What caused UnitedHealth's operating profit fluctuations in 2022-2024?

UnitedHealth's operating profit experienced a decline of 2.51% in 2024, with the operating income cum yoy growth rate being -2.51% as of December 31, 2024. The fluctuations in UnitedHealth's operating profit from 2022 to 2024 can be attributed to several factors: |code|Ticker|Name|Date|Operating Income (FY) YoY|Operating Income (FY)|market_code| |---|---|---|---|---|---|---| |UNH|UNH.N|UnitedHealth Group|2020|15.35509704688282|2.0742E10|169| |UNH|UNH.N|UnitedHealth Group|2021|7.559541027866165|2.231E10|169| |UNH|UNH.N|UnitedHealth Group|2022|18.077095472882114|2.6343E10|169| |UNH|UNH.N|UnitedHealth Group|2023|10.51133128345291|2.9112E10|169| |UNH|UNH.N|UnitedHealth Group|2024|-2.510992030777686|2.8381E10|169| 1. **Increase in Medical Costs**: One of the primary reasons for the decline in operating profit margins is the increase in medical costs. UnitedHealth's medical costs rose by 16.1% year-over-year, reaching $62.2 billion in the fourth quarter. This increase was due to several factors, including the resumption of elective procedures by more seniors, claims related to COVID-19 activities and RSV vaccinations, and other service utilization. 2. **Elevated Claims**: The company's Medicare Advantage business experienced an increase in claims, which contributed to the higher medical costs. This trend was observed in the fourth quarter, where claims rose due to various factors such as COVID-19 activities, RSV vaccinations, and other service utilization. 3. **Market Dynamics**: The healthcare industry is sensitive to market dynamics and external factors. The company's operating efficiencies and consumer experiences improved, leading to a better operating cost ratio of 13.2% in 2024, up from 14.7% in 2023. However, the impact of these improvements was partly offset by the increase in medical costs and a decline in membership across global commercial and Medicaid businesses. In conclusion, UnitedHealth's operating profit fluctuations in 2022-2024 were primarily driven by the rise in medical costs and elevated claims, which offset the improvements in operating efficiencies and consumer experiences.