UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________________________________

Form 10-Q

__________________________________________________________



~~[X]~~☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, ~~2019~~2020



~~[ ]~~☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM _______ TO _______

Commission File Number: 1-10864

__________________________________________________________

UnitedHealth Group Incorporated

(Exact name of registrant as specified in its charter)

__________________________________________________________



Delaware		41-1321939
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
UnitedHealth Group Center		55343
9900 Bren Road East
~~UnitedHealth Group Center~~ ~~9900 Bren Road East~~ Minnetonka,	Minnesota		~~55343~~
(Address of principal executive offices)		(Zip Code)

~~(952)~~ (952) 936-1300

(Registrant’s telephone number, including area code)

_________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	UNH	NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ~~[X]~~☒ No ~~[ ]~~☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ~~[X]~~☒ No ~~[ ]~~☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act



Large accelerated filer	~~[X]~~☒	Accelerated filer	~~[ ]~~☐	Non-accelerated filer	~~[ ]~~☐
Smaller reporting company	~~[ ]~~☐			Emerging growth company	~~[ ]~~☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ~~[ ]~~ ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ~~[ ]~~☐ No ~~[X]~~☒

~~Securities registered pursuant to Section 12(b) of the Act:~~



~~Title of each class~~	~~Trading Symbol(s)~~	~~Name of each exchange on which registered~~
~~Common Stock, $.01 par value~~	~~UNH~~	~~New York Stock Exchange, Inc.~~

As of April 30, ~~2019,~~2020, there were ~~950,343,113~~948,379,502 shares of the registrant’s Common Stock, $.01 par value per share, issued and outstanding.

UNITEDHEALTH GROUP

Table of Contents


				Page				Page

Part I. Financial Information	Part I. Financial Information				Part I. Financial Information
Item 1.	Item 1.	Financial Statements (unaudited)		1	Item 1.	Financial Statements (unaudited)		1
		Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018		1		Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019		1
		Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2019 and 2018		2		Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2020 and 2019		2
		Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2019 and 2018		3		Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2020 and 2019		3
		Condensed Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2019 and 2018		4		Condensed Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2020 and 2019		4
		Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018		5		Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2020 and 2019		5
		Notes to the Condensed Consolidated Financial Statements		6		Notes to the Condensed Consolidated Financial Statements		6
		1.	Basis of Presentation	6		1.	Basis of Presentation	6
		2.	Investments	7		2.	Investments	7
		3.	Fair Value	8		3.	Fair Value	9
		4.	Medical Costs Payable	10		4.	Medical Costs Payable	10
		5.	Commercial Paper and Long-Term Debt	11		5.	Short-Term Borrowings and Long-Term Debt	11
		6.	Commitments and Contingencies	12		6.	Commitments and Contingencies	12
		7.	Segment Financial Information	13		7.	Segment Financial Information	13
Item 2.	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		14	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		14
Item 3.	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		21	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		21
Item 4.	Item 4.	Controls and Procedures		22	Item 4.	Controls and Procedures		22
Part II. Other Information	Part II. Other Information				Part II. Other Information
Item 1.	Item 1.	Legal Proceedings		22	Item 1.	Legal Proceedings		22
Item 1A.	Item 1A.	Risk Factors		22	Item 1A.	Risk Factors		22
Item 2.	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		22	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		23
Item 6.	Item 6.	Exhibits		23	Item 6.	Exhibits		24
Signatures	Signatures			24	Signatures			25

PART I

ITEM 1. FINANCIAL STATEMENTS

UnitedHealth Group

Condensed Consolidated Balance Sheets

(Unaudited)


(in millions, except per share data)	March 31, 2019			December 31, 2018			March 31, 2020			December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	12,407		$	10,866		$	21,569		$	10,985
Short-term investments	3,303			3,458			2,876			3,260
Accounts receivable, net	12,826			11,388			14,613			11,822
Other current receivables, net	7,631			6,862			10,275			9,640
Assets under management	2,951			3,032			2,866			3,076
Prepaid expenses and other current assets	3,697			3,086			6,608			3,851
Total current assets	42,815			38,692			58,807			42,634
Long-term investments	33,553			32,510			36,578			37,209
Property, equipment and capitalized software, net	8,230			8,458			8,173			8,704
Goodwill	59,379			58,910			65,302			65,659
Other intangible assets, net	9,245			9,325			10,199			10,349
Other assets	7,975			4,326			10,008			9,334
Total assets	$	161,197		$	152,221		$	189,067		$	173,889
Liabilities, redeemable noncontrolling interests and equity
Current liabilities:
Medical costs payable	$	21,139		$	19,891		$	22,772		$	21,690
Accounts payable and accrued liabilities	16,900			16,705			22,845			19,005
Commercial paper and current maturities of long-term debt	3,919			1,973
Short-term borrowings and current maturities of long-term debt							15,828			3,870
Unearned revenues	2,530			2,396			2,509			2,622
Other current liabilities	14,445			12,244			14,652			14,595
Total current liabilities	58,933			53,209			78,606			61,782
Long-term debt, less current maturities	34,419			34,581			35,779			36,808
Deferred income taxes	2,786			2,474			3,030			2,993
Other liabilities	8,554			5,730			10,048			10,144
Total liabilities	104,692			95,994			127,463			111,727
Commitments and contingencies (Note 6)
Redeemable noncontrolling interests	2,054			1,908			1,741			1,726
Equity:
Preferred stock, $0.001 par value - 10 shares authorized; no shares issued or outstanding	—			—			—			—
Common stock, $0.01 par value - 3,000 shares authorized; 953 and 960 issued and outstanding	10			10
Common stock, $0.01 par value - 3,000 shares authorized; 947 and 948 issued and outstanding							10			9
Additional paid-in capital							—			7
Retained earnings	55,472			55,846			62,327			61,178
Accumulated other comprehensive loss	(3,758		)	(4,160		)	(5,360		)	(3,578		)
Nonredeemable noncontrolling interests	2,727			2,623			2,886			2,820
Total equity	54,451			54,319			59,863			60,436
Total liabilities, redeemable noncontrolling interests and equity	$	161,197		$	152,221		$	189,067		$	173,889

See Notes to the Condensed Consolidated Financial Statements

UnitedHealth Group

Condensed Consolidated Statements of Operations

(Unaudited)


	Three Months Ended March 31,						Three Months Ended March 31,
(in millions, except per share data)	2019			2018			2020			2019
Revenues:
Premiums	$	47,513		$	44,084		$	50,640		$	47,513
Products	8,072			6,702			8,431			8,072
Services	4,318			4,104			4,985			4,318
Investment and other income	405			298			365			405
Total revenues	60,308			55,188			64,421			60,308
Operating costs:
Medical costs	38,939			35,863			41,000			38,939
Operating costs	8,517			8,506			10,015			8,517
Cost of products sold	7,381			6,184			7,687			7,381
Depreciation and amortization	639			582			723			639
Total operating costs	55,476			51,135			59,425			55,476
Earnings from operations	4,832			4,053			4,996			4,832
Interest expense	(400		)	(329		)	(437		)	(400		)
Earnings before income taxes	4,432			3,724			4,559			4,432
Provision for income taxes	(875		)	(800		)	(1,094		)	(875		)
Net earnings	3,557			2,924			3,465			3,557
Earnings attributable to noncontrolling interests	(90		)	(88		)	(83		)	(90		)
Net earnings attributable to UnitedHealth Group common shareholders	$	3,467		$	2,836		$	3,382		$	3,467
Earnings per share attributable to UnitedHealth Group common shareholders:
Basic	$	3.62		$	2.94		$	3.56		$	3.62
Diluted	$	3.56		$	2.87		$	3.52		$	3.56
Basic weighted-average number of common shares outstanding	958			966			949			958
Dilutive effect of common share equivalents	17			21			13			17
Diluted weighted-average number of common shares outstanding	975			987			962			975
Anti-dilutive shares excluded from the calculation of dilutive effect of common share equivalents	8			7			10			8

See Notes to the Condensed Consolidated Financial Statements

UnitedHealth Group

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)



	Three Months Ended March 31,						Three Months Ended March 31,
(in millions)	2019			2018			2020			2019
Net earnings	$	3,557		$	2,924		$	3,465		$	3,557
Other comprehensive income (loss):
Gross unrealized gains (losses) on investment securities during the period	520			(378		)
Other comprehensive (loss) income:
Gross unrealized (losses) gains on investment securities during the period							(349		)	520
Income tax effect	(119		)	86			80			(119		)
Total unrealized gains (losses), net of tax	401			(292		)
Gross reclassification adjustment for net realized losses (gains) included in net earnings	4			(19		)
Total unrealized (losses) gains, net of tax							(269		)	401
Gross reclassification adjustment for net realized (gains) losses included in net earnings							(18		)	4
Income tax effect	(1		)	4			4			(1		)
Total reclassification adjustment, net of tax	3			(15		)	(14		)	3
Total foreign currency translation losses	(2		)	(1		)	(1,499		)	(2		)
Other comprehensive income (loss)	402			(308		)
Other comprehensive (loss) income							(1,782		)	402
Comprehensive income	3,959			2,616			1,683			3,959
Comprehensive income attributable to noncontrolling interests	(90		)	(88		)	(83		)	(90		)
Comprehensive income attributable to UnitedHealth Group common shareholders	$	3,869		$	2,528		$	1,600		$	3,869

See Notes to the Condensed Consolidated Financial Statements

UnitedHealth Group

Condensed Consolidated Statements of Changes in Equity

(Unaudited)


	Common Stock				Additional Paid-In Capital				Retained Earnings			Accumulated Other Comprehensive (Loss) Income						Nonredeemable Noncontrolling Interests				Total Equity				Common Stock						Additional Paid-In Capital				Retained Earnings				Accumulated Other Comprehensive Income (Loss)								Nonredeemable Noncontrolling Interests				Total Equity
(in millions)	Shares		Amount					Net Unrealized (Losses) Gains on Investments				Foreign Currency Translation Losses
																										Shares			Amount				Additional Paid-In Capital				Retained Earnings				Net Unrealized Gains (Losses) on Investments				Foreign Currency Translation Losses				Nonredeemable Noncontrolling Interests				Total Equity
Balance at January 1, 2020																										948			$	9						$				589			$	(4,167	)
Adjustment to adopt ASU 2016-13																																				(28		)														(28		)
Net earnings																																				3,382												59				3,441
Other comprehensive (loss) income																																								(283		)		(1,499		)						(1,782		)
Issuances of common stock, and related tax effects																										5			1			320																				321
Share-based compensation																																234																				234
Common share repurchases																										(6	)		—			(510		)		(1,181		)														(1,691		)
Cash dividends paid on common shares ($1.08 per share)																																				(1,024		)														(1,024		)
Redeemable noncontrolling interests fair value and other adjustments																																(51		)																		(51		)
Acquisition and other adjustments of nonredeemable noncontrolling interests																																																50				50
Distribution to nonredeemable noncontrolling interests																																																(43		)		(43		)
Balance at March 31, 2020																										947			$	10		$		—			$	62,327			$	306			$	(5,666	)		$	2,886			$	59,863

Balance at January 1, 2019	960		$	10			$	—				$	55,846		$	(264	)				$				(3,896	)		$	2,623		$	54,319			960			$	10			$	—			$	55,846			$	(264	)		$	(3,896	)	$	2,623	$	54,319
Adjustment to adopt ASU 2016-02									(13		)							(5		)		(18		)												(13		)										(5		)		(18		)
Net earnings									3,467									60				3,527														3,467												60				3,527
Other comprehensive income (loss)												404			(2		)					402																		404				(2		)						402
Issuances of common stock, and related tax effects	5		—		56																	56				5			—			56																				56
Share-based compensation					239																	239										239																				239
Common share repurchases	(12	)	—		(34		)		(2,968		)											(3,002		)		(12	)		—			(34		)		(2,968		)														(3,002		)
Cash dividends paid on common shares ($0.90 per share)									(860		)											(860		)												(860		)														(860		)
Redeemable noncontrolling interests fair value and other adjustments					(152		)															(152		)								(152		)																		(152		)
Acquisition and other adjustments of nonredeemable noncontrolling interests					(109		)											132				23										(109		)														132				23
Distribution to nonredeemable noncontrolling interests																		(83		)		(83		)																								(83		)		(83		)
Balance at March 31, 2019	953		$	10	$	—			$	55,472		$	140		$	(3,898	)	$	2,727			$	54,451			953			$	10		$	—			$	55,472			$	140			$	(3,898	)		$	2,727			$	54,451

