What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-02 compared with 2025-02-27 · 113 added, 95 removed, 287 unchanged (42% of the section changed)

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Further information on our business and reportable segments is presented in Part I, Item 1, “Business” and in Note 15 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”

Change Healthcare Cyberattack

As previously announced, on February 21, 2024, we identified that cybercrime threat actors had gained access to certain Change Healthcare information technology systems.

Upon detection of this outside threat, we isolated the impacted systems to protect our partners and customers.

We have substantially mitigated the impact to consumers and care providers of the unprecedented cyberattack on the U.S.

health system and restored or replaced the majority of the affected Change Healthcare services.

To support care providers we provided interest-free loans of more than $9 billion through December 31, 2024.

For the year ended December 31, 2024, we incurred $2.2 billion of direct response costs, including costs associated with providing interest-free loans;

increased medical care expenditures, as we suspended some care management activities to help care providers with their workflow processes;

network restoration;

and notifications of impacted persons.

Optum Insight also experienced estimated business disruption impacts of $867 million for the year ended December 31, 2024, reflecting lost revenue while maintaining full readiness of the affected Change Healthcare services.

We expect to continue to incur direct response costs and experience business disruption impacts at a lesser extent in 2025 as we work to bring transaction volumes back to pre-event levels and win new business.

We have determined the estimated total number of individuals impacted by the Change Healthcare cyberattack is approximately 190 million.

The vast majority of those people have already been provided individual or substitute notice.

The final number will be confirmed and filed with the Office for Civil Rights.

Change Healthcare is not aware of any misuse of individuals’ information as a result of this incident and has not seen electronic medical record databases appear in the data during the analysis.

It is possible that future risks and uncertainties resulting from the Change Healthcare cyberattack, including risks related to impacted data, litigation, reputational harm, and regulatory actions could adversely affect our financial condition or results of operations.

2026 Business Realignment

On January 1, 2026, we realigned certain of our businesses to respond to changes in the markets we serve and the opportunities that are emerging as the health system evolves.

Optum Financial, including Optum Bank, which was historically included in Optum Health, will now be included in Optum Insight.

Our reportable segments will remain unchanged, with prior period segment financial information being recast to conform to the 2026 presentation, beginning with our Quarterly Report of Form 10-Q for the three months ended March 31, 2026 filed with the SEC.

Net Portfolio Divestitures, Restructuring and Other Actions and Direct Response Costs - Cyberattack

Net Portfolio Divestitures

In the fourth quarter of 2025, the Company took various actions as a result of a strategic review of the Company’s assets and businesses to operationally advance and scale core businesses and initiatives, including the value-based care business at Optum Health.

These actions primarily include losses on business exits and dispositions and other businesses held for sale and a gain on the deconsolidation of a business.

As a result of the Company’s portfolio actions, the Company recorded a net gain of $568 million, which included a net gain of $1.5 billion at Optum Rx, partially offset by losses of $821 million and $68 million at Optum Health and Optum Insight, respectively.

Gains and losses on portfolio actions were recorded within operating costs on the Consolidated Statements of Operations.

Restructuring and Other Actions

Additionally, in the fourth quarter of 2025 the Company took restructuring and other actions that resulted in a total impact of $2.5 billion, which included real estate rationalization and workforce reductions of $746 million, contractual reassessments of $573 million, the establishment a loss contract reserve related to anticipated future losses in 2026 for certain value-based care businesses of $623 million, net valuation losses on equity securities of $329 million and the advance funding of the United Health Foundation of $250 million.

The $2.5 billion impact of the restructuring and other actions was a reduction to premium revenue of $122 million and investment and other income of $397 million, and increased medical costs $623 million and operating costs $1.4 billion on the Consolidated Statements of Operations.

The impacts by reportable segment were $153

million, $1.7 billion, $236 million and $389 million, for UnitedHealthcare, Optum Health, Optum Insight and Optum Rx, respectively.

