Performance of the Company Annual Reports Statements Essay

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Performance of the Company

Annual reports

Statements of corporate goals

SWOT analysis of United Health Group

9A PESTEL Analysis

In this paper, we present a systematic analysis of the United Health Group through a SWOT and PESTEL analysis. The analysis is aimed at the identification of an internal problem within the company's environment and then prescribing a suitable solution to it. The identified problem is poor Ergonomics. This is then explored and then recommendations provided.

The creation of a better health care system has been one of the key drivers of change in the American social, economic and political reform agenda. Quality health care to al citizens has been a piped dream for many. In this paper we presents an analysis of the effectiveness of United Healthcare in the provision of quality health care. Our focus is on its environmental analysis with the aim of isolating the genesis of the problems related to poor ergonomics. This is because UnitedHealth Care has 55,000 workers 90% of which are desk-based jobs. Due to this large number of call centers, the company has a deep focus on ergonomic issues. This is driven by the fact that the largest number of the claims that they receive are of repetitive stress (MCDonald,2006)

An overview of the company

UnitedHealthcare is a division of the largest single health carrier in the U.S. called UnitedHealth Group. The company is recognized as a leader in the "well-being" and health industry (UHC,2011a) and its strives to improve the level of effectiveness as well as quality of the healthcare to all the U.S. citizens, enhance the level of access to various health benefits, create products as well as services that are geared towards the making of healthcare more affordable, use various forms of technologies in the making of healthcare system an easier entity to navigate.

The United Health Group has dedicated its efforts to the delivery of innovative products and services to close to 70 million U.S. citizens. Its network is made up of close to 659912 health care professionals, Eighty thousand dentists as well as 5158 healthcare facilities (hospitals). Their pharmaceutical management programs have provided accessible and yet affordable access to various drugs to a staggering 13 million individuals. The company is committed to the delivery of very high quality health care as well as continuous improvement in the same. The UnitedHealth Group has dedicated its efforts in research and development (R&D) as well as business processes aimed at improving various aspects of healthcare provisions within the nation. Its investment in R&D is estimated at $3 billion in a period spanning the last 5-year. This level of investment has lead to a paradigm shift in the way health care is delivered in the entire industry (United Health Group, 2010).United American Healthcare Corporation (UAHC) is a company which is publicly held in the U.S. It is principally engaged in the provision of management as well as consultancy services. The services of which include corporate governance, strategic planning, HR functions, provider credentialing, accounts collection, enrolment, utilization review as well as prenatal care and other care management programs. As pointed out earlier, UnitedHealth Care has 55,000 workers 90% of which are desk-based jobs. Due to this large number of call centers, the company has a deep focus on ergonomic issues. This is driven by the fact that the largest number of the claims that they receive are of repetitive stress (MCDonald,2006)

General performance of the company

UnitedHealthcare was recently awarded the highest level of employer satisfaction rating for the various self-insured plans by J.D. Power and Associates (Reuters,2011). The company also received a very high mark from the American Medical Association (AMA) in the National Health Insurance Report Card (2011) (UHC,2011b). The fourth annual report card in total evaluated 7 national health insurance firms on the basis of accuracy as well as timeline of their processing of claims on the basis of a variety of approval as well as payment metrics. The company moved to the very top position among its competitors on a total of two metrics. These were, the Contracted Fee Schedule Match Rate, a metric use din indicating how often a given payment for a claim by an insurer matches the specified contracted fee schedule as well as the second metric, Remittance Advice (ERA) Accuracy used in measuring the rate at which the allowed amount by the insurer equals the amount that is expected for the physician's practice.

The insurance industry publication called the Business Insurance named the company the winner of 2010 "readers' choice" award for the for "Best health plan provider"(BI,2010).

Organization structure

The organization structure at United Health Care has undergone a series of changes over the years. On the 2nd of July, 2006, the company announced major changes to its organizational structure that were designed to help in the creation of a unified and yet full service brand for the corporation's commercial benefit businesses as well as help in simplifying its communication and interaction with customers, brokers, members and stakeholders (2006).The organizational structure is simple and is made up of close to twenty five executives who are involved in the management of the large corporation. The organizational structure is hierarchical and is top-down in nature. The makings of key decisions are made by the top management at its head offices (headquarters) in Minnetonka, Minnesota, USA. These decisions are then communicated down to the lower management. The organization is mechanistic and operates in a closed system.

Figure 1: United Healthcare Group organizational chart (The, 2011)

Annual reports

A review of the UnitedHealth Group Annual report reveals that it made a revenue of $84B in 2009 and $94B in 2010 (Unite Health Group,2010).This represented an increase of U.S.$7 Billion (8%) from the 2009 revenue. The group achieved a remarkable business growth that cut across each of its segments that are reported and generated an earning of $7.9 billion from its operations.The cash flow from the various operations was $.6.3 billion. This represented 135% of the 2010 net earnings. The dilated earning per common share was pegged at $4.10

Figure 2: A graphic representation of the company's revenue, earnings from operations and operating margin from 2006-2010 (United Health Group,2010).

Problem statement

The Ergonomic Problems at United Health Care

Poor Ergonomics was cited by an anonymous post an employee of the company who complained that "The desks are not ergonomically correct and can create back, shoulder, and elbow pain" (,2010).This points to serious healthcare concerns for the employee and even the patients. The issue of Ergonomic is very important for the healthcare environment (Springer,2008).At UHG, the ergonomic problem affects the employees mostly and to some extent, the patients. UnitedHealth Care has 55,000 workers 90% of which are desk-based jobs. Due to this large number of call centers, the company has a deep focus on ergonomic issues. This is driven by the fact that the largest number of the claims that they receive are of repetitive stress (McDonald,2006)

The need for better ergonomics

A number of studies have been dedicated to the issue of ergonomics in the healthcare settings. Amick et al., (n.d) found out that proper ergonomics lead to better health and increased productivity. MacLeod (2006) also found out that ergonomics can lead to a lot of savings for companies since it will lead to a general reduction of employee compensation, improved productivity, less fatigue and fewer mistakes among others. Amick et al. (2008) also discovered that office ergonomics can lead to a reduction in the musculoskeletal symptoms in workers. DeRango et al. (2002) also found out that office ergonomics training as well as ergonomically designed chair has a productivity consequence. Robertson et al. (2002) also found out that office Ergonomics training is very important in reducing musculoskeletal risk. Before recommending an appropriate plan of action, it is important for an analysis of other aspects of the organization to be carried out.

Computer ergonomics has been indicated historically to be associated with musculoskeletal disorders (MSD), radiation problems and vision problems (Clark,2001). The available research indicated advice and recommendations for products which reduced and even totally eliminated the ergonomic concerns. Despite these improvements, some of the problems associated with poor ergonomics like repetitive stress injuries (RSI) such as carpel tunnel syndrome (CTS), necks and shoulder pain and muscular fatigue still continue to be of great concern to productivity in companies such as United Health Care (McDonald,2006).

The best question to ask ourselves is whether companies such as United Health Group are paying adequate attention to these health concerns. Well a review of extant literature indicates that they do (McDonald,2006) as is evident by their action of designing ergonomically correct workstations which is customized for each and every employee (McDonald,2006). The improvement of the user's work environment has been associated with reduced health risks and improved productivity. These reasons are some of the reasons as to why ergonomics should be given utmost attention by organizations. Timm (2005) indicated that ergonomic problems have continued to escalate with a survey indicating…[continue]

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