Balance at January 1, 2018	969		$	10	$	1,703			$	48,730		$	(13	)	$	(2,654	)	$	2,057			$	49,833
Adjustment to adopt ASU 2016-01									(24		)	24										—
Net earnings									2,836									53				2,889
Other comprehensive loss												(307		)	(1		)					(308		)
Issuances of common stock, and related tax effects	5		—		415																	415
Share-based compensation					206																	206
Common share repurchases	(12	)	—		(2,324		)		(326		)											(2,650		)
Cash dividends paid on common shares ($0.75 per share)									(722		)											(722		)
Acquisition of nonredeemable noncontrolling interests																		423				423
Distribution to nonredeemable noncontrolling interests																		(50		)		(50		)
Balance at March 31, 2018	962		$	10	$	—			$	50,494		$	(296	)	$	(2,655	)	$	2,483			$	50,036

See Notes to the Condensed Consolidated Financial Statements

UnitedHealth Group

Condensed Consolidated Statements of Cash Flows

(Unaudited)


	Three Months Ended March 31,						Three Months Ended March 31,
(in millions)	2019			2018			2020			2019
Operating activities
Net earnings	$	3,557		$	2,924		$	3,465		$	3,557
Noncash items:
Depreciation and amortization	639			582			723			639
Deferred income taxes	134			(74		)	202			134
Share-based compensation	243			208			231			243
Other, net	42			27			45			42
Net change in other operating items, net of effects from acquisitions and changes in AARP balances:
Accounts receivable	(1,421		)	(1,579		)	(2,652		)	(1,421		)
Other assets	(1,495		)	(3,232		)	(4,249		)	(1,495		)
Medical costs payable	1,125			1,313			1,120			1,125
Accounts payable and other liabilities	318			2,821			4,137			318
Unearned revenues	92			5,379			(79		)	92
Cash flows from operating activities	3,234			8,369			2,943			3,234
Investing activities
Purchases of investments	(3,540		)	(3,891		)	(3,866		)	(3,540		)
Sales of investments	1,510			1,002			2,170			1,510
Maturities of investments	1,711			1,504			1,726			1,711
Cash paid for acquisitions, net of cash assumed	(689		)	(2,583		)	(929		)	(689		)
Purchases of property, equipment and capitalized software	(562		)	(477		)	(469		)	(562		)
Other, net	154			(72		)	(165		)	154
Cash flows used for investing activities	(1,416		)	(4,517		)	(1,533		)	(1,416		)
Financing activities
Common share repurchases	(3,002		)	(2,650		)	(1,691		)	(3,002		)
Cash dividends paid	(860		)	(722		)	(1,024		)	(860		)
Proceeds from common stock issuances	323			295			557			323
Repayments of long-term debt	(1,250		)	(1,100		)	—			(1,250		)
Proceeds from commercial paper, net	3,101			4,259
Proceeds from short-term borrowings, net							10,797			3,101
Customer funds administered	1,784			2,962			1,062			1,784
Other, net	(368		)	(622		)	(398		)	(368		)
Cash flows (used for) from financing activities	(272		)	2,422
Cash flows from (used for) financing activities							9,303			(272		)
Effect of exchange rate changes on cash and cash equivalents	(5		)	(12		)	(129		)	(5		)
Increase in cash and cash equivalents	1,541			6,262			10,584			1,541
Cash and cash equivalents, beginning of period	10,866			11,981			10,985			10,866
Cash and cash equivalents, end of period	$	12,407		$	18,243		$	21,569		$	12,407

See Notes to the Condensed Consolidated Financial Statements

UnitedHealth Group

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

1. Basis of Presentation

UnitedHealth Group Incorporated (individually and together with its subsidiaries, “UnitedHealth Group” and ~~the “Company”~~“the Company”) is a diversified health care company dedicated to helping people live healthier lives and helping make the health system work better for everyone.

Through its diversified family of businesses, the Company leverages core competencies in data and health information; advanced technology; and clinical expertise. These core competencies are deployed within two distinct, but strategically aligned, business platforms: health benefits operating under UnitedHealthcare and health services operating under Optum.

The Company has prepared the Condensed Consolidated Financial Statements according to U.S. Generally Accepted Accounting Principles (GAAP) and has included the accounts of UnitedHealth Group and its subsidiaries. The year-end condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. In accordance with the rules and regulations of the U.S. Securities and Exchange Commission (SEC), the Company has omitted certain footnote disclosures that would substantially duplicate the disclosures contained in its annual audited Consolidated Financial Statements. Therefore, these Condensed Consolidated Financial Statements should be read together with the Consolidated Financial Statements and the Notes included in Part II, Item 8, “Financial Statements and Supplementary Data” in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2018~~2019 as filed with the SEC ~~(2018~~(2019 10-K). The accompanying Condensed Consolidated Financial Statements include all normal recurring adjustments necessary to present the interim financial statements fairly.

Use of Estimates

These Condensed Consolidated Financial Statements include certain amounts based on the Company’s best estimates and judgments. The Company’s most significant estimates include medical costs payable and goodwill. Certain of these estimates require the application of complex assumptions and judgments, often because they involve matters that are inherently uncertain and will likely change in subsequent periods. The impact of any change in estimates is included in earnings in the period in which the estimate is adjusted.

Revenue from Products

For the quarter ended March 31, 2020, the Company recognized revenue and cost of products sold for retail pharmacy co-payments related to its OptumRx business. Revenue recognized in prior periods related to retail pharmacy transactions excludes the member’s applicable co-payment. There was no impact on earnings from operations, net earnings, earnings per share or total equity.

Recently Adopted Accounting Standards

In ~~February~~June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. ~~2016-02, “Leases~~2016-13, “Financial Instruments - Credit Losses (Topic ~~842)~~326)” ~~as modified by ASUs 2018-01, 2018-10, 2018-11, 2018-20~~(ASU 2016-13). ASU 2016-13 requires the use of the current expected credit loss impairment model to develop an estimate of expected credit losses for certain financial assets. ASU 2016-13 also requires expected credit losses on available-for-sale debt securities to be recognized through an allowance for credit losses and 2019-01 (collectively, ASU 2016-02). Under ASU 2016-02, an entity is required to recognize assets and liabilities for the rights and obligations created by leases on the entity’s balance sheet for both finance and operating leases.revises certain disclosure requirements. The Company adopted ASU ~~2016-02~~2016-13 on January 1, 2020 using a ~~cumulative-effect~~cumulative effect upon adoption approach as of January 1, 2019. Upon adoption, the Company recognized $3.3 billion of lease right-of-use (ROU) assets and liabilities for operating leases on its Condensed Consolidated Balance Sheet, of which, $668 million were classified as current liabilities.approach. The adoption of ASU ~~2016-02~~2016-13 was immaterial to the Company’s consolidated balance sheet, results of operations, equity and cash flows. ~~The~~

Under the current expected credit loss impairment model, the Company ~~has included the disclosures required~~evaluates an available-for-sale debt security for credit-related impairment by ~~ASU 2016-02 below and in~~ ~~Note 6, “Commitments and Contingencies”~~.

The Company leases facilities and equipment under long-term operating leases that are non-cancelable and expire on various dates. At the lease commencement date, lease ROU assets and lease liabilities are recognized based onconsidering the present value of expected cash flows relative to a security’s amortized cost, the ~~future minimum lease payments over~~extent to which fair value is less than amortized cost, the ~~lease term, which includes all fixed obligations arising from~~financial condition and near-term prospects of the ~~lease contract.~~issuer and specific events or circumstances that may influence the operations of the issuer. Credit-related impairments are recorded as an allowance, with an offset to investment and other income. Non-credit related impairments are recorded through other comprehensive income. If ~~an interest rate is not implicit in a lease,~~ the Company ~~utilizes its incremental borrowing rate for~~intends to sell an impaired security, or will likely be required to sell a ~~period that closely matches~~security before recovery of the ~~lease term.~~

~~The Company’s ROU assets are~~entire amortized cost, the entire impairment is included in ~~other assets, and lease liabilities are included in other current liabilities and other liabilities in the Company’s Condensed Consolidated Balance Sheet.~~net earnings.

The Company has determined that there have been no other recently adopted or issued accounting standards that had, or will have, a material impact on its Condensed Consolidated Financial Statements.

2. Investments

A summary of debt securities by major security type is as follows:



(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
March 31, 2020
Debt securities - available-for-sale:
U.S. government and agency obligations	$	3,146	$	183	$	(1	)	$	3,328
State and municipal obligations	5,724		214		(20		)	5,918
Corporate obligations	17,923		182		(411		)	17,694
U.S. agency mortgage-backed securities	6,508		260		—			6,768
Non-U.S. agency mortgage-backed securities	1,932		28		(36		)	1,924
Total debt securities - available-for-sale	35,233		867		(468		)	35,632
Debt securities - held-to-maturity:
U.S. government and agency obligations	410		9		—			419
State and municipal obligations	31		2		—			33
Corporate obligations	284		—		(1		)	283
Total debt securities - held-to-maturity	725		11		(1		)	735
Total debt securities	$	35,958	$	878	$	(469	)	$	36,367
December 31, 2019
Debt securities - available-for-sale:
U.S. government and agency obligations	$	3,502	$	55	$	(4	)	$	3,553
State and municipal obligations	5,680		251		(5		)	5,926
Corporate obligations	17,910		343		(11		)	18,242
U.S. agency mortgage-backed securities	6,425		109		(6		)	6,528
Non-U.S. agency mortgage-backed securities	1,811		37		(3		)	1,845
Total debt securities - available-for-sale	35,328		795		(29		)	36,094
Debt securities - held-to-maturity:
U.S. government and agency obligations	402		2		—			404
State and municipal obligations	32		2		—			34
Corporate obligations	538		—		(1		)	537
Total debt securities - held-to-maturity	972		4		(1		)	975
Total debt securities	$	36,300	$	799	$	(30	)	$	37,069

(in millions)
Amortized
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses

Fair
Value
March 31, 2019
Debt securities - available-for-sale:
U.S. government and agency obligations $ 3,610
$ 30
$ (19 ) $ 3,621
State and municipal obligations 6,566
150
(9 ) 6,707
Corporate obligations 15,589
95
(58 ) 15,626
U.S. agency mortgage-backed securities 5,212
37
(51 ) 5,198
Non-U.S. agency mortgage-backed securities 1,471
13
(6 ) 1,478
Total debt securities - available-for-sale 32,448
325
(143 ) 32,630
Debt securities - held-to-maturity:
U.S. government and agency obligations 265
—
(1 ) 264
State and municipal obligations 31
1
—
32
Corporate obligations 428
1
—
429
Total debt securities - held-to-maturity 724
2
(1 ) 725
Total debt securities $ 33,172
$ 327
$ (144 ) $ 33,355
December 31, 2018
Debt securities - available-for-sale:
U.S. government and agency obligations $ 3,434
$ 13
$ (42 ) $ 3,405
State and municipal obligations 7,117
61
(57 ) 7,121
Corporate obligations 15,366
14
(218 ) 15,162
U.S. agency mortgage-backed securities 4,947
11
(106 ) 4,852
Non-U.S. agency mortgage-backed securities 1,376
2
(20 ) 1,358
Total debt securities - available-for-sale 32,240
101
(443 ) 31,898
Debt securities - held-to-maturity:
U.S. government and agency obligations 255
1
(2 ) 254
State and municipal obligations 11
—
—
11
Corporate obligations 355
—
—
355
Total debt securities - held-to-maturity 621
1
(2 ) 620
Total debt securities $ 32,861
$ 102
$ (445 ) $ 32,518

The Company held $1.7 billion and $2.0 billion of equity securities as of March 31, ~~2019~~2020 and December 31, ~~2018.~~2019, respectively. The Company’s investments in equity securities primarily consist of employee savings plan related investments and shares of Brazilian real denominated fixed-income funds ~~and dividend paying stocks~~ with readily determinable fair values. Additionally, the Company’s investments included ~~$1.5~~$1.4 billion of equity method investments in operating businesses in the health care sector as of March 31, ~~2019~~2020 and December 31, ~~2018.~~2019. The allowance for credit losses on held-to-maturity securities at March 31, 2020 was not material.