The net impact on 2026 cash flows as a result of the restructuring actions taken in 2025 is not expected to be material, with accruals recorded in 2025 resulting in operating cash outflows, offset by investing cash inflows related sales of businesses that are held for sale.

Direct Response Costs – Cyberattack

To support care providers impacted by the Change Healthcare cyberattack that occurred on February 21, 2024, the Company provided interest-free loans.

In the fourth quarter of 2025, the Company increased its reserves for net collection expectations associated with provider loans and other customer balances of $799 million, which were recorded within operating costs on the Consolidated Statements of Operations and related to Optum Insight.

Business Trends

Our businesses participate in the United States and certain other international health markets.

In the United States, health care spending has grown consistently for many years and comprises 18% of gross domestic product (GDP).

Our businesses participate primarily in the United States health markets.

In the United States, health care spending has grown consistently for many years and accounted for 19% of gross domestic product (GDP) in 2025.

We expect overall spending on health care to continue to grow in the future, due to inflation, medical technology and pharmaceutical advancement, regulatory 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 macroeconomic conditions, which could impact our results of operations, including our continued efforts to control health care costs.

The rate of market growth may be affected by a variety of factors, including macroeconomic conditions and regulatory changes, which could impact our results of operations, including our continued efforts to control health care costs.

Pricing Trends.

To price our health care benefits, products and services, we start with our view of expected future costs, including medical care patterns, inflation and labor market dynamics.

We frequently evaluate and adjust our approach in each of the local markets we serve, considering relevant factors, such as product positioning, price competitiveness and environmental, competitive, legislative and regulatory considerations, including minimum medical loss ratio (MLR) thresholds and similar revenue adjustments.

We will continue seeking to balance growth and profitability across all these dimensions.

To price our health care benefits, products and services, we start with our view of expected future costs, including medical care patterns, the mix and health status of people served, inflation and labor market dynamics.

For 2025, our pricing trends and patient and member health status assumptions were well-short of the medical cost trends incurred, significantly impacting our earnings.

We continually evaluate and adjust our approach in each of the local markets we serve, considering relevant factors, such as product positioning, price competitiveness and environmental, competitive, legislative and regulatory considerations, including minimum medical loss ratio (MLR) thresholds and similar revenue adjustments.

We seek to balance growth and profitability across all these dimensions.

The commercial risk market remains highly competitive in the small group, large group and individual segments.

We expect broad-based competition to continue as the industry adapts to individual and employer needs.

Medicare Advantage funding continues to be pressured, as discussed below in “Regulatory Trends and Uncertainties” and we have observed increased care patterns as discussed below in “Medical Cost Trends.” Our 2025 benefit design approach contemplates these trends.

In Medicaid, we believe the payment rate environment creates the risk of continued downward pressure on Medicaid margin percentages.

Continued increased medical costs may impact both future pricing and benefit design, including for our individual exchange products in markets where we choose to remain, and may result in shifts between product categories for our employer benefits.

These potential changes, along with certain regulatory impacts, may result in decreased membership in future periods.

Medicare Advantage funding continues to be pressured, as discussed below in “Regulatory Trends and Uncertainties” and we have observed increased care patterns as discussed below in “Medical Cost Trends”, which is contemplated in our 2026 benefit design approach.

As a result of continued funding pressures, which have resulted in benefit and pricing actions, we expect that our Medicare Advantage membership will contract in 2026.

Optum Health’s fully accountable value-based care businesses have been impacted by Medicare funding reductions and have also seen continued medical cost trend pressures, which may impact future pricing in the markets we continue to participate in.

As a result of increased pricing in response to anticipated care patterns in 2026 and decreased people served through UnitedHealthcare Medicare Advantage offerings, we expect the number of people served under value-based care arrangements to contract.

Due to elevated care activity in Medicaid, specifically related to behavioral, pharmacy and home health, there continues to be a timing mismatch between the health status of people served and state rate updates.

The funding and payment rate environment remains insufficient to meet the health needs of patients and creates the risk of continued downward pressure on Medicaid margin percentages.

