UnitedHealth Group (UNH)

OptumHealth

Increased revenues in OptumHealth were driven by new business development in large scale behavioral health programs for state clients offset by a decline in individuals served through commercial products. OptumHealth provided services to approximately 58 million consumers.

Earnings from operations and operating margin decreased due to the decrease in membership described above, decreased investment and other income and a higher mix of lower margin public sector business.

OptumHealth

OptumHealth serves approximately 60 million individuals with its diversified offering of health, financial and ancillary benefit services and products that assist consumers in navigating the health care system and accessing services, support their emotional health, provide ancillary insurance benefits and facilitate the financing of health care services through account-based programs. OptumHealth seeks to simplify the consumer health care experience and facilitate the efficient and effective delivery of care. Its capabilities can be deployed individually or integrated to provide comprehensive, consumer-focused health and financial well-being solutions.

OptumHealth’s simple, modular service designs can be easily integrated to meet varying health plan, employer, payer, public sector and consumer needs at a wide range of price points. OptumHealth offers its products on an administrative fee basis where it manages and administers benefit claims for self-insured customers in exchange for a fixed fee per individual served, and on a risk basis, where OptumHealth assumes responsibility for health care in exchange for a fixed monthly premium per individual served. For its financial services offerings, OptumHealth charges fees and earns investment income on managed funds.

OptumHealth’s products are distributed through the three strategic markets: the employer market for both UnitedHealth Group customers and unaffiliated parties; the payer market for Health Care Services health plans, independent health plans, third-party administrators and reinsurers; and the public and senior markets for Medicare and state Medicaid offerings through partnerships with Ovations, AmeriChoice and other intermediaries. Approximately 50 percent of the consumers that OptumHealth serves receive their major medical health benefits from a source other than UnitedHealth Group.

OptumHealth is organized into four major groups: Care Solutions, Behavioral Solutions, Specialty Benefits and Financial Services.

Care Solutions. Care Solutions serves approximately 40 million people through personalized health management solutions that improve the health and well-being of members, improve clinical outcomes and work force productivity, and reduce costs for customers. It delivers its services through the use of evidence-based best practices and technology. Its clinically focused product portfolio includes programs focused on disease management, care advocacy, wellness and complex condition management, such as cancer, solid organ transplant, infertility and congenital heart disease. To support its complex condition management programs, Care Solutions negotiates competitive rates with medical institutions that have been designated as “Centers of Excellence” based on their satisfaction of clinical standards, including patient volumes and outcomes, medical team credentials and experience, and patient and family support services.

Care Solutions also provides benefit administration and clinical and network management for chiropractic, physical therapy, occupational therapy and other complementary and alternative care services through its national network consisting of approximately 23,000 chiropractors, 15,000 physical and occupational therapists and 7,000

6

Table of Contents

complementary and alternative health professionals. Care Solutions also offers treatment decision support, consumer health information, private health portals and consumer health marketing services to address daily living concerns and assist individuals in accessing the health care system.

Behavioral Solutions. Behavioral Solutions serves 43 million individuals with its employee assistance programs, work/life offerings, and clinically driven behavioral health, substance abuse and psychiatric disability management programs. Its consumer-focused programs employ predictive modeling, outcomes management, supportive coaching and evidenced-based best practices to assist individuals in managing stress, depression, substance abuse and other personal challenges while seeking to increase overall health, wellness and productivity. Its outreach programs promote timely detection and intervention to optimize the treatment for people struggling with both psychological and medical conditions. Behavioral Solutions customers have access to a national network of approximately 83,000 clinicians and counselors and approximately 2,500 facilities in 4,600 locations.

Specialty Benefits. Specialty Benefits includes dental, vision, life, critical illness, short-term disability and stop loss product offerings delivered through an integrated platform that enhances efficiency and effectiveness. Approximately 15 million individuals receive their vision benefits through Specialty Benefits and its network of approximately 30,000 vision professionals in private and retail settings. Dental benefit management and related services are provided to six million consumers through a network of approximately 110,000 dentists. Stop-loss insurance is marketed throughout the United States through a network of third-party administrators, brokers and consultants.

Financial Services. Financial services are provided through OptumHealth Bank and OptumHealth Financial Services (formerly known as Exante Bank and Exante Financial Services, respectively). As of December 31, 2008, Financial Services had approximately $660 million in assets under management. Financial Services provides health-based financial services for consumers, employers, payers and health care professionals. These financial services include HSAs, HRAs, and Flexible Spending Accounts offered through OptumHealth Bank, a Utah-chartered industrial bank. Financial Services’ health benefit card programs include electronic systems for verification of benefit coverage and eligibility. Financial Services also provides electronic payment and statement services for health care professionals and payers. In 2008, Financial Services electronically transmitted $26 billion in medical payments to physicians and other health care providers.

OptumHealth

Increased revenues in OptumHealth were driven by rate increases for medical cost inflation and an increased number of consumers served by this segment. OptumHealth provided services to approximately 60 million consumers at December 31, 2008, an increase of approximately 1 million individuals year-over-year.