The amortized cost and fair value of debt securities as of March 31, ~~2019,~~2020, by contractual maturity, were as follows:



	Available-for-Sale				Held-to-Maturity
(in millions)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	3,010	$	3,011	$	319	$	320
Due after one year through five years	11,565		11,604		352		359
Due after five years through ten years	8,563		8,669		28		28
Due after ten years	3,655		3,656		26		28
U.S. agency mortgage-backed securities	6,508		6,768		—		—
Non-U.S. agency mortgage-backed securities	1,932		1,924		—		—
Total debt securities	$	35,233	$	35,632	$	725	$	735

Available-for-Sale Held-to-Maturity
(in millions)
Amortized
Cost

Fair
Value
Amortized
Cost Fair
Value
Due in one year or less $ 3,457
$ 3,455
$ 132
$ 132
Due after one year through five years 12,283
12,304
318
318
Due after five years through ten years 7,314
7,430
131
131
Due after ten years 2,711
2,765
143
144
U.S. agency mortgage-backed securities 5,212
5,198
—
—
Non-U.S. agency mortgage-backed securities 1,471
1,478
—
—
Total debt securities $ 32,448
$ 32,630
$ 724
$ 725

The fair value of available-for-sale debt securities with gross unrealized losses by major security type and length of time that individual securities have been in a continuous unrealized loss position were as follows:



	Less Than 12 Months					12 Months or Greater					Total
(in millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
March 31, 2020
Debt securities - available-for-sale:
U.S. government and agency obligations	$	56	$	(1	)	$	—	$	—		$	56	$	(1	)
State and municipal obligations	810		(20		)	—		—			810		(20		)
Corporate obligations	9,294		(382		)	391		(29		)	9,685		(411		)
Non-U.S. agency mortgage-backed securities	841		(33		)	30		(3		)	871		(36		)
Total debt securities - available-for-sale	$	11,001	$	(436	)	$	421	$	(32	)	$	11,422	$	(468	)
December 31, 2019
Debt securities - available-for-sale:
U.S. government and agency obligations	$	616	$	(4	)	$	—	$	—		$	616	$	(4	)
State and municipal obligations	440		(5		)	—		—			440		(5		)
Corporate obligations	1,903		(7		)	740		(4		)	2,643		(11		)
U.S. agency mortgage-backed securities	657		(3		)	333		(3		)	990		(6		)
Non-U.S. agency mortgage-backed securities	406		(3		)	—		—			406		(3		)
Total debt securities - available-for-sale	$	4,022	$	(22	)	$	1,073	$	(7	)	$	5,095	$	(29	)

Less Than 12 Months 12 Months or Greater Total
(in millions)
Fair
Value

Gross
Unrealized
Losses

Fair
Value
Gross
Unrealized
Losses
Fair
Value
Gross
Unrealized
Losses
March 31, 2019
Debt securities - available-for-sale:
U.S. government and agency obligations $ —
$ —
$ 1,329
$ (19 ) $ 1,329
$ (19 )
State and municipal obligations —
—
1,274
(9 ) 1,274
(9 )
Corporate obligations 1,461
(7 ) 5,479
(51 ) 6,940
(58 )
U.S. agency mortgage-backed securities —
—
2,979
(51 ) 2,979
(51 )
Non-U.S. agency mortgage-backed securities —
—
546
(6 ) 546
(6 )
Total debt securities - available-for-sale $ 1,461
$ (7 ) $ 11,607
$ (136 ) $ 13,068
$ (143 )
December 31, 2018
Debt securities - available-for-sale:
U.S. government and agency obligations $ 998
$ (7 ) $ 1,425
$ (35 ) $ 2,423
$ (42 )
State and municipal obligations 1,334
(11 ) 2,491
(46 ) 3,825
(57 )
Corporate obligations 8,105
(109 ) 4,239
(109 ) 12,344
(218 )
U.S. agency mortgage-backed securities 1,296
(22 ) 2,388
(84 ) 3,684
(106 )
Non-U.S. agency mortgage-backed securities 622
(7 ) 459
(13 ) 1,081
(20 )
Total debt securities - available-for-sale $ 12,355
$ (156 ) $ 11,002
$ (287 ) $ 23,357
$ (443 )

The Company’s unrealized losses from debt securities as of March 31, ~~2019~~2020 were generated from ~~11,000~~approximately 10,000 positions out of a total of ~~30,000~~32,000 positions. The Company believes that it will collect the timely principal and interest due on its debt securities that have an amortized cost in excess of fair value. The unrealized losses were primarily caused by interest rate increases and not by unfavorable changes in the credit quality associated with these ~~securities.~~securities that impacted our assessment on collectability of principal and interest. At each reporting period, the Company evaluates available-for-sale debt securities for any credit-related impairment when the fair value of the investment is less than its amortized cost. The Company evaluated the expected cash flows, the underlying credit quality and credit ratings of the issuers, and the potential economic impacts of COVID-19 on the issuers, noting no significant credit deterioration since purchase. As of March 31, ~~2019,~~2020, the Company did not have the intent to sell any of the available-for-sale debt securities in an unrealized loss position. Therefore, the Company believes these losses to be temporary. The allowance for credit losses on available-for-sale debt securities at March 31, 2020 was not material.

3. Fair Value

Certain assets and liabilities are measured at fair value in the Condensed Consolidated Financial Statements or have fair values disclosed in the Notes to the Condensed Consolidated Financial Statements. These assets and liabilities are classified into one of three levels of a hierarchy defined by GAAP.

For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see Note 4 of Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data” in the ~~2018~~2019 10-K.

The following table presents a summary of fair value measurements by level and carrying values for items measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:



(in millions)	Quoted Prices in Active Markets (Level 1)			Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)			Total Fair and Carrying Value
March 31, 2020
Cash and cash equivalents	$	21,450		$	119		$	—		$	21,569
Debt securities - available-for-sale:
U.S. government and agency obligations	3,143			185			—			3,328
State and municipal obligations	—			5,918			—			5,918
Corporate obligations	59			17,385			250			17,694
U.S. agency mortgage-backed securities	—			6,768			—			6,768
Non-U.S. agency mortgage-backed securities	—			1,924			—			1,924
Total debt securities - available-for-sale	3,202			32,180			250			35,632
Equity securities	1,394			19			—			1,413
Assets under management	937			1,890			39			2,866
Total assets at fair value	$	26,983		$	34,208		$	289		$	61,480
Percentage of total assets at fair value	44		%	56		%	—		%	100		%
December 31, 2019
Cash and cash equivalents	$	10,837		$	148		$	—		$	10,985
Debt securities - available-for-sale:
U.S. government and agency obligations	3,369			184			—			3,553
State and municipal obligations	—			5,926			—			5,926
Corporate obligations	70			17,923			249			18,242
U.S. agency mortgage-backed securities	—			6,528			—			6,528
Non-U.S. agency mortgage-backed securities	—			1,845			—			1,845
Total debt securities - available-for-sale	3,439			32,406			249			36,094
Equity securities	1,734			22			—			1,756
Assets under management	1,123			1,918			35			3,076
Total assets at fair value	$	17,133		$	34,494		$	284		$	51,911
Percentage of total assets at fair value	33		%	66		%	1		%	100		%

(in millions)
Quoted Prices
in Active
Markets
(Level 1)

Other
Observable
Inputs
(Level 2)

Unobservable
Inputs
(Level 3)

Total
Fair and Carrying
Value
March 31, 2019
Cash and cash equivalents $ 12,283
$ 124
$ —
$ 12,407
Debt securities - available-for-sale:
U.S. government and agency obligations 3,319
302
—
3,621
State and municipal obligations —
6,707
—
6,707
Corporate obligations 17
15,424
185
15,626
U.S. agency mortgage-backed securities —
5,198
—
5,198
Non-U.S. agency mortgage-backed securities —
1,478
—
1,478
Total debt securities - available-for-sale 3,336
29,109
185
32,630
Equity securities 1,827
12
—
1,839
Assets under management 896
2,043
12
2,951
Total assets at fair value
$ 18,342
$ 31,288
$ 197
$ 49,827
Percentage of total assets at fair value 37 % 63 % — % 100 %
December 31, 2018
Cash and cash equivalents $ 10,757
$ 109
$ —
$ 10,866
Debt securities - available-for-sale:
U.S. government and agency obligations 3,060
345
—
3,405
State and municipal obligations —
7,121
—
7,121
Corporate obligations 39
14,950
173
15,162
U.S. agency mortgage-backed securities —
4,852
—
4,852
Non-U.S. agency mortgage-backed securities —
1,358
—
1,358
Total debt securities - available-for-sale 3,099
28,626
173
31,898
Equity securities 1,832
13
—
1,845
Assets under management 1,086
1,938
8
3,032
Total assets at fair value $ 16,774
$ 30,686
$ 181
$ 47,641
Percentage of total assets at fair value 35 % 65 % — % 100 %

There were no transfers in or out of Level 3 financial assets or liabilities during the three months ended March 31, ~~2019~~2020 or ~~2018.~~2019.

The following table presents a summary of fair value measurements by level and carrying values for certain financial instruments not measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:



(in millions)	Quoted Prices in Active Markets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total Fair Value		Total Carrying Value
March 31, 2020
Debt securities - held-to-maturity	$	556	$	91	$	88	$	735	$	725
Long-term debt and other financing obligations	$	—	$	45,272	$	—	$	45,272	$	40,394
December 31, 2019
Debt securities - held-to-maturity	$	541	$	181	$	253	$	975	$	972
Long-term debt and other financing obligations	$	—	$	45,078	$	—	$	45,078	$	40,278

(in millions)
Quoted Prices
in Active
Markets
(Level 1)

Other
Observable
Inputs
(Level 2)

Unobservable
Inputs
(Level 3)

Total
Fair
Value
Total Carrying Value
March 31, 2019
Debt securities - held-to-maturity $ 273
$ 172
$ 280
$ 725
$ 724
Long-term debt and other financing obligations —
37,790
—
37,790
35,221
December 31, 2018
Debt securities - held-to-maturity $ 260
$ 65
$ 295
$ 620
$ 621
Long-term debt and other financing obligations $ —
$ 37,944
$ —
$ 37,944
$ 36,554

Nonfinancial assets and liabilities or financial assets and liabilities that are measured at fair value on a nonrecurring basis are subject to fair value adjustments only in certain circumstances, such as when the Company records an impairment. There were no significant fair value adjustments for these assets and liabilities recorded during either the three months ended March 31, ~~2019~~2020 or ~~2018~~2019.

4. Medical Costs Payable

The following table shows the components of the change in medical costs payable for the three months ended March 31:



(in millions)	2020			2019
Medical costs payable, beginning of period	$	21,690		$	19,891
Acquisitions	—			35
Reported medical costs:
Current year	41,580			39,239
Prior years	(580		)	(300		)
Total reported medical costs	41,000			38,939
Medical payments:
Payments for current year	(23,471		)	(22,973		)
Payments for prior years	(16,447		)	(14,753		)
Total medical payments	(39,918		)	(37,726		)
Medical costs payable, end of period	$	22,772		$	21,139

(in millions) 2019 2018
Medical costs payable, beginning of period $ 19,891
$ 17,871
Acquisitions 35
211
Reported medical costs:
Current year 39,239
36,153
Prior years (300 ) (290 )
Total reported medical costs 38,939
35,863
Medical payments:
Payments for current year (22,973 ) (21,237 )
Payments for prior years (14,753 ) (13,119 )
Total medical payments (37,726 ) (34,356 )
Medical costs payable, end of period $ 21,139
$ 19,589

For the three months ended March 31, 2020, prior years medical cost reserve development was primarily driven by lower than expected health system utilization. For the three months ended March 31, 2019, ~~and 2018,~~ the prior years medical cost reserve development included no individual factors that were significant. Medical costs payable included reserves for claims incurred by insured customers but not yet reported to the Company of $14.3 billion and ~~$13.2~~$13.8 billion at March 31, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively.