We continue to take a prudent, market-sustainable posture for both new business and maintenance of existing relationships.

We continue to advocate for actuarially sound rates commensurate with our medical cost trends and we remain dedicated to partnering with those states that are committed to the long-term viability of their programs.

We expect Medicaid membership losses in 2026 as a result of reduced Medicaid eligibility and the exit from one state.

Medical Cost Trends.

Our medical cost trends primarily relate to changes in unit costs, care activity and prescription drug costs.

As expected and contemplated in our benefits design, we have continued to observe increased care patterns, which may continue in future periods.

We also observed an upshift in hospital coding intensity and an acceleration in the prescribing of certain high-cost medications in early response to the Inflation Reduction Act (IRA).

We expect these additional factors to continue into future periods.

We endeavor to mitigate those increases by engaging hospitals, physicians and consumers with information and helping them make clinically sound choices, with the objective of helping them achieve high-quality, affordable care.

As a result of the Change Healthcare cyberattack, we incurred medical costs related to the impact of the temporary suspension of some care management activities, impacting our UnitedHealthcare and Optum Health businesses, to help care providers with their workflow processes.

Early in the second quarter we resumed these activities.

For the year ended December 31, 2024, medical costs related to the temporary suspension of some care management activities were approximately $640 million.

Medicaid Redeterminations.

Medicaid redeterminations have impacted the number of people served through our Medicaid offerings, partially offset by an increase in consumers served through our commercial offerings as we endeavor to ensure that people and families have continued access to care.

The Medicaid redetermination process has also caused a timing mismatch between the current health status of people served through Medicaid and state rate updates, which remained well short of current care activity.

We expect this gap between people’s health status and rates will narrow in 2025.

We have observed increased care patterns that are above what we expected and contemplated in our pricing and benefits design.

We have also observed an increase in health care unit costs and in the intensity of services delivered, driven by increases in provider pricing and additional services bundled per visit.

Additionally, the member profile of newly added patients under value-based care arrangements, additional people served by our Medicare Advantage plans in markets where other plans exited, and people served within our individual exchange business have contributed to increased medical costs.

These trends may continue in future periods.

The Inflation Reduction Act (IRA) altered the Medicare Part D model and benefits, shifting more risk to plans, which results in both increased premiums and medical costs.

The IRA also changed the quarterly relationship of medical costs to premiums, altering the seasonal progression and creating a more consistent relationship between medical costs and premiums throughout the year.

We endeavor to mitigate medical cost increases by engaging hospitals, physicians and consumers with information and helping them make clinically sound choices, with the objective of helping them achieve high-quality, affordable care.

Additionally, we have elevated our audit, clinical policy and payment integrity tools to protect customers and patients from unnecessary costs.

Delivery System and Payment Modernization.

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Health plans and care providers are being called upon to work together to close gaps in care and improve overall care quality and patient experience, improve the health of populations and reduce costs.

We are working to accelerate this vision through the innovation and integration of our care delivery models including in-clinic, in-home, behavioral and virtual care, and by using our data and analytics to provide clinicians with the necessary information in order to provide the best possible care in the most cost efficient setting.

We continue to see a greater number of people enrolled in fully accountable value-based plans rewarding high-quality, affordable care and fostering collaboration.

This trend is creating needs for health management services which can coordinate care around the primary care physician, including new primary care channels, and for investments in new clinical and administrative information and management systems, which we believe provide growth opportunities for our Optum business platform.

We are working to accelerate realization of these benefits through the innovation and integration of our care delivery models, including in-clinic, in-home, behavioral and virtual care, and by using our data, analytics and AI to provide clinicians with the information necessary to provide the best possible care in the most cost-efficient setting.

We continue to see a greater number of people enrolled in fully accountable value-based plans that reward high-quality, affordable care and foster collaboration.

This trend is creating needs for health management services that can coordinate care around the primary care physician, including new primary care channels, and for investments in new clinical and administrative information and management systems, which we believe provide growth opportunities for our Optum business platform.

