“This mix impact implies negative margins near double digits for these new patients, which will improve meaningfully in 2026.”

In context

“n. Let me dive a bit deeper specifically into factors affecting our value-based care business. First, V28. This industry-wide shift is effectively a price reduction. That we now estimate creating an $11 billion headwind over three years for Optum Health, with $7 billion that'll be realized through 2025. That is $2 billion and $1 billion, respectively, more than our initial estimates. While we also overestimated the impact and misexecuted the planned efforts to offset these V28 funding cuts. Second, enrollment mix. Consistent with Q1, 2025, we have an unanticipated number of new to Optum Health patients who are previously underserved. These new patients are largely in markets where numerous plan exits occurred, they include complex patients who require time to be managed effectively by us. This mix impact implies negative margins near double digits for these new patients, which will improve meaningfully in 2026. Lastly, the elevated medical trend we recognize in the second quarter was exacerbated by insufficient pricing within UnitedHealthcare and other payer partners. Despite these headwinds, Optum's fully accountable value-based care business is delivering an operating margin of about one percent in 2025. This compares to full year operating margins of over three percent in 2024 and nearly five percent in 2023. A large part of the mythic localized management approach, which we are addressing with urgency. We are driving to a consistent and much more concentrated regional operating model with four market leaders. We are evaluating our position in each market. We will shift risk back to the original underwriters until we have the hardened capacity to navigate it under value-based constructs. And”