5. ~~Commercial Paper~~Short-Term Borrowings and Long-Term Debt

~~Commercial paper~~Short-term borrowings and senior unsecured long-term debt consisted of the following:



	March 31, 2020						December 31, 2019
(in millions, except percentages)	Par Value		Carrying Value		Fair Value		Par Value		Carrying Value		Fair Value
Commercial paper	$	1,214	$	1,213	$	1,213	$	400	$	400	$	400
Bank credit facilities	10,000		10,000		10,000		—		—		—
2.700% notes due July 2020	1,500		1,500		1,500		1,500		1,499		1,506
Floating rate notes due October 2020	300		300		296		300		300		300
3.875% notes due October 2020	450		452		452		450		450		455
1.950% notes due October 2020	900		899		900		900		899		900
4.700% notes due February 2021	400		406		407		400		403		410
2.125% notes due March 2021	750		749		750		750		749		753
Floating rate notes due June 2021	350		349		347		350		349		350
3.150% notes due June 2021	400		399		406		400		399		407
3.375% notes due November 2021	500		510		512		500		501		512
2.875% notes due December 2021	750		768		764		750		753		765
2.875% notes due March 2022	1,100		1,114		1,130		1,100		1,087		1,121
3.350% notes due July 2022	1,000		998		1,034		1,000		998		1,036
2.375% notes due October 2022	900		896		912		900		896		911
0.000% notes due November 2022	15		13		14		15		13		14
2.750% notes due February 2023	625		646		640		625		624		638
2.875% notes due March 2023	750		797		777		750		770		770
3.500% notes due June 2023	750		747		788		750		747		786
3.500% notes due February 2024	750		746		794		750		746		792
2.375% notes due August 2024	750		747		767		750		747		760
3.750% notes due July 2025	2,000		1,991		2,161		2,000		1,990		2,161
3.700% notes due December 2025	300		298		323		300		298		325
3.100% notes due March 2026	1,000		996		1,056		1,000		996		1,048
3.450% notes due January 2027	750		746		804		750		746		804
3.375% notes due April 2027	625		620		668		625		620		667
2.950% notes due October 2027	950		939		992		950		939		988
3.850% notes due June 2028	1,150		1,143		1,281		1,150		1,142		1,269
3.875% notes due December 2028	850		843		953		850		843		941
2.875% notes due August 2029	1,000		1,104		1,047		1,000		993		1,029
4.625% notes due July 2035	1,000		992		1,190		1,000		992		1,215
5.800% notes due March 2036	850		838		1,107		850		838		1,129
6.500% notes due June 2037	500		492		691		500		492		712
6.625% notes due November 2037	650		641		910		650		641		940
6.875% notes due February 2038	1,100		1,077		1,613		1,100		1,076		1,631
3.500% notes due August 2039	1,250		1,241		1,348		1,250		1,241		1,313
5.700% notes due October 2040	300		296		405		300		296		396
5.950% notes due February 2041	350		345		484		350		345		475
4.625% notes due November 2041	600		589		742		600		589		716
4.375% notes due March 2042	502		484		601		502		484		580
3.950% notes due October 2042	625		608		711		625		607		688
4.250% notes due March 2043	750		735		885		750		735		856
4.750% notes due July 2045	2,000		1,973		2,547		2,000		1,973		2,463
4.200% notes due January 2047	750		738		881		750		738		861
4.250% notes due April 2047	725		717		853		725		717		839
3.750% notes due October 2047	950		934		1,050		950		934		1,023
4.250% notes due June 2048	1,350		1,330		1,592		1,350		1,330		1,569
4.450% notes due December 2048	1,100		1,086		1,333		1,100		1,086		1,316
3.700% notes due August 2049	1,250		1,235		1,385		1,250		1,235		1,344
3.875% notes due August 2059	1,250		1,229		1,372		1,250		1,228		1,350
Total short-term borrowings and long-term debt	$	50,631	$	50,509	$	55,388	$	39,817	$	39,474	$	44,234

March 31, 2019 December 31, 2018
(in millions, except percentages)
Par
Value

Carrying
Value

Fair
Value

Par
Value

Carrying
Value

Fair
Value
Commercial paper $ 3,134
$ 3,117
$ 3,117
$ —
$ —
$ —
1.700% notes due February 2019 —
—
—
750
750
749
1.625% notes due March 2019 —
—
—
500
500
499
2.300% notes due December 2019 500
496
499
500
494
497
2.700% notes due July 2020 1,500
1,498
1,503
1,500
1,498
1,494
Floating rate notes due October 2020 300
299
300
300
299
298
3.875% notes due October 2020 450
445
457
450
443
456
1.950% notes due October 2020 900
897
890
900
897
884
4.700% notes due February 2021 400
400
413
400
398
412
2.125% notes due March 2021 750
748
744
750
747
734
Floating rate notes due June 2021 350
349
350
350
349
347
3.150% notes due June 2021 400
399
404
400
399
400
3.375% notes due November 2021 500
493
508
500
489
503
2.875% notes due December 2021 750
742
754
750
735
748
2.875% notes due March 2022 1,100
1,063
1,107
1,100
1,051
1,091
3.350% notes due July 2022 1,000
997
1,022
1,000
997
1,005
2.375% notes due October 2022 900
895
891
900
894
872
0.000% notes due November 2022 15
12
13
15
12
13
2.750% notes due February 2023 625
610
625
625
602
611
2.875% notes due March 2023 750
758
754
750
750
739
3.500% notes due June 2023 750
747
773
750
746
756
3.500% notes due February 2024 750
745
772
750
745
755
3.750% notes due July 2025 2,000
1,989
2,088
2,000
1,989
2,025
3.700% notes due December 2025 300
298
312
300
298
303
3.100% notes due March 2026 1,000
996
999
1,000
995
965
3.450% notes due January 2027 750
746
763
750
746
742
3.375% notes due April 2027 625
619
633
625
619
611
2.950% notes due October 2027 950
938
933
950
938
898
3.850% notes due June 2028 1,150
1,142
1,204
1,150
1,142
1,163
3.875% notes due December 2028 850
842
890
850
842
861
4.625% notes due July 2035 1,000
992
1,121
1,000
992
1,060
5.800% notes due March 2036 850
838
1,045
850
838
1,003
6.500% notes due June 2037 500
492
661
500
492
638
6.625% notes due November 2037 650
641
874
650
641
841
6.875% notes due February 2038 1,100
1,076
1,514
1,100
1,076
1,437
5.700% notes due October 2040 300
296
370
300
296
355
5.950% notes due February 2041 350
345
446
350
345
426
4.625% notes due November 2041 600
588
657
600
588
627
4.375% notes due March 2042 502
484
534
502
484
503
3.950% notes due October 2042 625
607
631
625
607
596
4.250% notes due March 2043 750
735
787
750
734
744
4.750% notes due July 2045 2,000
1,973
2,260
2,000
1,973
2,116
4.200% notes due January 2047 750
738
777
750
738
745
4.250% notes due April 2047 725
717
759
725
717
719
3.750% notes due October 2047 950
933
923
950
933
869
4.250% notes due June 2048 1,350
1,329
1,420
1,350
1,329
1,349
4.450% notes due December 2048 1,100
1,087
1,191
1,100
1,087
1,132
Total commercial paper and long-term debt $ 37,551
$ 37,151
$ 39,688
$ 35,667
$ 35,234
$ 36,591

The Company’s long-term debt obligations also included ~~$1.2~~$1.1 billion and ~~$1.3~~$1.2 billion of other financing obligations, of which ~~$306~~$309 million and ~~$229~~$322 million were classified as current as of March 31, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively.

Commercial Paper and Bank Credit Facilities

Commercial paper consists of short-duration, senior unsecured debt privately placed on a discount basis through broker-dealers. As of March 31, ~~2019,~~2020, the Company’s outstanding commercial paper had a weighted average annual interest rate of ~~2.7%~~2.4%.

The Company has ~~$3.5~~$4.4 billion five-year, ~~$3.5~~$4.4 billion three-year and ~~$3.0~~$3.8 billion 364-day revolving bank credit facilities with 2625 banks, which mature in December ~~2023,~~2024, December ~~2021~~2022 and December ~~2019,~~2020, respectively. These facilities provide liquidity support for the Company’s commercial paper program and are available for general corporate purposes. ~~As of March 31, 2019, no amounts had been drawn on any of the bank credit facilities.~~ The annual interest rates, which are variable based on term, are calculated based on the London Interbank Offered Rate (LIBOR) plus a credit spread based on the Company’s senior unsecured credit ratings. ~~If amounts~~As of March 31, 2020, the Company had ~~been~~ drawn $1.8 billion, $4.4 billion and $3.8 billion at annual interest rates of 1.6%, 1.6% and 1.7% on ~~the~~its $4.4 billion five-year, $4.4 billion three-year and $3.8 billion 364-day revolving bank credit facilities, ~~as of March 31, 2019, annual interest rates would have ranged from 3.2% to 3.4%.~~respectively.

Debt Covenants

The Company’s bank credit facilities contain various covenants, including covenants requiring the Company to maintain adefined debt to debt-plus-shareholders’ equity ratio of not more than 60%. The Company was in compliance with its debt covenants as of March 31, ~~2019.~~2020.

6. Commitments and Contingencies

~~Leases~~

Operating lease costs were $238 million for the three months ended March 31, 2019 and included immaterial variable and short-term lease costs. Cash payments made on the Company’s operating lease liabilities were $181 million for the three months ended March 31, 2019, which were classified within operating activities in the Condensed Consolidated Statements of Cash Flows. As of March 31, 2019, the Company’s weighted-average remaining lease term and weighted-average discount rate for its operating leases were 8.5 years and 4.2%, respectively.

~~As of March 31, 2019, future minimum annual lease payments under all non-cancelable operating leases were as follows:~~

(in millions) Future Operating Lease Payments
2019 480
2020 667
2021 578
2022 481
2023 393
Thereafter 1,553
Total future minimum lease payments 4,152
Less imputed interest (731 )
Total 3,421

Legal Matters

Because of the nature of its businesses, the Company is frequently made party to a variety of legal actions and regulatory inquiries, including class actions and suits brought by members, care providers, consumer advocacy organizations, customers and regulators, relating to the Company’s businesses, including management and administration of health benefit plans and other services. These matters include medical malpractice, employment, intellectual property, antitrust, privacy and contract claims and claims related to health care benefits coverage and other business practices.

The Company records liabilities for its estimates of probable costs resulting from these matters where appropriate. Estimates of costs resulting from legal and regulatory matters involving the Company are inherently difficult to predict, particularly where the matters: involve indeterminate claims for monetary damages or may involve fines, penalties or punitive damages; present novel legal theories or represent a shift in regulatory policy; involve a large number of claimants or regulatory bodies; are in the early stages of the proceedings; or could result in a change in business practices. Accordingly, the Company is often unable to

estimate the losses or ranges of losses for those matters where there is a reasonable possibility or it is probable that a loss may be incurred.

Government Investigations, Audits and Reviews

The Company has been involved or is currently involved in various governmental investigations, audits and reviews. These include routine, regular and special investigations, audits and reviews by the Centers for Medicare and Medicaid Services (CMS), state insurance and health and welfare departments, ~~the Brazilian national regulatory agency for private health insurance and plans (the Agência Nacional de Saúde Suplementar),~~ state attorneys general, the Office of the Inspector General, the Office of Personnel Management, the Office of Civil Rights, the Government Accountability Office, the Federal Trade Commission, U.S. Congressional committees, the U.S. Department of Justice, the SEC, the Internal Revenue Service, the U.S. Drug Enforcement Administration, the ~~Brazilian federal revenue service (the Secretaria da Receita Federal), the~~ U.S. Department of Labor, the Federal Deposit Insurance Corporation, the Defense Contract Audit Agency and other governmental authorities. Similarly, our international businesses are also subject to investigations, audits and reviews by applicable foreign governments, including South American and other non-U.S. governmental authorities. Certain of the Company’s businesses have been reviewed or are currently under review, including for, among other matters, compliance with coding and other requirements under the Medicare risk-adjustment model. CMS has selected certain of the Company’s local plans for risk adjustment data validation (RADV) audits to validate the coding practices of and supporting documentation maintained by health care providers and such audits may result in retrospective adjustments to payments made to the Company’s health plans.

On February 14, 2017, the Department of Justice (DOJ) announced its decision to pursue certain claims within a lawsuit initially asserted against the Company and filed under seal by a whistleblower in 2011. The whistleblower’s complaint, which was unsealed on February 15, 2017, alleges that the Company made improper risk adjustment submissions and violated the False Claims Act. On February 12, 2018, the court granted in part and denied in part the Company’s motion to dismiss. In May 2018, DOJ moved to dismiss the Company’s counterclaims, which were filed in March 2018, and moved for partial summary judgment. In March 2019, the court denied the government’s motion for partial summary judgment and dismissed the

Company’s counterclaims without prejudice. The Company cannot reasonably estimate the outcome that may result from this matter given its procedural status.