A key focus of our future growth is to accelerate the transition from fee-for-service care delivery and payment models to fully accountable value-based care.

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Medicare Advantage Rates.

Medicare Advantage rate notices over the years have at times resulted in industry base rates well below industry forward medical trend.

For example, the Final Notice for 2024 and 2025 rates resulted in an industry base rate decrease, both of which are well short of what is an increasing industry forward medical cost trend.

The Advance Notice for 2026 rates proposes an industry base rate increase also well short of forward medical cost trend, creating continued pressure in the Medicare Advantage program.

Further, substantial revisions to the risk adjustment model, which serves to adjust rates to reflect a patient’s health status and care resource needs, will result in reduced funding and potentially benefits for people, especially those with some of the greatest health and social challenges.

Medicare Advantage rate notices for numerous years have resulted in industry base rates well below the industry forward medical cost trend.

While the Final Notice for 2026 approached the expected industry forward medical cost trend, the Advanced Notice for 2027 is far below.

Additionally, increased medical costs in 2025, which are expected to continue in future periods, have added to the compounding impact of the previous multi-year rate shortfalls creating sustained pressure on the Medicare Advantage program.

Further, substantial revisions to the risk adjustment model, which serves to adjust rates to reflect a patient’s health status and care resource needs, have resulted and will continue to result in reduced funding and potentially benefits for people, especially those with some of the greatest health and social challenges.

As a result of ongoing Medicare funding pressures, there are adjustments we can make to partially offset these rate pressures and reductions for a particular period.

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• Consolidated revenues grew 12%, UnitedHealthcare revenues grew 16% and Optum revenues grew 7%.

• UnitedHealthcare served 2.1 million more people domestically, driven by growth in commercial offerings, partially offset by the impact of Medicaid redeterminations.

• Earnings from operations of $32.3 billion compared to $32.4 billion last year.

• Diluted earnings per common share was $15.51, impacted by the loss on sale of subsidiary and subsidiaries held for sale.

• UnitedHealthcare served 415,000 more people domestically, driven by growth in fee-based commercial offerings and Medicare Advantage, partially offset by risk-based commercial offerings.

• Earnings from operations of $19.0 billion compared to $32.3 billion last year, impacted by elevated medical cost trend, restructuring and other actions, gains related to business portfolio refinement in 2024, partially offset by net portfolio divestitures in 2025 and decreased impacts related to the Change Healthcare cyberattack.

• Diluted earnings per common share was $13.23.

• Cash flows from operations were $19.7 billion.

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Interest expense (4,002) (3,906) (3,246) (96) 2

Loss on sale of subsidiary and subsidiaries held for sale (8,310) — — (8,310) nm

Loss on sale of subsidiary and subsidiaries held for sale (265) (8,310) — 8,045 (97)

Earnings before income taxes 14,697 20,071 29,112 (5,374) (27)

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Return on equity (c) 12.8 % 15.9 % 27.0 % (3.1) %

nm = not meaningful

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

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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 four quarters of the year presented.

2024 RESULTS OF OPERATIONS COMPARED TO 2023 RESULTS

2025 RESULTS OF OPERATIONS COMPARED TO 2024 RESULTS OF OPERATIONS

Consolidated Financial Results

The increases in revenues were primarily driven by growth in Optum Rx, UnitedHealthcare’s domestic offerings and Optum Health, partially offset by the sale of UnitedHealthcare’s Brazil operations.

The increases in revenues were primarily driven by growth in people served through Medicare Advantage and those with higher acuity needs within Medicaid, growth at Optum Rx and pricing trends.

Medical Costs and MCR

Medical costs increased primarily due to growth in people served through Medicare Advantage and domestic commercial offerings and member mix.

The MCR increased as a result of the revenue effects of the Medicare funding reductions, Medicaid timing mismatch between people’s health status and rates, upshift in hospital coding intensity, specialty pharmaceutical prescribing patterns, member mix and due to incremental medical costs for accommodations made to care providers as a result of the Change Healthcare cyberattack.

