: We should look at how we can use tools to do that what we know is that Medicare advantage cost less than traditional Medicare we know that when a Medicare advantage patients is in a fully delegated value based care managed clinic like Optum health, they will save even more money for the system and they will have better personal experience there.
Speaker Change: Better clinical outcomes and the government spends less money.
Speaker Change: Those sorts of integrated approaches, which we think all the response and.
Speaker Change: And it's a bit I made that comment about the President's executive order on pharmacy.
Speaker Change: I kind of invite the same we should be we should be thinking about the whole system and how we align the whole system not simply looking at these kind of individual component approaches, which we've seen over the last few years and I hope very much that just like the pharmacy agenda. The president is laying out for.
Speaker Change: Understanding that we might have a similar one here and that would be very positive because the answer to your question is yes, we should be able to deliver great health care at lower cost with better experience better clinical outcome for people and for the government and that is what the mission of UHT is and that is.
Speaker Change: The goal of value based care and Optum care is also.
Speaker Change: Next question. Thank you very much.
Speaker Change: Our next question comes from Ben Hendrix, with RBC capital markets.
Speaker Change: Hi, Thank you very much I wonder if we could touch briefly on Medicaid is just wanted to get an update on what youre seeing from state renewals through April and if we're still on track to close that rate acuity gap by the end of the year. Thanks.
Chris: Ben Thanks, so much for the question I will ask Chris to answer that for you yeah. Thanks for the question.
Speaker Change: We were encouraged with the progress that we made on rates in the second half of 2020 for what's really continued into our one one rate cycle and as John and Andrew Both mentioned overall the gap between acuity of the population and the right funding is really narrowing with each cycle as well as through some off cycle adjustment that we have seen.
Speaker Change: We have it's really too early to call their rates on seven one, but 35% of our revenue renews in that 71 cycle and with each cycle that base data continues to reflect more recent experience and so we remain optimistic with the collaborative relationships, we have with our states that over the course of the year.
Greg Christopher: This gap will continue to narrow Greg Christopher Thanks, So much our next question. Please.
Lance Wilkes: And our next question comes from Lance Wilkes with Bernstein.
Lance Wilkes: Great. Thanks could you talk a little bit about the first quarter MLR impacts and maybe breaking out the impacts that were driven by the premium increases either subscribed and maybe any sort of deductible increases, but also further impacts as a result of the way in which you are approaching prior authorization any.
Lance Wilkes: Isn't that and then do you have a sense as so maybe increased follow through from your house calls and.
Lance Wilkes: Primary care actions as far as getting follow up visits tied to risk adjustment activity and lastly were there any one time good guys in the first quarter, which perhaps supported medical loss ratio and caused the distinction between <unk> versus guidance. Thanks.
Lance Wilkes: Thanks, so much lines.
Speaker Change: Hi, good morning Lance.
Speaker Change: Peter last part no there were no one time good guys in the quarter.
Speaker Change: That would have supported that so a few things just to point on that so to your first point on any shifts on.
Speaker Change: Preauthorization procedures or any of the element like that impacting no no nothing from that element there.
Speaker Change: Tim noted.
Speaker Change: Certainly we had them.
Speaker Change: A much higher in addition to the group, which is a big factor, we had a much higher level of wellness business in the quarter those those aren't the factor though.
Speaker Change: They are super effective they're not costly they do drive specialty care. However, there are a lot of follow on specialty care.
Speaker Change: And Thats, what we don't know is was that was that something seasonal then has a slightly altered seasonal pattern, but so many that we saw so much activity in wellness visits in some populations frankly at certain populations without two X a year ago levels of wellness fed thats, others up 50%, but it was broad based in terms of that activity.
Speaker Change: That was certainly an element in there.
Speaker Change: And element and well known to all of you also just the change in seasonality due to the IRR driven part D changes think of that as about roughly 90 basis points of impact or so in the quarter also.
Speaker Change: So that would have been an element that versus kind of what you would've typically saying and I think I know you are well aware that was kind of be a factor as we moved into this I'm not sure that was a factor that was so well anticipated and all the in kind of all the analysts' models out there.
Speaker Change: A lot of good reasons, but those <unk> impacts and in that zone.
Speaker Change: Certainly kind of the.
Speaker Change: The Medicare funding reductions as you go into that second year of <unk> 28, also impactful of that think of that roughly in the 60 basis points.
Speaker Change: I can go through a lot of elements there.
Speaker Change: But those are kind of the key factors, but far in a way.