7. Segment Financial Information

The Company’s ~~four~~4 reportable segments are UnitedHealthcare, OptumHealth, OptumInsight and OptumRx. For more information on the Company’s segments see Part I, Item I, “Business” and Note 1314 of Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data” in the ~~2018~~2019 10-K.

The following tables present reportable segment financial information:


			Optum																			Optum
(in millions)	UnitedHealthcare		OptumHealth		OptumInsight		OptumRx		Optum Eliminations			Optum		Corporate and Eliminations			Consolidated			UnitedHealthcare		OptumHealth		OptumInsight		OptumRx		Optum Eliminations			Optum		Corporate and Eliminations			Consolidated
Three Months Ended March 31, 2020
Revenues - unaffiliated customers:
Premiums																				$	48,593	$	2,047	$	—	$	—	$	—		$	2,047	$	—		$	50,640
Products																				—		9		29		8,393		—			8,431		—			8,431
Services																				2,278		1,548		891		268		—			2,707		—			4,985
Total revenues - unaffiliated customers																				50,871		3,604		920		8,661		—			13,185		—			64,056
Total revenues - affiliated customers																				—		5,452		1,562		12,876		(404		)	19,486		(19,486		)	—
Investment and other income																				197		136		12		20		—			168		—			365
Total revenues																				$	51,068	$	9,192	$	2,494	$	21,557	$	(404	)	$	32,839	$	(19,486	)	$	64,421
Earnings from operations																				$	2,888	$	712	$	536	$	860	$	—		$	2,108	$	—		$	4,996
Interest expense																				—		—		—		—		—			—		(437		)	(437		)
Earnings before income taxes																				$	2,888	$	712	$	536	$	860	$	—		$	2,108	$	(437	)	$	4,559
Three Months Ended March 31, 2019
Revenues - unaffiliated customers:
Premiums	$	46,501	$	1,012	$	—	$	—	$	—		$	1,012	$	—		$	47,513		$	46,501	$	1,012	$	—	$	—	$	—		$	1,012	$	—		$	47,513
Products	—		8		23		8,041		—			8,072		—			8,072			—		8		23		8,041		—			8,072		—			8,072
Services	2,141		1,274		754		149		—			2,177		—			4,318			2,141		1,274		754		149		—			2,177		—			4,318
Total revenues - unaffiliated customers	48,642		2,294		777		8,190		—			11,261		—			59,903			48,642		2,294		777		8,190		—			11,261		—			59,903
Total revenues - affiliated customers	—		4,287		1,407		9,613		(359		)	14,948		(14,948		)	—			—		4,287		1,407		9,613		(359		)	14,948		(14,948		)	—
Investment and other income	254		132		5		14		—			151		—			405			254		132		5		14		—			151		—			405
Total revenues	$	48,896	$	6,713	$	2,189	$	17,817	$	(359	)	$	26,360	$	(14,948	)	$	60,308		$	48,896	$	6,713	$	2,189	$	17,817	$	(359	)	$	26,360	$	(14,948	)	$	60,308
Earnings from operations	$	2,954	$	626	$	432	$	820	$	—		$	1,878	$	—		$	4,832		$	2,954	$	626	$	432	$	820	$	—		$	1,878	$	—		$	4,832
Interest expense	—		—		—		—		—			—		(400		)	(400		)	—		—		—		—		—			—		(400		)	(400		)
Earnings before income taxes	$	2,954	$	626	$	432	$	820	$	—		$	1,878	$	(400	)	$	4,432		$	2,954	$	626	$	432	$	820	$	—		$	1,878	$	(400	)	$	4,432
Three Months Ended March 31, 2018
Revenues - unaffiliated customers:
Premiums	$	43,237	$	847	$	—	$	—	$	—		$	847	$	—		$	44,084
Products	—		12		23		6,667		—			6,702		—			6,702
Services	2,039		1,188		740		137		—			2,065		—			4,104
Total revenues - unaffiliated customers	45,276		2,047		763		6,804		—			9,614		—			54,890
Total revenues - affiliated customers	—		3,606		1,304		9,295		(333		)	13,872		(13,872		)	—
Investment and other income	183		106		2		7		—			115		—			298
Total revenues	$	45,459	$	5,759	$	2,069	$	16,106	$	(333	)	$	23,601	$	(13,872	)	$	55,188
Earnings from operations	$	2,400	$	488	$	395	$	770	$	—		$	1,653	$	—		$	4,053
Interest expense	—		—		—		—		—			—		(329		)	(329		)
Earnings before income taxes	$	2,400	$	488	$	395	$	770	$	—		$	1,653	$	(329	)	$	3,724


ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read together with the accompanying Condensed Consolidated Financial Statements and Notes and with our ~~2018~~2019 10-K, including the Consolidated Financial Statements and Notes in Part II, Item 8, “Financial Statements and Supplementary Data” in that report. Unless the context indicates otherwise, references to the terms “UnitedHealth Group,” “we,” “our” or “us” used throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations refer to UnitedHealth Group Incorporated and its consolidated subsidiaries.

Readers are cautioned that the statements, estimates, projections or outlook contained in this Management's Discussion and Analysis of Financial Condition and Results of Operations, including discussions regarding financial prospects, economic conditions, trends and uncertainties contained in this Item 2, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). These forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the results discussed or implied in the forward-looking statements. A description of some of the risks and uncertainties is set forth in Part I, Item 1A, “Risk Factors” in our ~~2018~~2019 10-K and in the discussion below.

EXECUTIVE OVERVIEW

General

UnitedHealth Group is a diversified health care company dedicated to helping people live healthier lives and helping make the health system work better for everyone. Through our diversified family of businesses, we leverage core competencies in data and health ~~information;~~information, advanced ~~technology;~~technology, and clinical ~~expertise.~~expertise, focused on improving health outcomes, lowering health care costs and creating a better experience for patients, their caregivers and physicians. These core competencies are deployed within our two

distinct, but strategically aligned, business platforms: health benefits operating under UnitedHealthcare and health services operating under Optum.

Further information on our business is presented in Part I, Item 1, “Business” and Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our ~~2018~~2019 10-K and additional information on our segments can be found in this Item 2 and in Note 7 of Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this report.

COVID-19 Trends and Uncertainties

The COVID-19 pandemic is rapidly evolving and the ultimate impact on our business, results of operations, financial condition and cash flows is uncertain and difficult to predict. For additional information regarding risks and uncertainties relating to COVID-19, see “Risk Factors” in Part II, Item 1A of this report. Specific trends and uncertainties related to our two business platforms are as follows:

UnitedHealthcare.We have expanded benefit coverage in areas such as COVID-19 testing and treatment, telemedicine, and pharmacy benefits; offered additional enrollment opportunities to those who previously declined employer-sponsored offerings; extended certain premium payment terms for customers experiencing financial hardship; simplified administrative practices; and began accelerating payments to care providers, all with the aim of assisting our customers, providers and members in addressing the COVID-19 crisis. Potential economic costs, including cost of care and loss of commercial membership due to higher rates of unemployment, may initially be more than offset by temporary deferrals of elective care and increased membership in Medicaid and individual programs. Following the crisis, consumer demand for care is expected to return, resulting in potentially increased future medical costs. Depending on the pacing and intensity of the virus, as well as the duration of policies and initiatives to address COVID-19, such as stay-at-home and social distancing guidelines,the ultimate impact is uncertain.

Optum. The reduction of elective and routine procedures also impacts the Optum business. For example, most traditional procedure work at our ambulatory surgery centers has been postponed, while our capitated care delivery businesses have experienced lower care demand. COVID-19 will also continue to influence customer and consumer behavior, both during and after the pandemic, which could impact how care is delivered and the manner in which consumers wish to receive their prescription drugs or infusion services. The impact of COVID-19 on our care provider and payer clients could impact the volume and types of services that Optum provides, as well as the pacing of potential new business opportunities. As a result of the dynamic situation and broad-reaching impact to the health system, the ultimate impact of COVID-19 is uncertain.

Business Trends

Our businesses participate in the United States, South American and certain other international health markets. ~~In the United States, health care spending has grown consistently for many years and comprises approximately 18% of gross domestic product. We expect overall~~Overall spending on health care ~~to continue to grow in the future due to inflation,~~is impacted by inflation; utilization; medical technology and pharmaceutical ~~advancement,~~advancement; regulatory ~~requirements,~~requirements; demographic trends in the population and national interest in health and well-being. The rate of market growth may be affected by a variety of factors, including macro-economic conditions, such as the economic impact of COVID-19, and regulatory changes, which ~~have impacted and~~ could ~~further~~ impact our results of ~~operations.~~operations, including our continued efforts to control health care costs.

Pricing Trends. To price our health care benefit products, we start with our view of expected future costs, including any impact from the Health Insurance ~~Industry~~ Tax. We frequently evaluate and adjust our approach in each of the local markets we serve, considering all relevant factors, such as product positioning, price competitiveness and environmental, competitive, legislative and regulatory considerations, including minimum medical loss ratio (MLR) thresholds. We will continue seeking to balance growth and profitability across all of these dimensions.

The commercial risk market remains highly competitive in both the small group and large group segments. We expect broad-based competition to continue as the industry adapts to individual and employer needs amid reform changes. Pricing for contracts that cover some portion of calendar year ~~2020~~2021 will reflect the ~~return~~permanent repeal of the Health Insurance ~~Industry Tax after a moratorium in 2019.~~Tax.

Government programs in the public and senior sector tend to receive lower rates of increase than the commercial market due to governmental budget pressures and lower cost trends.

Medical Cost Trends. Our medical cost trends primarily relate to changes in unit costs, health system utilization and prescription drug costs. We endeavor to mitigate those increases by engaging physicians and consumers with information and helping them make clinically sound choices, with the objective of helping them achieve high quality, affordable care. The uncertain impact of COVID-19 may impact our ability to estimate medical costs payable, which could result in increased variability to medical cost reserve development in future periods.

Regulatory Trends and Uncertainties

Following is a summary of management’s view of regulatory trends and uncertainties. For additional information regarding regulatory trends and uncertainties, see Part I, Item 1 “Business - Government Regulation,” Part 1, Item 1A, “Risk ~~Factors” and~~Factors,” Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our ~~2018 10-K.~~2019 10-K and “Risk Factors” in Part II, Item 1A of this report.

Medicare Advantage Rates. Final ~~2020~~2021 Medicare Advantage rates resulted in an increase in industry base rates of approximately ~~2.5%~~1.7%, short of the industry forward medical cost trend, ~~including the return of the Health Insurance Industry Tax,~~ creating continued pressure in the Medicare Advantage program.

~~Health Insurance Industry~~Affordable Care Act (ACA) Tax. ~~There is~~After a ~~one year~~ moratorium onin 2019, the industry-wide amount of the Health Insurance ~~Industry~~ Tax ~~in 2019. This moratorium~~for 2020, which is primarily borne by customers, is $15.5 billion, with our portion being approximately $3.0 billion. The return of the tax impacts year-over-year comparability of our financial statements, including revenues, operating costs, medical care ratio (MCR), operating cost ratio, effective tax rate and cash flows from operations. The ACA Tax was permanently repealed by Congress, effective January 1, 2021.

SELECTED OPERATING PERFORMANCE AND OTHER SIGNIFICANT ITEMS

The following summarizes select first quarter ~~2019~~2020 year-over-year operating comparisons to first quarter ~~2018.~~2019.

Consolidated revenues grew 9%7%, UnitedHealthcare revenues grew 8%4% and Optum revenues grew ~~12%~~25%.

UnitedHealthcare served ~~880,000 additional~~670,000 fewer people domestically primarily asdue to expected attrition in commercial group and the proactive withdrawal from a ~~result of business combinations and growth in services to self-funded employers and seniors.~~Medicaid market.

~~Earnings~~Consolidated earnings from operations increased ~~19%~~3%, including ~~increases~~a decrease of ~~23%~~2% at UnitedHealthcare and ~~14%~~an increase of 12% at Optum.

Diluted earnings per common share ~~increased 24%.~~decreased 1% to $3.52.