Medical costs increased primarily due to the IRA-driven impacts on Medicare Part D plans, elevated medical cost trend and growth in people served through Medicare Advantage and those with higher acuity needs.

The MCR increased as a result of the revenue effects of the Medicare funding reductions, elevated medical cost trend, the member profile of newly added patients under value-based care arrangements, the acceleration of anticipated future losses in 2026 related to certain Optum Health value-based care contracts, decreased favorable development, the impacts of the IRA on Medicare Part D and the impacts of market morbidity changes on our individual exchange offerings, partially offset by the incremental medical costs for accommodations made to care providers in 2024 as a result of the Change Healthcare cyberattack.

Operating Cost Ratio

The operating cost ratio decreased primarily due to operating cost management and gains related to business portfolio refinement, including strategic transactions, partially offset by the impact of our direct response efforts to the Change Healthcare cyberattack and investments to support future growth.

Loss on Sale of Subsidiary and Subsidiaries Held for Sale

On February 6, 2024, the Company completed the sale of its Brazil operations.

During the year ended December 31, 2024, we recorded a loss of $7.1 billion, of which $4.1 billion related to the impact of cumulative foreign currency translation losses previously included in accumulated other comprehensive loss.

In the second quarter of 2024, the Company initiated a plan to sell its remaining South American operations, which were classified as held for sale as of December 31, 2024.

During the year ended December 31, 2024, we recorded a loss of $1.2 billion, of which $855 million related to the impact of cumulative foreign currency translation losses.

The operating cost ratio increased due to gains related to business portfolio refinement in 2024;

investments to support future growth and the impacts of restructuring and other actions;

partially offset by the revenue impacts of government programs, including the IRA-driven impacts on Medicare Part D plans;

operating cost management;

net portfolio divestitures in 2025 and decreased impacts related to the Change Healthcare cyberattack.

The effective income tax rate decreased due to tax benefits having significantly more impact due to lower pre-tax income in 2025, impacts of net portfolio divestitures, and due to non-deductible losses on the sale of subsidiary and subsidiaries held for sale in 2024.

While the effective tax rate decreased due to the factors above, total domestic premium, payroll and other taxes incurred increased primarily due to increased premiums and wages.

These taxes are recorded within operating costs on the Consolidated Statements of Operations.

Reportable Segments

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(in thousands, except percentages) 2025 2024 2023 2025 vs.

Commercial - domestic:

Risk-based 8,165 8,845 8,115 (680) (8) %

Fee-based 21,485 20,885 19,200 600 3

Total commercial - domestic 29,730 27,315 26,685 2,415 9

Total commercial 29,650 29,730 27,315 (80) —

Medicare Advantage 8,445 7,845 7,695 600 8

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Total Community and Senior 20,110 19,615 19,895 495 3

Total UnitedHealthcare - domestic medical 49,345 47,210 46,335 2,135 5

Commercial - global 1,330 5,540 5,360 (4,210) (76)

Total UnitedHealthcare - Medical 49,760 49,345 47,210 415 1

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Medicare Part D stand-alone 2,770 3,050 3,315 (280) (9) %

UnitedHealthcare’s revenues increased due to growth in the number of people served through Medicare Advantage and domestic commercial offerings, partially offset by decreased people served globally due to the sale of the Brazil operations and in Medicaid offerings due to redeterminations.

Earnings from operations decreased due to Medicare Advantage funding reductions, the impacts of Medicaid redeterminations, member mix and incremental medical costs for accommodations to support care providers as a result of the Change Healthcare cyberattack, partially offset by gains related to business portfolio refinement, including strategic transactions, and the growth in the number of people served through Medicare Advantage and domestic commercial offerings.

Total revenues increased due to growth at Optum Rx and Optum Health.

Earnings from operations increased with growth at Optum Health and Optum Rx, partially offset by decreased earnings from operations at Optum Insight.

