United Healthcare 2003 Annual Report Download - page 27

UnitedHealth Group 25
the addition of 430,000 individuals served, partially offset by customers converting to self-funded,
fee-based arrangements and UnitedHealthcare’s targeted withdrawal of risk-based offerings from
unprofitable arrangements with customers using multiple benefit carriers.
Ovations’ year-over-year Medicare+Choice enrollment remained relatively stable, with 230,000
individuals served as of December 31, 2003. Medicaid enrollment increased by 75,000, or 7%, due to
strong growth in the number of individuals served by AmeriChoice over the past year.
Uniprise
Uniprise provides network-based health and well-being services, business-to-business transaction
processing services, consumer connectivity and technology support services to large employers and
health plans. Uniprise revenues in 2003 were $3.1 billion, representing an increase of 14% over 2002.
This increase was driven primarily by growth of 6% in the number of individuals served by Uniprise
during 2003, annual service fee rate increases for self-insured customers, and a change in customer
funding mix during 2002. Uniprise served 9.1 million individuals and 8.6 million individuals as of
December 31, 2003 and 2002, respectively.
Uniprise earnings from operations in 2003 were $610 million, representing an increase of 18% over
2002. Operating margin for 2003 improved to 19.6% from 19.0% in 2002. Uniprise has expanded its
operating margin through operating cost efficiencies derived from process improvements, technology
deployment and cost management initiatives that have reduced labor and occupancy costs in its
transaction processing and customer service, billing and enrollment functions. Additionally, Uniprise’s
infrastructure can be scaled efficiently, allowing its business to grow revenues at a proportionately
higher rate than the associated growth in operating expenses.
Specialized Care Services
Specialized Care Services is a portfolio of health and well-being companies, each serving a specialized
market need with a unique offering of benefits, networks, services and resources. Specialized Care
Services revenues during 2003 of $1.9 billion increased by $369 million, or 24%, over 2002. This
increase was principally driven by an increase in the number of individuals served by United Behavioral
Health, its mental health benefits business; Dental Benefit Providers, its dental services business; and
Spectera, its vision care benefits business; as well as rate increases related to these businesses.
Earnings from operations in 2003 of $385 million increased $99 million, or 35%, over 2002.
Specialized Care Services’ operating margin increased to 20.5% in 2003, up from 19.0% in 2002. This
increase was driven primarily by operational and productivity improvements at United Behavioral
Health. With the continuing growth of the Specialized Care Services segment, we are consolidating
production and service operations to a segmentwide service and production infrastructure to improve
service, quality and consistency, and to enhance productivity and efficiency.
Ingenix
Ingenix is an international leader in the field of health care data analysis and application, serving
pharmaceutical companies, health insurers and other payers, physicians and other health care
providers, large employers and governments. Ingenix revenues in 2003 of $574 million increased by
$83 million, or 17%, over 2002. This was driven primarily by new business growth in the health
information business.
Earnings from operations in 2003 were $75 million, up $20 million, or 36%, from 2002. Operating
margin was 13.1% in 2003, up from 11.2% in 2002. The increase in the operating margin was primarily
due to growth in the health information business.