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US firm advising NHS sees profits surge

Controversial US group UnitedHealth, which runs GPs' practices and advises PCTs in UK, reports 30% leap in profits to $1.1bn

A patient sees her GP
UnitedHealth runs several GP practices in the UK as well as advising Primary Care Trusts. The company recently had to repay $350m to settle a US case in which it was accused of artificially depressing insurance repayments to customers. Photograph: Alamy

A US health insurance company that recently won a multimillion-pound contract to advise primary care trusts (PCTs), has reported a surge in profits over the last three months.

UnitedHealth Group, which also operates five GP practices in Derbyshire and London, reported second-quarter profits climbed 30% on the same quarter a year ago to $1.1bn (£720m) on turnover of $23bn.

The stock market-listed firm said the bulk of its growth came in the United States after it signed up more members for the government-backed Medicare and Medicaid policies.

The company signed a contract with the Department of Health last month to advise PCTs on commissioning ahead of reforms that will give GPs the lion's share of the NHS budget.

PCTs directly run GP practices and offer contracts to self-employed GP doctors and private firms to operate independent practices. GPs will be in charge of £90bn of the health budget under plans put forward by the health secretary, Andrew Lansley.

UnitedHealth will use its experience of private healthcare to bring efficiencies to the bidding processes.

US unions have complained about the company, which has come under fire for malpractice. In 2008, its former boss William McGuire was banned as a director and forced to repay $468m following a scandal related to backdated stock options.

In January the company agreed to pay $350m to settle a case brought by the New York attorney general, Andrew Cuomo, who accused the firm of boosting profits by artificially depressing insurance repayments to customers.

The company based repayments on "independent" assessments by a company called Ingenix, which was a subsidiary of UnitedHealth.

The company is based in Minnesota, from where it has grown to be the largest health insurer by sales in the US. The company, which has more than 50,000 staff and 60 million health plan customers, is expected to have annual revenues in excess of $80bn this year.


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