- Combined Health Services revenues for the third quarter of 2010 increased $771 million or 14 percent to $6.2 billion. The revenue advance was driven by growth in consumers served through pharmaceutical benefit management programs and public sector behavioral health programs and increased health care technology software and service revenues.
- Consistent with the first half of 2010, third quarter operating margin was impacted year-over-year by changes in performance-based pharmaceutical benefit management contracts with Medicare Part D plan sponsors in response to regulatory changes in that market, as well as higher levels of investment in areas of business expansion and growth. Accordingly, the third quarter Health Services combined operating margin decreased and combined earnings from operations of $352 million decreased $80 million or 19 percent year-over-year.
OptumHealth is a national leader in health and wellness services. Employers, payers and public sector organizations use OptumHealth behavioral health solutions, clinical care management, financial services and specialty offerings such as dental and vision. OptumHealth helps consumers navigate the health care system, finance their health care needs and better achieve their health and well-being goals.
- OptumHealth revenues grew $54 million or 4 percent year-over-year to $1.47 billion in the third quarter of 2010.
- Third quarter 2010 earnings from operations of $143 million decreased by $29 million or 17 percent year-over-year, and the operating margin decreased by 2.5 percentage points to 9.7 percent. The year-over-year decreases in earnings from operations and operating margin reflect growth in lower margin public sector business, new market development and startup costs, costs related to the implementation of Mental Health Parity legislation and the year-over-year decline in the volume of higher margin business serving customers in the commercial risk market segment. Both earnings from operations and operating margin were ahead of management's original 2010 outlook, due to stronger-than-expected revenue growth and cost management.
- At September 30, 2010, OptumHealth Financial Services assets under management grew 28 percent year-over-year to $1.07 billion, and the business grew to 2 million consumer accounts, up 10 percent year-over-year, as growth in dedicated health banking activities continues. OptumHealth Financial Services increased the electronic transmission of medical payments over its connectivity network by 18 percent year-over-year to $11.2 billion in the quarter.
Ingenix is a leader in the field of health care information, services and consulting, serving physicians, hospitals and other health care providers, large employers and governments, health insurers and benefits payers and pharmaceutical companies.
- Ingenix third quarter 2010 revenues increased $111 million or 23 percent year-over-year to $592 million. Third quarter sales bookings increased 31 percent year-over-year, driven by strength in consulting services for care providers and payers and in business process outsourcing services.
- The Ingenix contract revenue backlog of $3.2 billion at September 30, 2010, up 48 percent year-over-year and 36 percent sequentially, reflected both acquisition-related backlog expansion and organic growth.
- Ingenix third quarter earnings from operations of $70 million increased 9 percent year-over-year. The third quarter operating margin of 11.8 percent reflects lower margin business mix, continued margin pressure in the pharmaceutical services business, and continued investments in new growth areas.
Prescription Solutions offers a comprehensive array of pharmacy benefit management and specialty pharmacy management services to employer groups, union trusts, seniors and commercial health plans.
- Prescription Solutions third quarter revenues of $4.2 billion grew 17 percent or $606 million year-over-year, driven by growth in people served and related higher prescription volumes.
- As in the first half of 2010, program changes in performance-based contracts with Medicare Part D plan sponsors that responded to regulatory changes in that market impacted third quarter earnings from operations and operating margin. This pressure was partially offset by membership growth, increased use of mail service and generic drugs by consumers and effective operating cost management. Earnings from operations of $139 million decreased by $57 million year-over-year as the operating margin normalized at 3.3 percent.
SOURCE UnitedHealth Group