UNH · 10-Q · 2026Q1 · Full report

Operating Cost Ratio Increase

UNITEDHEALTH GROUP INC · 2026-05-05 · Importance 60 · Surprise 58

The consolidated operating cost ratio increased to 13.8% in Q1 2026 from 12.4% in Q1 2025, a 1.4 percentage point increase, contributing to a decline in consolidated operating margin to 8.0% from 8.3%. Total operating costs were $102,731 million in Q1 2026 versus $100,456 million in Q1 2025, an increase of $2,275 million. Management attributes the higher operating cost ratio primarily to investments in people, process and technology to improve consumer and provider experiences, business mix shifts and the impacts of restructuring and other actions, partially offset by government program revenue impacts, operating cost management and net portfolio divestitures. These operating cost increases weighed on earnings from operations, which were $8,990 million in Q1 2026 versus $9,119 million a year earlier.

Key facts

• Total operating costs were $102,731 million for the three months ended March 31, 2026 compared to $100,456 million for the three months ended March 31, 2025 (an increase of $2,275 million). source
• Operating cost ratio increased to 13.8% in the first quarter of 2026 from 12.4% in the first quarter of 2025 (an increase of 1.4 percentage points). source
• Operating costs increased by $415 million due to restructuring and other actions in the first quarter of 2026, partially offset by an increase to investment and other income of $74 million and decreased medical costs of $137 million. source
• Operating margin decreased to 8.0% in the first quarter of 2026 from 8.3% in the first quarter of 2025 (a decrease of 0.3 percentage points). source