Optum didn't build hospitals — it hired their employees

In 2019, former UnitedHealth Group CEO David Wichmann made a clear statement to investors: Optum's growth strategy did not include ownership of inpatient care facilities. In other words, the company would not build hospitals.

Instead, one piece of the plan to eventually make Optum's care delivery arm, Optum Care, a $100 billion business by 2028 was partnering with health systems to manage administrative services such as revenue cycle management and information technology.

"Those will occur in markets where there are maybe less assets for us to accumulate and build from," Mr. Wichmann said at the time. 

Fast forward to 2024, Optum has inked at least nine health system partnerships, most recently with Minneapolis-based Allina Health. Part of that deal includes Optum hiring 2,000 Allina employees, all of whom will continue to support the system's patients and providers.

"Healthcare is changing rapidly and the technological needs to support care delivery are increasingly complex," David Ingham, DO, Allina's vice president and CIO, said Feb. 1. "This new relationship with Optum brings the best of both organizations to the table in support of providers, patients and communities."

Other systems that have outsourced administrative functions and employees to Optum include  Brewer, Maine-based Northern Light Health (1,400 employees hired by Optum); Waukesha, Wis.-based ProHealth Care (800 employees hired); Owensboro (Ky.) Health (575 employees hired); Walnut Creek, Calif.-based John Muir Health (540 employees hired); Cooperstown, N.Y.-based Bassett Healthcare Network (500 employees hired); Boulder (Colo.) Community Health (275 employees hired); and Greenbrae, Calif.-based MarinHealth (an unknown number of employees hired).

"Nobody was going to save the day for us in healthcare," Tim Dentry, Northern Light's president and CEO, told the Portland Press Herald in 2023. "This decision by Northern Light is going to take a huge amount of pressure off of individual entities like [Eastern Maine Medical Center, a hospital parented by the health system]."

Notably, Optum's largest public partnership to date was with SSM Health, which involved the hiring of 2,100 of the St. Louis-based system's employees. The partnership formally began in early 2022 and has since been terminated, an SSM Health spokesperson confirmed with Becker's on Jan. 3. Neither the health system nor Optum elaborated on why the two organizations split or the employment status of the SSM workers.

When Mr. Wichmann discussed Optum Care's $100 billion goal for 2028, Optum as a whole recorded $101.3 billion in revenue the year prior in 2018. Optum Health, the division that encompasses Optum Care, reported revenues of $24.1 billion. Five years later, Optum's revenues for 2023 exceeded $226 billion, and Optum Health surpassed $95 billion. 

Optum also revealed in November it now employs or is affiliated with nearly 90,000 physicians and another 40,000 advanced practice clinicians serving tens of millions of people every year. Optum Care employed or worked with 38,000 physicians in 2018.

On top of the 2019 strategy to not build hospitals, Mr. Wichmann said Optum was also not interested in purchasing post-acute care facilities. Today, Optum owns naviHealth, a post-acute management organization, and it purchased home health provider LHC Group in 2023 for $5.4 billion. It also intends to purchase home and hospice care provider Amedisys for $3.3 billion.

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