Cash flows from operations for the three months ended March 31, 2020 were ~~$3.2~~$2.9 billion.

Return on ~~Equity~~equity was ~~26.8%~~23.6%.

RESULTS SUMMARY

The following table summarizes our consolidated results of operations and other financial information:



(in millions, except percentages and per share data)	Three Months Ended March 31,						Increase/(Decrease)
(in millions, except percentages and per share data)	2020			2019			2020 vs. 2019
Revenues:
Premiums	$	50,640		$	47,513		$	3,127		7	%
Products	8,431			8,072			359			4
Services	4,985			4,318			667			15
Investment and other income	365			405			(40		)	(10	)
Total revenues	64,421			60,308			4,113			7
Operating costs:
Medical costs	41,000			38,939			2,061			5
Operating costs	10,015			8,517			1,498			18
Cost of products sold	7,687			7,381			306			4
Depreciation and amortization	723			639			84			13
Total operating costs	59,425			55,476			3,949			7
Earnings from operations	4,996			4,832			164			3
Interest expense	(437		)	(400		)	(37		)	9
Earnings before income taxes	4,559			4,432			127			3
Provision for income taxes	(1,094		)	(875		)	(219		)	25
Net earnings	3,465			3,557			(92		)	(3	)
Earnings attributable to noncontrolling interests	(83		)	(90		)	7			(8	)
Net earnings attributable to UnitedHealth Group common shareholders	$	3,382		$	3,467		$	(85	)	(2	)%
Diluted earnings per share attributable to UnitedHealth Group common shareholders	$	3.52		$	3.56		$	(0.04	)	(1	)%
Medical care ratio (a)	81.0		%	82.0		%	(1.0		)%
Operating cost ratio	15.5			14.1			1.4
Operating margin	7.8			8.0			(0.2		)
Tax rate	24.0			19.7			4.3
Net earnings margin (b)	5.2			5.7			(0.5		)
Return on equity (c)	23.6		%	26.8		%	(3.2		)%

(in millions, except percentages and per share data) Three Months Ended March 31, Increase/(Decrease)
2019 2018 2019 vs. 2018
Revenues:
Premiums $ 47,513
$ 44,084
$ 3,429
8 %
Products 8,072
6,702
1,370
20
Services 4,318
4,104
214
5
Investment and other income 405
298
107
36
Total revenues 60,308
55,188
5,120
9
Operating costs:
Medical costs 38,939
35,863
3,076
9
Operating costs 8,517
8,506
11
—
Cost of products sold 7,381
6,184
1,197
19
Depreciation and amortization 639
582
57
10
Total operating costs 55,476
51,135
4,341
8
Earnings from operations 4,832
4,053
779
19
Interest expense (400 ) (329 ) (71 ) 22
Earnings before income taxes 4,432
3,724
708
19
Provision for income taxes (875 ) (800 ) (75 ) 9
Net earnings 3,557
2,924
633
22
Earnings attributable to noncontrolling interests (90 ) (88 ) (2 ) 2
Net earnings attributable to UnitedHealth Group common shareholders $ 3,467
$ 2,836
$ 631
22 %
Diluted earnings per share attributable to UnitedHealth Group common shareholders $ 3.56
$ 2.87
$ 0.69
24 %
Medical care ratio (a) 82.0 % 81.4 % 0.6 %
Operating cost ratio 14.1
15.4
(1.3 )
Operating margin 8.0
7.3
0.7

Tax rate 19.7
21.5
(1.8 )
Net earnings margin (b) 5.7
5.1
0.6

Return on equity (c) 26.8 % 23.8 % 3.0 %


(a)	Medical care ratio is calculated as medical costs divided by premium revenue.


(b)	Net earnings margin attributable to UnitedHealth Group shareholders.


(c)	Return on equity is calculated as annualized net earnings attributable to UnitedHealth Group common shareholders divided by average shareholders’ equity. Average shareholders’ equity is calculated using the shareholders’ equity balance at the end of the preceding year and the shareholders’ equity balances at the end of each of the quarters in the year presented.

~~2019~~2020 RESULTS OF OPERATIONS COMPARED TO ~~2018~~2019 RESULTS OF OPERATIONS

Consolidated Financial Results

Revenue

The ~~increase~~increases in revenue ~~was~~were primarily driven by the increase in the number of individuals served through ~~various~~ Medicare ~~products;~~Advantage; pricing trends; and acquisition and organic growth across the Optum business, primarily due to expansion in pharmacy care services and care ~~delivery; partially offset by the moratorium of the Health Insurance Industry Tax in 2019.~~delivery.

Medical Costs and MCR

Medical costs increased due to growth in people served through Medicare ~~products and~~Advantage, medical cost ~~trends.~~trends and calendar day impacts, partially offset by decreased people served in Medicaid due to a proactive market withdrawal and increased prior year favorable medical cost development. The MCR ~~increased~~decreased primarily due to the revenue effects of the return of the Health Insurance ~~Industry~~ Tax, ~~moratorium.~~partially offset by calendar day impacts.

Operating Cost Ratio

The operating cost ratio ~~decreased~~increased primarily due to the impact of the return of the Health Insurance ~~Industry~~ Tax ~~moratorium~~ and changes in business mix, partially offset by effective operating cost management.

Income Tax Rate

Our effective tax rate ~~decreased~~increased primarily due to the impact of the ~~moratorium~~return of the nondeductible Health Insurance ~~Industry~~ Tax.

Reportable Segments

See Note 7 of Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this report for more information on our segments. We utilize various metrics to evaluate and manage our reportable segments, including individuals served by UnitedHealthcare by major market segment and funding arrangement, people served by OptumHealth and adjusted scripts for OptumRx. These metrics are the main drivers of revenue, earnings and cash flows at each business. The metrics also allow management and investors to evaluate and understand business mix, customer penetration and pricing trends when comparing the metrics to revenue by segment.

The following table presents a summary of the reportable segment financial information:


	Three Months Ended March 31,						Increase/(Decrease)					Three Months Ended March 31,						Increase/(Decrease)
(in millions, except percentages)	2019			2018			2019 vs. 2018					2020			2019			2020 vs. 2019
Revenues
UnitedHealthcare	$	48,896		$	45,459		$	3,437		8	%	$	51,068		$	48,896		$	2,172		4	%
OptumHealth	6,713			5,759			954			17		9,192			6,713			2,479			37
OptumInsight	2,189			2,069			120			6		2,494			2,189			305			14
OptumRx	17,817			16,106			1,711			11		21,557			17,817			3,740			21
Optum eliminations	(359		)	(333		)	(26		)	8		(404		)	(359		)	(45		)	13
Optum	26,360			23,601			2,759			12		32,839			26,360			6,479			25
Eliminations	(14,948		)	(13,872		)	(1,076		)	8		(19,486		)	(14,948		)	(4,538		)	30
Consolidated revenues	$	60,308		$	55,188		$	5,120		9	%	$	64,421		$	60,308		$	4,113		7	%
Earnings from operations
UnitedHealthcare	$	2,954		$	2,400		$	554		23	%	$	2,888		$	2,954		$	(66	)	(2	)%
OptumHealth	626			488			138			28		712			626			86			14
OptumInsight	432			395			37			9		536			432			104			24
OptumRx	820			770			50			6		860			820			40			5
Optum	1,878			1,653			225			14		2,108			1,878			230			12
Consolidated earnings from operations	$	4,832		$	4,053		$	779		19	%	$	4,996		$	4,832		$	164		3	%
Operating margin
UnitedHealthcare	6.0		%	5.3		%	0.7		%			5.7		%	6.0		%	(0.3		)%
OptumHealth	9.3			8.5			0.8					7.7			9.3			(1.6		)
OptumInsight	19.7			19.1			0.6					21.5			19.7			1.8
OptumRx	4.6			4.8			(0.2		)			4.0			4.6			(0.6		)
Optum	7.1			7.0			0.1					6.4			7.1			(0.7		)
Consolidated operating margin	8.0		%	7.3		%	0.7		%			7.8		%	8.0		%	(0.2		)%

UnitedHealthcare

The following table summarizes UnitedHealthcare revenues by business:


	Three Months Ended March 31,				Increase/(Decrease)				Three Months Ended March 31,				Increase/(Decrease)
(in millions, except percentages)	2019		2018		2019 vs. 2018				2020		2019		2020 vs. 2019
UnitedHealthcare Employer & Individual	$	14,084	$	13,414	$	670	5	%	$	14,280	$	14,084	$	196		1	%
UnitedHealthcare Medicare & Retirement	21,096		18,925		2,171		11		23,152		21,096		2,056			10
UnitedHealthcare Community & State	11,182		10,671		511		5		11,453		11,182		271			2
UnitedHealthcare Global	2,534		2,449		85		3		2,183		2,534		(351		)	(14	)
Total UnitedHealthcare revenues	$	48,896	$	45,459	$	3,437	8	%	$	51,068	$	48,896	$	2,172		4	%

The following table summarizes the number of individuals served by our UnitedHealthcare businesses, by major market segment and funding arrangement:


	March 31,		Increase/(Decrease)				March 31,		Increase/(Decrease)
(in thousands, except percentages)	2019	2018	2019 vs. 2018				2020	2019	2020 vs. 2019
Commercial:
Risk-based	8,340	8,335	5		—	%	8,215	8,340	(125	)	(1	)%
Fee-based	19,175	18,475	700		4		18,825	19,175	(350	)	(2	)
Total commercial	27,515	26,810	705		3		27,040	27,515	(475	)	(2	)
Medicare Advantage	5,165	4,760	405		9		5,575	5,165	410		8
Medicaid	6,425	6,695	(270	)	(4	)	5,880	6,425	(545	)	(8	)
Medicare Supplement (Standardized)	4,500	4,490	10		—		4,440	4,500	(60	)	(1	)
Total public and senior	16,090	15,945	145		1		15,895	16,090	(195	)	(1	)
Total UnitedHealthcare - domestic medical	43,605	42,755	850		2		42,935	43,605	(670	)	(2	)
International	6,125	6,095	30		—		5,605	6,125	(520	)	(8	)
Total UnitedHealthcare - medical	49,730	48,850	880		2	%	48,540	49,730	(1,190	)	(2	)%
Supplemental Data:
Medicare Part D stand-alone	4,480	4,770	(290	)	(6	)%	4,150	4,480	(330	)	(7	)%

Fee-based and risk-based commercial ~~group~~ business ~~increased~~decreased primarily due to ~~a business combination.~~expected attrition. Medicare Advantage increased due to growth in people served through individual ~~and employer-sponsored group~~ Medicare Advantage plans. The decrease in people served through Medicaid was primarily driven by the proactive withdrawal from a market as well as by states ~~adding new carriers to existing programs, reduced enrollment from state efforts to manage~~managing eligibility, ~~status and the sale~~partially offset by increases in Dual Special Needs Plans. The decrease in people served internationally is a result of our ~~New Mexico Medicaid plan in 2018.~~continued affordability efforts and underwriting discipline.

UnitedHealthcare’s revenue ~~and earnings from operations~~ increased due to growth in the number of individuals served through ~~several~~ Medicare ~~products,~~Advantage, a greater mix of people with higher ~~revenue membership mix~~acuity needs and ~~rate increases for underlying medical cost trends. Revenue increases were~~the return of the Health Insurance Tax, partially offset by a decrease in the number of individuals served through the commercial and Medicaid businesses. Earnings from operations decreased primarily due to the return of the Health Insurance Tax and calendar day impacts, partially offset by the ~~moratorium on the Health Insurance Industry Tax in 2019.~~factors impacting revenue.

Optum

Total revenues and earnings from operations increased as each segment reported increased revenues and earnings from operations as a result of productivity and overall cost management initiatives in addition to the factors discussed below.

The results by segment were as follows:

OptumHealth

Revenue and earnings from operations increased at OptumHealth primarily due to ~~organic growth and business combinations in care delivery~~acquisitions and organic growth in ~~behavioral health.~~care delivery. OptumHealth served approximately 96 million people as of March 31, 2020 compared to 93 million people as of March 31, 2019.

OptumInsight

Revenue and earnings from operations at OptumInsight increased primarily due to organic growth and acquisitions in managed services.

OptumRx

Revenue at OptumRx and ~~earnings~~the corresponding eliminations increased due to the inclusion of retail pharmacy co-payments. See Note 1 of Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this report for further detail. Revenue at OptumRx also increased due to organic and acquisition growth in specialty pharmacy and new client wins, partially offset by an expected large client transition. Earnings from operations ~~at OptumRx~~ increased primarily due to ~~business combinations and organic growth in specialty pharmacy, home delivery services and overall prescription growth.~~improved supply chain management. OptumRx fulfilled 339 ~~million and 332~~ million adjusted scripts in the first ~~quarters~~quarter of 2020 and 2019, ~~and 2018, respectively.~~with organic growth in adjusted scripts being offset by the expected large client transition.

LIQUIDITY, FINANCIAL CONDITION AND CAPITAL RESOURCES

Liquidity

Summary of our Major Sources and Uses of Cash and Cash Equivalents


	Three Months Ended March 31,						Increase/(Decrease)			Three Months Ended March 31,						Increase/(Decrease)
(in millions)	2019			2018			2019 vs. 2018			2020			2019			2020 vs. 2019
Sources of cash:
Cash provided by operating activities	$	3,234		$	8,369		$	(5,135	)	$	2,943		$	3,234		$	(291	)
Issuances of commercial paper and long-term debt, net of repayments	1,851			3,159			(1,308		)
Issuances of short-term borrowings and long-term debt, net of repayments										10,797			1,851			8,946
Proceeds from common stock issuances	323			295			28			557			323			234
Customer funds administered	1,784			2,962			(1,178		)	1,062			1,784			(722		)
Sales and maturities of investments, net of purchases										30			—			30
Total sources of cash	7,192			14,785						15,389			7,192
Uses of cash:
Common stock repurchases	(3,002		)	(2,650		)	(352		)	(1,691		)	(3,002		)	1,311
Cash paid for acquisitions, net of cash assumed	(689		)	(2,583		)	1,894			(929		)	(689		)	(240		)
Purchases of investments, net of sales and maturities	(319		)	(1,385		)	1,066			—			(319		)	319
Purchases of property, equipment and capitalized software	(562		)	(477		)	(85		)	(469		)	(562		)	93
Cash dividends paid	(860		)	(722		)	(138		)	(1,024		)	(860		)	(164		)
Other	(214		)	(694		)	480			(563		)	(214		)	(349		)
Total uses of cash	(5,646		)	(8,511		)				(4,676		)	(5,646		)
Effect of exchange rate changes on cash and cash equivalents	(5		)	(12		)	7			(129		)	(5		)	(124		)
Net increase in cash and cash equivalents	$	1,541		$	6,262		$	(4,721	)	$	10,584		$	1,541		$	9,043

~~2019~~2020 Cash Flows Compared to ~~2018~~2019 Cash Flows

Decreased cash flows provided by operating activities were primarily driven by ~~the increase~~changes in unearned revenues in 2018 due to the March 2018 early receipt of our April CMS premium payment of $5.1 billion and the year-over-year impact of the Health Insurance Industry Tax moratorium, partially offset by higher net earnings.

working capital accounts. Other significant changes in sources or uses of cash year-over-year included ~~a decrease in cash paid for acquisitions,~~ increased ~~sales~~short-term borrowings and ~~maturities of investments,~~ decreased ~~issuances of commercial paper and~~common stock repurchases, partially offset by a decrease in customer funds ~~administered due to the early receipt of our CMS payment in 2018 described above.~~administered.

Financial Condition

As of March 31, ~~2019,~~2020, our cash, cash equivalent, available-for-sale debt securities and equity securities balances of ~~$47.0~~$58.9 billion included approximately ~~$12.4~~$21.6 billion of cash and cash equivalents (of which ~~$800 million~~$10.9 billion was available for general corporate use), ~~$32.6~~$35.6 billion of debt securities and ~~$2.0~~$1.7 billion of investments in equity securities. Cash available for general corporate use was intentionally higher than previous periods as a prudent response to more volatile financial markets. Given the significant portion of our portfolio held in cash and cash equivalents, we do not anticipate fluctuations in the aggregate fair value of our financial assets to have a material impact on our liquidity or capital position. Our available-for-sale debt portfolio had a weighted-average duration of 3.5 years and a weighted-average credit rating of “Double A” as of March 31, ~~2019.~~2020. When multiple credit ratings are available for an individual security, the average of the available ratings is used to determine the weighted-average credit rating.

Capital Resources and Uses of Liquidity

In addition to cash flows from operations and cash and cash equivalent balances available for general corporate use, our capital resources and uses of liquidity are as follows:

Commercial Paper and Bank Credit Facilities. Our revolving bank credit facilities provide liquidity support for our commercial paper borrowing program, which facilitates the private placement of unsecured debt through ~~third-party~~independent broker-dealers, and are available for general corporate purposes. For more information on our commercial paper and bank credit facilities, see Note 5 of Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this report.

Our revolving bank credit facilities contain various covenants, including covenants requiring us to maintain a defined debt to debt-plus-shareholders’ equity ratio of not more than 60%. As of March 31, ~~2019,~~2020, our debt to debt-plus-shareholders’ equity ratio, as defined and calculated under the credit facilities, was approximately ~~40%~~44%.

Long-Term Debt.Periodically, we access capital markets and issue long-term debt for general corporate purposes, such as, to meet our working capital requirements, to refinance debt, to finance acquisitions or for share repurchases. For more information on our long-term debt, see Note 5 of Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this report.

Credit Ratings. Our credit ratings as of March 31, ~~2019~~2020 were as follows:

Moody’s

S&P Global

Fitch

A.M. Best

Ratings

Outlook

Ratings

Outlook

Ratings

Outlook

Ratings

Outlook

Senior unsecured debt

Stable

A+

Stable

A-A

Stable

A-

~~Stable~~Positive

Commercial paper

P-2

n/a

A-1

n/a

AMB-1

n/a

The availability of financing in the form of debt or equity is influenced by many factors, including our profitability, operating cash flows, debt levels, credit ratings, debt covenants and other contractual restrictions, regulatory requirements and economic and market ~~conditions. For example, a~~conditions, including the impacts of COVID-19 and related governmental market stabilization programs. A significant downgrade in our credit ratings or adverse conditions in the capital markets may increase the cost of borrowing for us or limit our access to capital.

Share Repurchase Program. During the three months ended March 31, ~~2019,~~2020, we repurchased 126 million shares at an average price of ~~$252.76~~$271.32 per share. As of March 31, ~~2019,~~2020, we had Board authorization to purchase up to 8366 million shares of our common stock.

Dividends. Our quarterly cash dividend to shareholders reflects an annual dividend rate of ~~$3.60~~$4.32 per share.

For additional liquidity discussion, see Note 10 of Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 in our ~~2018~~2019 10-K.

CONTRACTUAL OBLIGATIONS AND COMMITMENTS

A summary of future obligations under our various contractual obligations and commitments as of December 31, ~~2018~~2019 was disclosed in our ~~2018~~2019 10-K. During the three months ended March 31, ~~2019,~~2020, there were no material changes to this previously disclosed information outside the ordinary course of business. However, we continually evaluate opportunities to expand our operations, including through internal development of new products, programs and technology applications and acquisitions.

RECENTLY ISSUED ACCOUNTING STANDARDS

See Note 1 of Notes to the Condensed Consolidated Financial Statements in Part I, Item 1 of this report for a discussion of new accounting pronouncements that affect us.

CRITICAL ACCOUNTING ESTIMATES

In preparing our Condensed Consolidated Financial Statements, we are required to make judgments, assumptions and estimates, which we believe are reasonable and prudent based on the available facts and circumstances. These judgments, assumptions and estimates affect certain of our revenues and expenses and their related balance sheet accounts and disclosure of our contingent liabilities. We base our assumptions and estimates primarily on historical experience and consider known and projected trends. On an ongoing basis, we re-evaluate our selection of assumptions and the method of calculating our estimates. Actual results, however, may materially differ from our calculated estimates, and this difference would be reported in our current operations.

Our critical accounting estimates include medical costs payable and goodwill. For a detailed description of our critical accounting estimates, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 in our ~~2018~~2019 10-K. For a detailed discussion of our significant accounting policies, see Note 2 of Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data” in our ~~2018~~2019 10-K.

FORWARD-LOOKING STATEMENTS

The statements, estimates, projections, guidance or outlook contained in this document include “forward-looking” statements ~~within the meaning of the PSLRA. These statements~~which are intended to take advantage of the “safe harbor” provisions of the

~~PSLRA. Generally the~~ federal securities law. The words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “forecast,” “outlook,” “plan,” “project,” “should” and similar expressions identify forward-looking ~~statements, which generally are not historical in nature.~~statements. These statements may contain information about financial prospects, economic conditions and trends and involve risks and uncertainties. ~~We caution that actual~~Actual results could differ materially from those that management expects, depending on the outcome of certain ~~factors.~~

~~Some~~ factors ~~that could cause actual results to differ materially from results discussed or implied in~~including: risks associated with public health crises, large-scale medical emergencies and pandemics, such as the ~~forward-looking statements include:~~COVID-19 pandemic; our ability to effectively estimate, price for and manage ~~our~~ medical ~~costs, including the impact of any~~costs; new ~~coverage requirements; new laws or regulations,~~ or changes in existing health care laws or regulations, or their enforcement or application, including increases in medical, administrative, technology or other costs or decreases in enrollment resulting from U.S., South American and other jurisdictions’ regulations affecting the health care industry; the outcome ofapplication; the DOJ’s legal action relating to the risk adjustment submission matter; our ability to maintain and achieve improvement in ~~CMS star ratings and other~~ quality scores ~~that impact~~impacting revenue; reductions in revenue or delays to cash flows received under ~~Medicare, Medicaid and other~~ government ~~programs, including the effects of a prolonged U.S. government shutdown or debt ceiling constraints;~~programs; changes in Medicare, ~~including changes in payment methodology,~~ the CMS star ratings program or the application of risk adjustment data validation audits; failure to maintain effective and efficient information systems or if our technology products do not operate as intended; cyber-attacks, or other ~~privacy or~~ privacy/data security ~~incidents;~~incidents, or our failure to comply with ~~privacy and data security~~related regulations; ~~regulatory and other~~ risks and uncertainties ofassociated with the pharmacy benefits management industry; competitive ~~pressures, which could affect our ability to maintain or increase our market share;~~pressures; changes in or challenges to our public sector contract awards; our ability to ~~execute contracts~~contract on competitive terms with physicians, hospitals and other service providers; failure to achieve targeted operating cost productivity ~~improvements, including savings resulting from technology enhancement and administrative modernization;~~improvements; increases in costs and other liabilities associated with ~~increased~~ litigation, government investigations, audits or reviews; failure to manage successfully our strategic alliances or complete or receive anticipated benefits of ~~acquisitions and other~~ strategic ~~transactions,~~transactions; fluctuations in foreign currency exchange ~~rates on our reported shareholders’ equity and results of operations;~~rates; downgrades in our credit ratings; ~~the performance of~~ our investment ~~portfolio;~~portfolio performance; impairment ~~of the value~~ of our goodwill and intangible assets if estimated future results do not adequately support goodwill and intangible assets recorded for our existing businesses or the businesses that we acquire; failure to maintain effective and efficient information systems or if our technology products do not operate as intended;assets; and our ability to obtain sufficient funds from our regulated subsidiaries or ~~the debt or capital markets~~from external financings to fund our obligations, to maintain our debt to total capital ratio at targeted levels, to maintain our quarterly dividend payment cycle, or to continue repurchasing shares of our common stock.

This above list ~~of important factors~~ is not ~~intended to be~~ exhaustive. We discuss ~~certain of~~ these matters, ~~more fully, as well as~~and certain ~~risk factors~~risks that may affect our business operations, financial condition and results of operations more fully in our ~~other periodic and current~~ filings with the SEC, including our ~~annual~~ reports on ~~Form~~Forms 10-K, ~~quarterly reports on Form~~ 10-Q and ~~current reports on Form~~ 8-K. ~~Any or all forward-looking statements we make may turn out to be wrong, and can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties.~~ By their nature, forward-looking statements are not guarantees of future performance or results and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Actual ~~future~~ results may vary materially from expectations expressed or implied in this document or any of our prior communications. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. We do not undertake to update or revise any forward-looking statements, except as required by ~~applicable securities laws.~~law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We manage exposure to market interest rates by diversifying investments across different fixed-income market sectors and debt across maturities, as well as by endeavoring to match our floating-rate assets and liabilities over time, either directly or through the use of interest rate swap contracts. Unrealized gains and losses on investments in available-for-sale debt securities are reported in comprehensive income.

