UnitedHealth Continues to Execute Well as the Top Managed Care Organization

Under one roof, UnitedHealth combines a top-tier health insurer (UnitedHealthcare), pharmacy benefit manager (Optum Rx), provider (Optum Health), and health analytics franchise (Optum Insight). The company's integrated strategy has resulted in some of the best returns in the industry in recent years and has been copied at least in part by the late 2018 mergers at CVS Health, which added Aetna's medical insurance assets to its existing retail stores and market-leading PBM, and Cigna, which added Express Scripts' PBM assets to its existing medical insurance operations. Outside of substantial regulator-led reforms, we think these vertically integrated organizations could help bend the healthcare cost curve in the United States, and UnitedHealth should be one of the key leaders of that charge.