Speaker Change: The increased utilization and the number of profile elements that we've highlighted throughout the course of this call being by far the most impactful things in the quarter. Thanks.
Speaker Change: Thanks, Joe Thanks, so much the next question.
Speaker Change: And our next question comes from Sarah James with Cantor Fitzgerald.
Speaker Change: Thank you.
Speaker Change: Circle back to the tariff question quickly are the penalties under the IRA for pharma manufacturers to raise price above inflation enough to protect you from Paris pass through on Medicare and Im not sure if that implies two exchanges as well, but those bids to earlier like April to June.
Speaker Change: Do you have to assume that tariffs are in place or do you think the states will give you some flexibility to submit two versions of beds with and without tariffs.
Speaker Change: Thanks, so much for the question so as I said earlier, obviously, we like you we don't know yet.
Speaker Change: If when might happen in this territory. So like you we're watchful waiting as you allude to the many kind of less of government protection. If you will within the regulations over the drug companies in terms of their ability to increase price above inflation.
Speaker Change: There are things like Medicaid best price protections to see specifically in the Medicaid area, which would also have potential applications and then of course, we have all various optimal Rex we're relevant in this conversation have their own contractual price protection. So so there are multiple legs of that obviously, we're going to be very carefully making sure that.
Speaker Change: We bid in the context of that debt.
Speaker Change: Kind of mesh of protection.
Speaker Change: And make sure that we do that as thoughtfully as we possibly can but I. Just also just want to reiterate like everybody else. We don't know yet what the reality of this is but we're very attuned to it and I think I've tried to share with you all.
Speaker Change: Sentence that it should not be a significant exposure for us.
Speaker Change: Certainly not this year and we'll be working very closely about bids and the rest as you suggest for next year.
Speaker Change: We have time for just one last question.
Speaker Change: And our last question comes from Jessica <unk> with Piper Sandler.
Jessica: Hi, guys. Thank you so much for the question.
Jessica: Wanted to ask about so you would see us achieve really phenomenal growth and in a year to date up 521000 members through April April almost half of that growth has come from C. SNP plans. So just wondering if you all can elaborate on uht's dominance in the D. SNP market. What do these plans offered the beneficiary wise UHC have been so successful in this segment.
Jessica: And what does the SNP enrollment mean from an economic perspective for you HC and 2025, and then over the long term. Thanks.
Bobby: Yes, Jessica thanks, so much I'll ask Bobby Bobby Hunter, who looks after our <unk> business to respond to that Bobby.
Bobby Hunter: Thanks, Jessica for the question, so I would say it really just overall.
Bobby Hunter: Pleased with our year to date growth in Medicare advantage and as you know we continue to be on track to deliver on our full year growth target of up to 800000 members.
Bobby Hunter: The momentum we had in AEP carried over really nicely into OUP, including notably strong retention of our existing members.
Bobby Hunter: And then really diversified growth across our community HMO plans full dual plans and other plans you mentioned that are designed for members with chronic conditions.
Bobby Hunter: So really both from a mix and volume standpoint, we feel really good about where we sit in 'twenty five and the outlook that that gives us around the membership growth and I would just note really the Medicare advantage plans that we offer the great work that we do from a value based care integration standpoint, with a collection of our providers, both internal and external really position us well to manage these member.
Bobby Hunter: <unk> with chronic complex conditions, and and we're very proud to continue to get to serve more of those members as we progress throughout the year. Thanks. So much for the question Bobby Thanks, So much and I'd like to thank everybody for all of your questions. We appreciate your engagement very much today.
Bobby Hunter: While we're not satisfied with our performance to the start of 2025, I hope you've heard today, our determination to improve on our enthusiasm about the path forward.
Bobby Hunter: We remain deeply committed to the value based care strategy of the company and we believe that that is the way to solve many of America's healthcare problems, both from a cost, but most importantly from a patient experience and outcome perspective.
Bobby Hunter: And I think you many of you who know United well, we'll also recognize that when we encounter.
Bobby Hunter: An issue, we figure out how to work it and how to deal with it and rest assured we all United all going to work or issues that we've encountered in the first quarter solve them and you should count on us to continue to strive towards delivering for everybody, we serve and to make sure that the growth of this company returns to the kind of ranges that you would've expected.
Bobby Hunter: With that I'd like to thank everybody for your time today and we appreciate it.
Speaker Change: And ladies and gentlemen. This concludes today's call. Thank you for your participation you may now disconnect and have a great day.
Bobby Hunter: [music].