UnitedHealth Group has started offering buyouts to employees in its UnitedHealthcare insurance division. The announcement was made during an employee webinar on February 17. A UnitedHealth executive described the buyouts as a “great opportunity” for employees.
The executive said it would help ease transitions and maintain the company’s work environment. UnitedHealth aims to reduce its workforce through voluntary departures. This is to streamline operations and cut costs in a competitive healthcare market.
UnitedHealthcare is seeking to reduce its workforce through a Voluntary Resignation Separation Program. The program targets employees in four internal segments under benefits operations. These include corporate, consumer operations, core services, and provider services.
The company aims to meet a resignation quota through these buyouts. If the target is not met, layoffs will follow, according to sources. This move comes after UnitedHealth Group dealt with a series of crises in the last year.
These included the fatal shooting of UnitedHealthcare’s CEO and a costly cyberattack on its subsidiary Change Healthcare.
Employee buyout details explained
UnitedHealth Group is the largest private health insurer in the U.S. with more than 440,000 employees.
The company is looking to cut costs amid rising medical expenses for Medicare Advantage beneficiaries and fallout from the cyberattack. Despite these challenges, the company reported its highest-ever annual revenue of $400.3 billion in 2024, an 8% increase from the previous year. According to an internal memo, full-time and part-time U.S. workers in the designated segments are eligible for the buyout program.
The memo indicates that the employees’ termination date under the buyout will be no sooner than May 1. Some may need to work beyond that date but not past November 13. Severance packages will be determined based on the employees’ tenure and salary grade.
UnitedHealthcare’s spokesperson stated, “This voluntary option is part of our ongoing efforts to ensure our team is best positioned to meet the evolving needs of the people and customers we are honored to serve.”
The company continues to recruit, with over 3,200 positions currently available on its careers site. Employees who do not opt for the buyouts will continue in their current or comparable roles. However, the benefits provided to employees who are laid off may not be as favorable as those offered under the buyout program.
The buyout announcements have left many employees in shock, especially since the company reported a strong financial performance last year. Workers were informed about the buyouts during a brief meeting on Monday and will have the opportunity to ask questions in forthcoming information sessions. Shares of UnitedHealth Group closed up 2% on Wednesday following the news.
