UnitedHealthcare Offers Buyouts Amid Cost-Cutting Efforts
UnitedHealthcare is offering certain employees in its benefits operations unit voluntary buyouts if they resign by March 3, CNBC reports. If a sufficient number of employees do not accept the buyouts, the company plans to conduct layoffs, according to internal sources.
The move follows a tumultuous year for UnitedHealth Group, including:
- The fatal shooting of UnitedHealthcare CEO Brian Thompson in December.
- A costly cyberattack on its subsidiary Change Healthcare in February 2024, exposing 190 million people’s health data.
- Rising medical expenses for Medicare Advantage.
The company has not disclosed how many employees are affected, but the benefits operations unit manages customer service, claims, and enrollment. Eligible workers include those in corporate, consumer operations, core services, and provider services.
Severance & Employee Reactions
- Termination date: No earlier than May 1, possibly extending to November 13 for some.
- Severance: Based on tenure and salary grade; employees affected by future layoffs may receive less favorable benefits.
- Employees were shocked by the news, especially since UnitedHealth Group reported record-breaking $400.3 billion in revenue for 2024.
Company’s Cost-Cutting Strategy
- UnitedHealth executives cite “digital adoption” and AI-driven modernization as key to reducing costs.
- The company previously laid off employees in its Optum division last year.
- Despite cost-cutting, 3,200 open positions remain listed on UnitedHealth Group’s careers page.
The announcement comes as UnitedHealth Group faces increasing scrutiny over healthcare costs, exacerbated by recent crises and financial pressures. Shares of the company rose 2% on Wednesday following the news.
