Assuming the role of the mutual fund manager and after conducting a SWOT analysis, the decision has been made to select the Fortune 500 Company UnitedHealth Group to invest in. UnitedHealth Group operates in all 50 states and is based out of Minnetonka, Minnesota. The purpose of this paper is to identify the company’s internal and external stakeholders, describe their wants and needs, and explain how the company is fulfilling those needs. UnitedHealth Group UnitedHealth Group is a prominent health care company, serving more than 75 million individuals worldwide.
UnitedHealth Group touches virtually every characteristic of health care, helping individuals live healthier lives. As a leader in the health benefits and services industry, the six businesses of the UnitedHealth Group are UnitedHealthcare Employer & Individual, UnitedHealthcare Medicare & Retirement, UnitedHealthcare Community & State, OptumHealth, OptumInsight, and OptumRx which offers incomparable service, comprehensive capabilities and lasting significance in producing a contemporary health care organism.
The products and services empower individuals, expand consumer choice and strengthen patient-provider relationships across the health care spectrum (“UnitedHealth Group, n. d. ”). Internal, Interface, and External Stakeholders In Healthcare, the definition of quality can be difficult and debatable because of the diverse assessments of individuals with a stake in decent Healthcare. Let’s glance at a few different stakeholders. The stakeholders are broken done into three categories, internal, interface, and external.
The internal stakeholders consists of the management (Human resource manager, Clinical managers, Pharmaceutical managers, Engineering, etc. ), non-management (nursing, environmental services, administration, etc. ) and professional staff (CEO, COO, doctors, lawyers, etc. ). The interface stakeholders are the medical staff, the hospital board of trustees, the corporate office of the parent company, the stockholders, the taxpayers, and other contributors.
These stakeholders tend to be the most powerful stakeholders in the healthcare organization but are the most misunderstood because they are thought of as the “us” or “them” when they are both and neither. The external stakeholders consists of everyone else such as the patients, suppliers or vendors, competitors, related health care organizations, government agencies, private accrediting associations, professional associations, labor unions, third party payers, the media, the financial community, special interest groups, and the local community.
After conducting a thorough SWOT analysis the UnitedHealth group it was discovered that the strengths of the company were proficiencies in diversified health benefits market segment, national scale helping influence proficiencies and trademark, and strong presence in high margin health services business. 1. ) Proficiencies in diversified health benefits market segment. UnitedHealth Group offers a robust suite of products including dental, vision, behavioral, pharmacy benefit management (PBM), disease management, Medicare and other analytical and medical management support services.
Ovations, which is a subsidiary of UnitedHealth Group provides the only Medicare prescription drug coverage plan branded by AARP, the nation’s largest membership institute devoted to the necessity of people aged 50 and older (“UnitedHealth Group, n. d. ”). 2. ) National scale helping influence proficiencies and trademark. UnitedHealth Group is one of the leading insurers in the United States, serving more than 75 million members through approximately 730,000 physicians and other health care professionals and 5,300 hospitals across the United States. With revenues of
more than $94 billion in FY2010, it is the largest publicly traded health insurance companies in the United States ("CNN Money", 2012). 3. ) Strong presence in high margin health services business. In addition to UnitedHealth Group’s leadership position in the health benefits market segment, UnitedHealth Group has strong information and technology based health services platform through its business segments which is Ingenix, OptumHealth and PrescriptionSolutions. The “CNN MONEY” (2012) website states Ingenix is one of the largest health information, technology and consulting companies in the world.
The UnitedHealth Group derived $2. 3 billion of revenues from Ingenix which contributed $284 million (excluding $200 million in goodwill impairment and business line deposition charges) of operating profit, and an operating margin of 12. 1% during FY2010. After conducting a thorough SWOT analysis the UnitedHealth group it was discovered that the weaknesses are a significant level of indebtedness affecting financial flexibility for business expansion and the options backdating allegations had negative impact on investor confidence.
1. ) Significant level of indebtedness affecting financial flexibility for business expansion. The UnitedHealth Group had a long term debt (less current maturities) of $8. 7 billion in FY2010 as compared to that of $7. 5 billion in 2006 ("Research and Markets", 2012). 2. ) Options backdating allegations had negative impact on investor confidence. The manner in which permitting an option that is dated prior to the date that the company approved that option.
In 2006 the UnitedHealth Group was investigated by the IRS and the SEC in response to allegations of options backdating ("Research and Markets", 2012). Because of this transaction, the company’s public image was tarnished. After conducting a thorough SWOT analysis the UnitedHealth group it was discovered that the opportunities were enhancing Ingenix technology and services collection likely to help UHG grow in high margin health services sector, presence of uninsured population to drive membership base growth, and advantageous inclinations towards low cost generic drugs endorsement could help save cost.
The threats of the SWOT analysis are health care cost containment could limit earning potential and negative publicity likely to affect private health insurance business. One of the most significant desires of the UnitedHealth group is to continue to build the trust that was compromised in 2006 when the allegations of backdating stock options was in the media. Since then, the form UHG CEO, William McGuire resigned due to his involvement ("Democratic Underground", 2011). UnitedHealth Group wants to not be so threatened by the Health Care Reform.
UHG is in the position to be profitable because of their low cost in healthcare insurance and the high percentage of healthy clients versus the not so healthy and the balancing of the health care costs. A SWOT analysis for The UnitedHealth Group was conducted to determine if this would be a good investment. The analysis was thorough screening the strengths, weaknesses, opportunities, and threats that affect this company. As a mutual fund manager, it is believed that with further future research UHG will be a great investment.
In this paper UnitedHealth Group’s internal and external stakeholders were identified, the description of their wants and needs was established, and how the company is fulfilling those needs was explain. References CNNMoney. (2012). Retrieved from http://money. cnn. com/magazines/fortune/fortune500/2011/snapshots/3147. html Democratic underground. (2011). Retrieved from http://wwwdemocraticunderground. com/discuss/dubard. php? az=view_all Research and markets. (2012). Retrieved from http://www. researchandmarkets/reports/481636/ UnitedHealth Group. (n. d. ). Retrieved from http://www. unitedhealthgroup. com/main/AboutUs. aspx