South American businesses held for sale 1,160 1,330 5,540 (170) (13) %

UnitedHealthcare’s revenues increased due to the IRA-driven impacts on Medicare Part D plans and growth in the number of people served through Medicare Advantage, fee-based commercial offerings, those with higher acuity needs and Medicaid rates, partially offset by a decrease in people served through risk-based commercial offerings and Medicaid offerings.

Earnings from operations decreased primarily due to the impacts of Medicare Advantage funding reductions, elevated medical cost trend, gains related to business portfolio refinement in 2024, the impacts of market morbidity changes on our individual exchange offerings, other write-offs and settlements, and restructuring and other actions, partially offset by the incremental medical costs for accommodations to support care providers in 2024 as a result of the Change Healthcare cyberattack.

Total revenues increased primarily due to growth at Optum Rx, partially offset by Optum Health.

Earnings from operations decreased due to Optum Health and Optum Insight, partially offset by Optum Rx.

The results by segment were as follows:

Revenues at Optum Health increased primarily due to organic growth in patients served under value-based care arrangements.

Earnings from operations increased due to gains related to business portfolio refinement, including strategic transactions, increased investment income and cost management initiatives, partially offset by Medicare Advantage funding reductions, costs associated with serving newly added patients under value-based care arrangements and medical care activity.

Revenues at Optum Health decreased primarily due to the conversion of risk-based contracts to fee-based, Medicare Advantage funding reductions and the profile of members served, partially offset by growth in patients served under value-based arrangements.

Earnings from operations decreased due to Medicare Advantage funding reductions;

elevated medical cost trends;

the member profile of newly added patients under value-based care arrangements;

the impacts of restructuring and other actions, including the establishment a loss contract reserve related to anticipated future losses in 2026 for certain value-based care businesses;

gains on dispositions in 2024;

impacts of net portfolio divestitures in 2025;

and reduced investment income;

partially offset by cost management initiatives and incremental medical costs for accommodations to support care providers in 2024 as a result of the Change Healthcare cyberattack.

Optum Health served approximately 95 million people as of December 31, 2025 compared to 100 million people as of December 31, 2024.

Optum Insight

Revenues at Optum Insight decreased primarily due the business disruption impacts from the Change Healthcare cyberattack, partially offset by growth in technology services.

Earnings from operations decreased primarily due to direct response costs and business disruption impacts related to the Change Healthcare cyberattack, partially offset by gains related to business portfolio refinement, including strategic transactions.

Revenues and earnings from operations at Optum Rx increased due to higher script volumes from both new clients and growth in existing clients and growth in pharmacy services.

Earnings from operations also increased due to operating cost efficiencies and supply chain initiatives.

Revenues increased due to decreased impacts related to the Change Healthcare cyberattack and growth in technology services, partially offset by lower volumes within business services.

Earnings from operations decreased due to gains related to business portfolio refinement in 2024, lower volumes within business services and the impacts of restructuring and other actions, partially offset by decreased impacts related to the Change Healthcare cyberattack.

Revenues at Optum Rx increased due to higher script volumes from both new clients and growth in existing clients and growth in pharmacy services.

Earnings from operations increased due to the impacts of net portfolio divestitures, including a gain recognized on the deconsolidation of a business, and the factors impacting revenue, partially offset by restructuring and other actions and decreased investment income.

Optum Rx fulfilled 1,659 million and 1,623 million adjusted scripts in 2025 and 2024, respectively.

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Our regulated subsidiaries generate significant cash flows from operations and are subject to, among other things, minimum levels of statutory capital, as defined by their respective jurisdictions, and restrictions on the timing and amount of dividends paid to their parent companies.

regulated subsidiaries paid their parent companies dividends of $9.2 billion and $8.0 billion in 2024 and 2023, respectively.

regulated subsidiaries received capital infusions, net of dividends, of $535 million and paid their parent companies dividends, net of capital infusions, of $9.2 billion in 2025 and 2024, respectively.

See Note 10 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data” for further detail concerning our regulated subsidiary dividends.