Earnings from operations and operating margin decreased due to the increased costs for risk-based behavioral and specialty benefits businesses and the mix of continued growth in lower margin business.

OptumHealth

The OptumHealth revenues increase was principally driven by an increase in the number of individuals served by several of its specialty benefit businesses and rate increases related to these businesses.

OptumHealth earnings from operations increased in 2007 primarily due to the membership growth and rate increases. The OptumHealth operating margin declined from 18.6% in 2006 to 18.2% in 2007 due to a continued business mix shift toward higher revenue, lower margin products, partially offset by effective operating cost management.

OptumHealth

OptumHealth revenues for the three and nine months ended September 30, 2008 were $1.3 billion and $3.9 billion, respectively, an increase of $55 million, or 4%, and $253 million, or 7%, over the comparable 2007 periods. The higher revenues were driven by premium rate increases for medical cost inflation and an increased number of consumers served by this segment. OptumHealth provided services to approximately 60 million consumers at September 30, 2008, an increase of approximately 1.1 million individuals year-over-year.

Earnings from operations for the three and nine months ended September 30, 2008 were $175 million and $541 million, respectively, a decrease of $49 million, or 22%, and $115 million, or 18%, over the comparable 2007

36

Table of Contents

periods, due to the increased costs for risk-based behavioral and specialty benefits businesses and the mix of continued growth in lower margin business. OptumHealth’s operating margins for the three and nine months ended September 30, 2008 were 13.5% and 13.8%, respectively, representing a decrease of 460 basis points and 410 basis points from the comparable 2007 periods, driven by the factors that decreased earnings from operations described previously.

OptumHealth

OptumHealth revenues for the three and six months ended June 30, 2008 were $1.3 billion and $2.6 billion, respectively, an increase of $84 million, or 7%, and $198 million, or 8%, over the comparable 2007 periods. The higher revenues were driven by premium rate increases for medical cost inflation and an increased number of consumers served by this segment. OptumHealth provided services to more than 60 million consumers at June 30, 2008, an increase of approximately 2.0 million people year-over-year.

Earnings from operations for the three and six months ended June 30, 2008 were $169 million and $366 million, respectively, a decrease of $50 million, or 23%, and $66 million, or 15%, over the comparable 2007 periods, due to the increased costs for risk-based behavioral business and the mix of continued growth in lower margin business. OptumHealth’s operating margins for the three and six months ended June 30, 2008 were 12.8% and 13.9%, respectively, representing a decrease of 490 basis points and 390 basis points from the comparable 2007 periods, driven by the factors that decreased earnings from operations described previously.

OptumHealth

OptumHealth’s revenues for the first quarter of 2008 were $1.3 billion, an increase of $114 million, or 10%, over the comparable 2007 period. The higher revenues were driven by premium rate increases for medical cost inflation and an increased number of consumers served by this segment. OptumHealth provided services to more than 60 million unique consumers as of March 31, 2008, an increase of 2.6 million people year-over-year.

Earnings from operations for the first quarter of 2008 were $197 million, a decrease of $16 million, or 8%, over the comparable 2007 period, primarily due to the decline in risk-based membership at OptumHealth’s largest customer, UnitedHealthcare, as well as the business mix effect from a comparatively increased level of OptumHealth’s slightly lower margin public sector business, and an increased level of operating expenses to support future growth.

34

Table of Contents

OptumHealth

OptumHealth revenues of $4.3 billion increased by $1.2 billion, or 39%, over 2005. Excluding the impact of businesses acquired since the beginning of 2005, revenues increased by 20% over the prior period. This increase was principally driven by an increase in the number of individuals served by several of its specialty benefit businesses and rate increases related to these businesses.

Earnings from operations in 2006 of $809 million increased $235 million, or 41%, over 2005. OptumHealth operating margin was 18.6% in 2006, up from 18.4% in 2005. Realized improvements in operating cost structure and benefits from the integration of PacifiCare specialty operations in 2006 were partially offset by a business mix shift toward higher revenue, lower margin products.

OptumHealth

OptumHealth had revenues for the three and nine months ended September 30, 2007 of $1.2 billion and $3.4 billion, respectively, an increase of $167 million, or 17%, and $471 million, or 16%, over the comparable periods of 2006. These increases were principally driven by strong growth in the number of individuals served as well as rate increases.

Earnings from operations for the three and nine months ended September 30, 2007 of $222 million and $640 million, respectively, increased $24 million, or 12%, and $76 million, or 13%, over the comparable periods of 2006 primarily due to strong growth in the number of individuals served and operational and productivity improvements within OptumHealth’s businesses. OptumHealth’s operating margin of 19.1% and 18.6% for the three and nine months ended September 30, 2007, respectively, decreased from 19.8% and 19.0% in the comparable periods of 2006. The decrease in operating margin reflected a continued business mix shift toward higher revenue, lower margin products.