The following table summarizes the impact of hypothetical changes in market interest rates across the entire yield curve by 1% point or 2% points as of March 31, ~~2019~~2020 on our investment income and interest expense per annum, and the fair value of our investments and debt (in millions, except percentages):


	March 31, 2019												March 31, 2020
Increase (Decrease) in Market Interest Rate	Investment Income Per Annum			Interest Expense Per Annum			Fair Value of Financial Assets			Fair Value of Financial Liabilities			Investment Income Per Annum (a)			Interest Expense Per Annum (a)			Fair Value of Financial Assets (b)			Fair Value of Financial Liabilities
2 %	$	306		$	260		$	(2,294	)	$	(5,249	)	$	491		$	404		$	(2,514	)	$	(6,673	)
1	153			130			(1,159		)	(2,849		)	246			202			(1,250		)	(3,628		)
(1)	(153		)	(130		)	1,115			3,327			(160		)	(202		)	784			3,735
(2)	(306		)	(260		)	2,088			7,327			(160		)	(267		)	877			4,694


(a)	Given the low absolute level of short-term market rates on our floating-rate assets and liabilities as of March 31, 2020, the assumed hypothetical change in interest rates does not reflect the full 100 and 200 basis point reduction in interest income or the full 200 basis point reduction in interest expense, as the rate cannot fall below zero.


(b)	As of March 31, 2020, some of our investments had interest rates below 2% so the assumed hypothetical change in the fair value of investments does not reflect the full 100 and 200 basis point reduction.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules and forms; and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

In connection with the filing of this quarterly report on Form 10-Q, management evaluated, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, ~~2019.~~2020. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of March 31, ~~2019.~~2020.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in our internal control over financial reporting during the quarter ended March 31, ~~2019~~2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION


ITEM 1.	LEGAL PROCEEDINGS

A description of our legal proceedings is included in and incorporated by reference to Note 6 of Notes to the Condensed Consolidated Financial Statements contained in Part I, Item 1 of this report.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A, “Risk Factors” of our ~~2018~~2019 10-K, which could materially affect our business, financial condition or future results. The risks described in our ~~2018~~2019 10-K and in this Item 1A, are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or future results.

There have been no other material changes to the risk factors disclosed in our ~~2018 10-K.~~2019 10-K except that we have added the following risk factor to provide details on our risks associated with COVID-19:

We are subject to risks associated with public health crises, large-scale medical emergencies and pandemics, such as the COVID-19 pandemic, which could have a material adverse effect on our business, results of operations, financial condition and financial performance.

The rapidly developing COVID-19 global health crisis is having major impacts on health systems, businesses, governments and customer and consumer activities. UnitedHealth Group continues to mobilize the full strength of its resources to deliver the best care for patients, support for its members and care provider partners, and deliver innovative solutions and support for the communities we serve and the entire health system. The impact to our business is primarily dependent upon the ultimate pacing, intensity and duration of the crisis, factors which we cannot predict at this time. These factors will drive the related treatment, testing, coverage and other services we provide for the people we serve. The health system has recently experienced deferrals of elective care, which impacts both the UnitedHealthcare and Optum businesses through decreased utilization of health care services. As the crisis abates, we may experience an increase in medical care costs as people seek care which was deferred during the pandemic and individuals with chronic conditions may require additional care needs resulting from missed treatments. There can be no assurance that the premiums and fees we charge will be sufficient to cover the medical and administrative costs associated with COVID-19. In addition, we may experience reduced demand for certain services Optum provides to care providers and health plans as a result of reduced clinical and claims activity and changes in business priorities resulting from COVID-19. We cannot at this time measure the impact or duration of changing customer, consumer and member behavior to our overall business.

Governmental policies and initiatives to address COVID-19 have resulted in our customers having to close or severely curtail their operations. Among other impacts, we may experience loss of commercial membership due to customer reductions in workforce and an adverse impact on the timing and collectability of premium payments. In addition, governments have modified, and may continue to modify, regulatory standards around various aspects of health care in response to COVID-19,

and these rapidly changing standards may create challenges for us to ensure timely compliance and meet various contractual obligations.

Disruptions in public and private infrastructure, including supply chains providing medical supplies and pharmaceutical products, could adversely disrupt our business operations. Additionally, the enactment of emergency powers by governments could disrupt our business operations, including restricting pharmaceuticals or other supplies, and could increase the risk of shortages of necessary items.

We have transitioned a significant number of our team members to at-home work environments in an effort to mitigate the spread of COVID-19. This transition may increase our operating costs and effectiveness, including our ability to maintain service levels and ratings, and exacerbate certain risks to our business, including demand for information technology resources, increased vulnerabilities to cybersecurity attacks, and increased risk of unauthorized dissemination of sensitive personal information or proprietary or confidential information about us, our customers or our members.

The COVID-19 crisis has also adversely impacted global access to capital and caused significant volatility in financial markets. Significant deterioration of the U.S. and global economies could have a significant adverse impact on our investment income, the value of our investments, or future liquidity needs.

Because of the unknown pacing, intensity and duration of this pandemic, we cannot predict the impact of its ultimate disruption to business activities, its employment and economic effects, its near and long-term impacts on the patterns of care and services across the healthcare system, or the ultimate resulting impact on our business, results of operations, financial position or cash flows.


ITEM 2.	UNREGISTERED SALE OF EQUITY SECURITIES AND USE OF PROCEEDS

In November 1997, our Board of Directors adopted a share repurchase program, which the Board evaluates periodically. There is no established expiration date for the program. During the first quarter ~~2019,~~2020, we repurchased approximately 126 million shares at an average price of ~~$252.76~~$271.32 per share. As of March 31, ~~2019,~~2020, we had Board authorization to purchase up to 8366 million shares of our common stock.


ITEM 6.	EXHIBITS*

The following exhibits are filed or incorporated by reference herein in response to Item 601 of Regulation S-K. The Company files Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K pursuant to the Securities Exchange Act of 1934 under Commission File No. 1-10864.



3.1			Certificate of Incorporation of UnitedHealth Group Incorporated (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form 8-A/A filed on July 1, 2015)
3.2			Bylaws of UnitedHealth Group Incorporated, effective August 15, 2017 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on August 16, 2017)
4.1			Senior Indenture, dated as of November 15, 1998, between United HealthCare Corporation and The Bank of New York (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-3/A, SEC File Number 333-66013, filed on January 11, 1999)
4.2			Amendment, dated as of November 6, 2000, to Senior Indenture, dated as of November 15, 1998, between UnitedHealth Group Incorporated and The Bank of New York (incorporated by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2001)
4.3			Instrument of Resignation, Appointment and Acceptance of Trustee, dated January 8, 2007, pursuant to the Senior Indenture, dated as of November 15, 1998, amended November 6, 2000, among UnitedHealth Group Incorporated, The Bank of New York and Wilmington Trust Company (incorporated by reference to Exhibit 4.3 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2007)
4.4			Indenture, dated as of February 4, 2008, between UnitedHealth Group Incorporated and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-3, SEC File Number 333-149031, filed on February 4, 2008)
31.1			Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1			Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
~~101~~101.INS			~~The following materials from UnitedHealth Group Incorporated’s Quarterly Report on Form 10-Q for~~XBRL Instance Document - the ~~quarter ended March 31, 2019 filed on May 7, 2019, formatted~~instance document does not appear in the Interactive Data File because its XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statements of Changes in Equity, (v) Condensed Consolidated Statements of Cash Flows,tags are embedded within the Inline XBRL document.
101.SCH			Inline XBRL Taxonomy Extension Schema Document.
101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104			Cover Page Interactive Data File (formatted as Inline XBRL and ~~(vi) Notes to the Condensed Consolidated Financial Statements.~~embedded within Exhibit 101).

________________



*		Pursuant to Item 601(b)(4)(iii) of Regulation S-K, copies of instruments defining the rights of certain holders of long-term debt are not filed. The Company will furnish copies thereof to the SEC upon request.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

UNITEDHEALTH GROUP INCORPORATED



/s/ DAVID S. WICHMANN	Chief Executive Officer (principal executive officer)	Dated:	May ~~7, 2019~~6, 2020
David S. Wichmann	Chief Executive Officer (principal executive officer)

/s/ JOHN F. REX	Executive Vice President and Chief Financial Officer (principal financial officer)	Dated:	May ~~7, 2019~~6, 2020
John F. Rex

/s/THOMAS E. ROOS	Senior Vice President and Chief Accounting Officer (principal accounting officer)	Dated:	May ~~7, 2019~~6, 2020
Thomas E. Roos

2425



	March 31, 2019						December 31, 2018
(in millions, except percentages)	Par Value		Carrying Value		Fair Value		Par Value		Carrying Value		Fair Value
Commercial paper	$	3,134	$	3,117	$	3,117	$	—	$	—	$	—
1.700% notes due February 2019	—		—		—		750		750		749
1.625% notes due March 2019	—		—		—		500		500		499
2.300% notes due December 2019	500		496		499		500		494		497
2.700% notes due July 2020	1,500		1,498		1,503		1,500		1,498		1,494
Floating rate notes due October 2020	300		299		300		300		299		298
3.875% notes due October 2020	450		445		457		450		443		456
1.950% notes due October 2020	900		897		890		900		897		884
4.700% notes due February 2021	400		400		413		400		398		412
2.125% notes due March 2021	750		748		744		750		747		734
Floating rate notes due June 2021	350		349		350		350		349		347
3.150% notes due June 2021	400		399		404		400		399		400
3.375% notes due November 2021	500		493		508		500		489		503
2.875% notes due December 2021	750		742		754		750		735		748
2.875% notes due March 2022	1,100		1,063		1,107		1,100		1,051		1,091
3.350% notes due July 2022	1,000		997		1,022		1,000		997		1,005
2.375% notes due October 2022	900		895		891		900		894		872
0.000% notes due November 2022	15		12		13		15		12		13
2.750% notes due February 2023	625		610		625		625		602		611
2.875% notes due March 2023	750		758		754		750		750		739
3.500% notes due June 2023	750		747		773		750		746		756
3.500% notes due February 2024	750		745		772		750		745		755
3.750% notes due July 2025	2,000		1,989		2,088		2,000		1,989		2,025
3.700% notes due December 2025	300		298		312		300		298		303
3.100% notes due March 2026	1,000		996		999		1,000		995		965
3.450% notes due January 2027	750		746		763		750		746		742
3.375% notes due April 2027	625		619		633		625		619		611
2.950% notes due October 2027	950		938		933		950		938		898
3.850% notes due June 2028	1,150		1,142		1,204		1,150		1,142		1,163
3.875% notes due December 2028	850		842		890		850		842		861
4.625% notes due July 2035	1,000		992		1,121		1,000		992		1,060
5.800% notes due March 2036	850		838		1,045		850		838		1,003
6.500% notes due June 2037	500		492		661		500		492		638
6.625% notes due November 2037	650		641		874		650		641		841
6.875% notes due February 2038	1,100		1,076		1,514		1,100		1,076		1,437
5.700% notes due October 2040	300		296		370		300		296		355
5.950% notes due February 2041	350		345		446		350		345		426
4.625% notes due November 2041	600		588		657		600		588		627
4.375% notes due March 2042	502		484		534		502		484		503
3.950% notes due October 2042	625		607		631		625		607		596
4.250% notes due March 2043	750		735		787		750		734		744
4.750% notes due July 2045	2,000		1,973		2,260		2,000		1,973		2,116
4.200% notes due January 2047	750		738		777		750		738		745
4.250% notes due April 2047	725		717		759		725		717		719
3.750% notes due October 2047	950		933		923		950		933		869
4.250% notes due June 2048	1,350		1,329		1,420		1,350		1,329		1,349
4.450% notes due December 2048	1,100		1,087		1,191		1,100		1,087		1,132
Total commercial paper and long-term debt	$	37,551	$	37,151	$	39,688	$	35,667	$	35,234	$	36,591



(in millions)	Future Operating Lease Payments
2019	480
2020	667
2021	578
2022	481
2023	393
Thereafter	1,553
Total future minimum lease payments	4,152
Less imputed interest	(731	)
Total	3,421