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827 1,846 1,353 (1,019)

Customer funds administered

Cash received for dispositions 561 2,041 685 (1,480)

Sales and maturities of investments, net of purchases 361 525 — (164)

Repayments of care provider loans - cyberattack 1,680 4,514 — (2,834)

Customer funds administered 366 — — 366

Other 63 — — 63

Total sources of cash 24,281 47,790 35,386 (23,509)

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Purchases of redeemable noncontrolling interests (165) (280) (730) 115

Loans to care providers - cyberattack, net of repayments (4,519) — — (4,519)

Loans to care providers - cyberattack — (9,033) — 9,033

Originations and purchases of loans, net of repayments and maturities (2,815) (1,569) (1,051) (1,246)

Customer funds administered — (1,560) (521) 1,560

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40 (61) 97 101

Net increase in cash and cash equivalents, including cash within businesses held for sale $ 104 $ 2,062 $ 1,990 $ (1,958)

cash within businesses held for sale (219) — — (219)

Net (decrease) increase in cash and cash equivalents, including cash within businesses held for sale $ (592) $ 104 $ 2,062 $ (696)

net increase in cash within businesses held for sale (355) (219) — (219)

Net (decrease) increase in cash and cash equivalents $ (947) $ (115) $ 2,062 $ (915)

2025 Cash Flows Compared to 2024 Cash Flows

Decreased cash flows provided by operating activities were primarily driven by CMS Medicare funding reductions, Change Healthcare cyberattack response actions, increased medical costs and changes in working capital accounts.

Other significant changes in sources or uses of cash year-over-year included increased net issuances of short-term borrowings and long-term debt, net sales and maturities of investments and cash received from dispositions, offset by loans to care providers in response to the Change Healthcare cyberattack, increased cash paid for acquisitions and other transactions, decreased customer funds administered and increased share repurchases.

Decreased cash flows provided by operating activities were driven by decreased cash flows from net earnings, partially offset by changes in working capital accounts, the impact of the sale of receivables and the impacts of the Change Healthcare cyberattack in 2024.

Other significant changes in sources or uses of cash year-over-year included the net impacts of loans to care providers in response to the Change Healthcare cyberattack, decreased cash paid for acquisitions and other transactions, decreased common share repurchases and increased customer funds administered, offset by decreased net issuances of short-term borrowings and long-term debt, decreased cash received from dispositions, increased net originations and purchases of loans and decreased proceeds from common stock issuances.

Financial Condition

As of December 31, 2024, our cash, cash equivalent, available-for-sale debt securities and equity securities balances of $77.1 billion included $25.3 billion of cash and cash equivalents (of which approximately $800 million was available for general corporate use), $46.9 billion of debt securities and $4.9 billion of equity securities.

As of December 31, 2025, our cash, cash equivalent, available-for-sale debt securities and marketable equity securities balances of $74.7 billion included $24.4 billion of cash and cash equivalents (of which approximately $1.1 billion was available for general corporate use), $48.2 billion of debt securities and $2.1 billion of marketable equity securities.

Additionally, we had $9.7 billion of loan receivables as of December 31, 2025.

Given the significant portion of our portfolio held in 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.

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• Purchase and other obligations.

These include $11.5 billion, $2.4 billion of which is expected to be paid within the next twelve months, of fixed or minimum commitments under existing purchase obligations for goods and services, including agreements cancelable with the payment of an early termination penalty, and remaining capital commitments for venture capital funds, strategic transactions and other funding commitments.

These include $8.1 billion, $2.5 billion of which is expected to be paid within the next twelve months, of fixed or minimum commitments under existing purchase obligations for goods and services, including agreements cancelable with the payment of an early termination penalty, and remaining capital commitments for venture capital funds and other funding commitments.

These amounts exclude agreements cancelable without penalty and liabilities to the extent recorded in our Consolidated Balance Sheets as of December 31, 2025.

• Put and Call Options.

See Note 12 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data” for further detail.

• Other liabilities.

