(MENAFN- AsiaNet News)

• New CFO Wayne DeVite outlined a three-year turnaround plan focused on financial discipline, portfolio simplification, and tighter Optum integration.
• The company is exiting unprofitable Medicare Advantage and ACA products while pricing for a 10% medical cost trend to protect margins.
• UnitedHealth expects buybacks to resume in 2026 as debt levels fall, supported by asset sales and renewed focus on U.S.-based operations.

UnitedHealth Group is overhauling its business to rebuild profitability and restore what its new Chief Financial Officer, Wayne DeVite, described as the company's“swagger” by 2027. The insurer is shedding unprofitable books, re-pricing for higher medical costs, integrating its Optum units more tightly, and selling non-core assets to refocus on U.S. operations and long-term margin recovery.

Speaking at the UBS Global Healthcare Conference, DeVite outlined a three-year turnaround plan centered on financial discipline and simplification. He said CEO Andrew Witty told him before he rejoined that“everything can be fixed” and that“a lot of it can be fixed as early as next year.” DeVite added that management is“focused on all the right areas right now,” with the goal of demonstrating a measurable improvement in operating performance by 2027.

Shedding Low-Return Lives To Rebuild Profitability

UnitedHealth expects to lose about one million Medicare Advantage members this year as it withdraws from unprofitable products and reprices others. Roughly 600,000 PPO lives are being exited entirely, about 200,000 group MA lives were either repriced or dropped, and another 200,000 members are expected to leave across dual-eligible and non-dual categories. DeVite said these exits reflect a disciplined decision to stop competing where the company was not earning a fair return.

He said Optum Health will also trim about 200,000 PPO lives to return to the core value-based care model, built around tightly controlled physician networks and Medicare and dual populations. Growth in lives is not expected in 2026, with expansion planned to resume in 2027 once integration and cost measures are complete.

On the public-exchange side, UnitedHealth raised rates by more than 25% across its Affordable Care Act plans and expects to lose roughly two-thirds of that membership. The company assumed premium-tax-credit subsidies would not be extended, and early indications suggest that remains the case.

Pricing For A 10% Medical Trend

UnitedHealth is using a 10% medical cost trend in its 2026 pricing, up from 7.5%, to account for higher physician workload, drug launches, tariffs, AI-related revenue-cycle pressures, and what DeVite called“residual” cost drivers that“can't be explained.” He said those residual factors were carried forward because many of 2025's inflationary forces are expected to persist.

DeVite said the approach is intended to be prudent: if the assumption proves right, pricing will have been accurate, and if it proves conservative, the company can adjust product design in 2027. He expects Medicare Advantage margins to improve gradually, with a projected increase of about 50 basis points next year and a move toward the upper end of the 2–4% range in 2027.

Asset Sales, De-Leverage, And Buyback Return

The reset extends beyond insurance. UnitedHealth is streamlining its portfolio to focus on the U.S. market and Optum platforms. DeVite said that smaller and international holdings are under review, and that at least one sale is expected to be signed within 30 to 90 days, with completion of divestitures targeted for mid-2026.

Proceeds will help reduce the company's debt-to-capital ratio to roughly 40%, allowing buybacks to resume in the second half of 2026. DeVite said the dividend will“remain intact and growing” and described repurchases as a“massively compounding effect for our investors.” Capital will also be redeployed into domestic M & A, particularly in AI and fintech.

Fixing Optum And Rebuilding Optum Insight

DeVite said much of the next 18 months will be spent finishing what past acquisitions left incomplete. Optum Health will migrate its disparate systems to a single chassis, including unified patient-accounting and Epic platforms, to improve visibility into care delivery and costs. He said prior deals were handled“integration light,” connecting only the basic“electricity and plumbing,” a gap the company now intends to close.

Optum Insight, still recovering from the Change Healthcare cyberattack, is adding more than 2,000 AI engineers and has begun selling new analytics and automation tools. Six new clients have signed in the past 90 days. DeVite said the segment's margins and recurring revenue are expected to accelerate through 2026 and 2027 as those investments mature.

Strong Star Ratings And Pricing Cushion For Unknowns

UnitedHealth already knows its 2027 Medicare Advantage star ratings, which DeVite described as“quite strong again.” He said this positions the company to be competitive as it enters the 2027 rate environment and continues to invest in strengthening its 2028 scores.

On new weight-loss drug coverage, DeVite said it remains too early to gauge how GLP-1 reimbursement will unfold, but noted that the 10% trend assumption includes residual flexibility to handle such unknowns. He said the company's pricing remains solid given the current policy uncertainty.

Stocktwits Traders See Strong Support For UNH

On Stocktwits, retail sentiment for UNH was 'neutral' amid 'high' message volume.

UNH sentiment and message volume as of November 11 | Source: Stocktwits

One user noted that UnitedHealth appeared to be holding key support near $318 and indicated plans to stay long on the stock. 

Another user mentioned taking advantage of the recent dip, eyeing a potential rebound toward the $ 350 to $360 range.

UnitedHealth's stock has declined 35% so far in 2025.

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