Healthcare Financial Analysis: UnitedHealth Group in 2019–2023

Background

This paper provides a financial analysis of UnitedHealth Group, a provider of health insurance and, accordingly, medical services, and one of the US market leaders. The analysis includes annual reporting in the form of income statement, balance sheet, and cash flows for the period from 2019 to 2022-2023. Understanding the financial movements in these documents is extremely important because it makes it possible to assess the company’s business health and growth prospects in critical infrastructure. Comparisons are made between these reporting forms since they are closely related to each other.

It is worth noting right away that medical companies are in many ways less susceptible to current global negative factors, such as the COVID-19 pandemic and its consequences, since the solution to this problem lay on their shoulders and many people, on the contrary, increased their costs specifically for various medical equipment: drugs, supplies, and others. While other business sectors and even the country’s macroeconomic indicators were in decline, medical organizations received many subsidies and increased their profits, which, out of social and global responsibility, were used to develop vaccines, strengthen control over patient health, develop new approaches and support specialists (Waitzberg et al., 2021).

As a result, the growth rate may significantly increase in financial terms in 2020-2021, while the dynamics of future years may remain at the same level as historical experience – more people will begin to pay more attention to their health.

Similar dynamics are reflected at UnitedHealth Group. The company experienced a slight increase in profit in its income statement for 2019-2020, but then the growth almost doubled (YahooFinance, 2023a). However, this fact only signals an increase in volumes, while gross profit maintained its growth rate at the same level, which may be due to increased costs for medical services that have become more expensive during the pandemic (Uche et al., 2021).

Similar trends are observed in the net and operating income indicators, which only demonstrates the organization’s resistance to stressful situations in the market in the financial aspect. Considering that UnitedHealth relies on debt capital instead of equity, as seen from the balance sheet structure, profit growth ensures leveling liquidity risks since the current ratio is less than one (YahooFinance, 2023a). At the same time, current liabilities are growing by 2022 more than current assets, although the company has sufficient leverage over the long term due to a more significant number of long-term assets.

However, operating with negative working capital is the norm for this organization, as well as for many other market leaders in this part of the industry (YahooFinance, 2023b). At the same time, UnitedHealth has a positive and relatively sizeable free cash flow, constantly investing in net business purchases (YahooFinance, 2023a). Investment trends are growing geometrically every year, and even though the company is making dividend payments, its cash flow from financing is also favorable.

Income Statement and Cash Flow

The two statements are directly connected only by the net profit indicator, and the cash flow statement shows where it is sent within the company’s activities. Organizations, including medical ones, can direct free money to the company’s development, which is often reflected in cash flow from investing activities. Suppose the purchase of property, plant, and equipment often signals an expansion or increase in the scale of market presence. In that case, R&D, intangible assets, and similar items can lead to the optimization of internal processes.

UnitedHealth has been steadily investing in line with rising PPE earnings trends, but business acquisitions, which may include R&D and optimization, as mentioned above, will gain much more traction in 2022 and 2023 (YahooFinance, 2023a). In 2022, compared to 2021, this led to a more significant increase in operating profit; therefore, we can conclude that this direction of cash flow positively impacted the insurance company’s profitability. However, the effect almost disappeared in 2023, although, in fact, the financial year has not yet ended, and changes may come into force just in the last calendar days, for example, due to payments to accounts receivables and so on.

The dynamics of profit growth were also accompanied by an expected increase in changes in accounts receivables and payables, much more noticeable in the last article. In 2020, a similar indicator also showed a significant increase, which can be explained by the crisis year, because of which the company’s clients could have difficulties paying for more expensive services, which, nevertheless, were needed here and now. There was no recovery to the pre-COVID level, but instead, there was an increase by 2022 that also remained in 2023, which is a consequence of a significant increase in immediate profits, which are always associated with deferred payments (YahooFinance, 2023a).

However, despite several factors reducing efficiency, investor support continues at the proper level due to increasing dividends. It is very likely that the company’s expansion in the quantitative aspect is now more critical for maintaining its leadership position in the market than qualitative indicators, the emphasis on which will be possible in the coming years, when expansion costs will no longer take up most of the available funds.

Income Statement and Balance Sheet

Analysis of these two statements already more clearly reveals the company’s financial strategy in the context of growing revenue. The cash flow statement shows significant expenses for repaying long-term and short-term debt, which, however, does not reduce its indicators in the balance sheet. This fact may cause concern for investors, but it is income effectiveness, along with growing assets, that offsets this shortcoming of the company (YahooFinance, 2023a). It is in long-term assets that a significant part of the company’s net profit is deposited, which allows it to maintain a high level of solvency, even taking into account the chosen strategy for the development of the capital structure.

Although borrowed funds are now becoming more expensive in the United States, this factor may cause growing liabilities due to high inflation and an increased key rate (TradingEconomics, 2023). Inflation also provokes an increase in prices for medical services from the company’s suppliers, which is reflected in the cost of sold goods, and financing of these expenses occurs through predominantly short-term liabilities, which just outpaced the growth of assets in 2022-2023 (YahooFinance, 2023a). At the same time, stockholder’s equity shows the same growth dynamics, slightly slower in percentage terms than the increase in debt.

References

TradingEconomics. (2023). United States Fed Funds Interest Rate. Web.

Uche, E., Marcus, S. N., Effiom, L., & Okoronkwo, C. (2021). Food and healthcare accessibility during COVID-19 pandemic. Heliyon, 7(12). Web.

Waitzberg, R., Quentin, W., Webb, E., & Glied, S. (2021). The structure and financing of health care systems affected how providers coped with COVID‐19. The Milbank Quarterly, 99(2), 542. Web.

YahooFinance. (2023a). UnitedHealth Group Incorporated (UNH). Web.

YahooFinance. (2023b). Elevance Health, Inc. (ELV). Web.

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StudyCorgi. "Healthcare Financial Analysis: UnitedHealth Group in 2019–2023." June 5, 2025. https://studycorgi.com/healthcare-financial-analysis-unitedhealth-group-in-20192023/.

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StudyCorgi. 2025. "Healthcare Financial Analysis: UnitedHealth Group in 2019–2023." June 5, 2025. https://studycorgi.com/healthcare-financial-analysis-unitedhealth-group-in-20192023/.

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