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Ratings Outlook Ratings Outlook Ratings Outlook Ratings Outlook

Senior unsecured debt A2 Stable A+ Stable A Stable A Stable

Senior unsecured debt A2 Negative A+ Negative A Negative A- Stable

Commercial paper P-1 n/a A-1 n/a F1 n/a AMB-1 n/a

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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.

Regulatory Capital.

As a result of an increased MCR impacting our regulated insurance and HMO subsidiaries, the specified levels of required statutory capital required to be maintained are expected to increase.

We have entered into various agreements with reinsurers that could limit our risk of loss under certain circumstances, thus reducing our capital and surplus requirements.

These agreements do not qualify for reinsurance accounting and are therefore accounted for under deposit accounting.

Share Repurchase Program.

In June 2024, our Board of Directors amended our share repurchase program to authorize the repurchase of up to 35 million shares of Common Stock, in addition to all remaining shares authorized to be repurchased under the Board’s 2018 renewal of the program.

As of December 31, 2025, we had Board of Directors’ authorization to purchase up to 21 million shares of our common stock.

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For more information on our share repurchase program, see Note 10 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”

In June 2024, our Board of Directors increased the Company’s quarterly cash dividend to shareholders to an annual rate of $8.40 compared to $7.52 per share.

In June 2025, our Board of Directors increased our quarterly cash dividend to shareholders to an annual rate of $8.84 compared to $8.40 per share.

For more information on our dividend, see Note 10 of the Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data.”

Pending Acquisitions.

As of December 31, 2024, we have entered into agreements to acquire companies in the health care sector, subject to regulatory approval and other customary closing conditions.

The total anticipated capital required for these acquisitions, excluding the payoff of acquired indebtedness, is approximately $4 billion.

We do not have other significant contractual obligations or commitments requiring cash resources.

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A large number of factors can cause the medical cost trend to vary from our estimates, including:

our ability and practices to manage medical and pharmaceutical costs, changes in level and mix of services utilized;

our ability and practices to manage medical and pharmaceutical costs;

changes in level and mix of services utilized;

mix of benefits offered, including the impact of co-pays and deductibles;

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(in millions)

The completion factors and medical costs PMPM trend factors analyses above include outcomes considered reasonably likely based on our historical experience estimating liabilities for incurred but not reported benefit claims.

Management believes the amount of medical costs payable is reasonable and adequate to cover our liability for unpaid claims as of December 31, 2024;

however, actual claim payments may differ from established estimates as discussed above.

The completion factors and medical cost PMPM trend factors analyses above include outcomes considered reasonably likely based on our historical experience estimating liabilities for incurred but not reported benefit claims.

Management believes the amount of medical costs payable is reasonable and adequate to cover our liability for unpaid claims as of December 31, 2025, but actual claim payments may differ from established estimates as discussed above.

Assuming a hypothetical 1% difference between our December 31, 2025 estimates of medical costs payable and actual medical costs payable, 2025 net earnings would have increased or decreased by approximately $300 million.

20 unchanged sentences

We have not made any adjustments to decrease a discount rate below the calculated peer company weighted average cost of capital for any reporting unit.

Company-specific adjustments to discount rates are subjective and thus are difficult to measure with certainty.

Reporting unit-specific adjustments to discount rates are subjective and thus are difficult to measure with certainty.

The passage of time and the availability of additional information regarding areas of uncertainty with respect to the reporting units’ operations could cause these assumptions to change in the future.

5 unchanged sentences

Investments in financial instruments such as marketable securities and accounts receivable may subject us to concentrations of credit risk.

Our investments in marketable securities are managed under an investment policy authorized by our Board of Directors.

This policy limits the amounts which may be invested in any one issuer and generally limits our investments to U.S.

government and agency securities, state and municipal securities and corporate debt obligations of investment grade.

Our investments in marketable securities are managed under an investment policy authorized by the Audit & Finance Committee of the Board of Directors.

The investment policy establishes defined limits on credit quality, security selection, and permissible asset classes to ensure a disciplined and risk-appropriate investment approach.

Concentrations of credit risk with respect to accounts receivable are limited due to the large number of employer groups and other customers constituting our client base.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis