UnitedHealth Group Incorporated (UNH) Q4 2017 Earnings Conference Call Transcript

UnitedHealth Group, Inc. (NYSE: UNH)Q4 2017 Earnings Conference CallJanuary 16, 2018, 8:45 a.m. ET

Prepared Remarks:

Operator

Good morning. I will be your conference operator today. Welcome to the UnitedHealth Group Fourth Quarter and Full Year 2017 Earnings Conference Call. A question-and-answer session will follow UnitedHealth Group's prepared remarks. As a reminder, this call is being recorded. Here is some important introductory information.

This call contains forward-looking statements under U.S. Federal Securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. A description of some of the risks and uncertainties can be found in the reports that we file with the Securities and Exchange Commission, including the cautionary statements included in our current and periodic filings. This call will also reference non-GAAP amounts. A reconciliation of the non-GAAP to GAAP amounts is available on the financial reports and SEC filings section of the Company's Investors page, at www.unitedhealthgroup.com. Information presented on this call is contained in the earnings release we issued this morning and in our Form 8-K dated January 16, 2018, which may be accessed from the investors' page of the company's website.

I would now like to turn the conference over to the Chief Executive Officer of UnitedHealth Group, Mr. David Wichmann. Please go ahead.

David Wichmann -- Chief Executive Officer

Good morning, and thank you for joining us today. This morning, we reported 2017 results that are ahead of the outlook we shared with you at our investor conference at the end of November. Full year 2017 revenues exceeded $201 billion, increasing more than $16 billion year-over-year. Operating cash flows grew to $13.6 billion and adjusted earnings per share grew 25% to $10.07 per share, with operating earnings from both UnitedHealthcare and Optum ahead of the forecast we provided at our conference.

We had an active December on the growth front. We wrapped up the fourth quarter, serving the benefit needs of nearly one-half million more consumers, completing another successful sales season in individual groups, MA, and dual special needs plans as we turn into 2018, and advancing our strategic positions in two of five growth categories by signing both Benmedica and DaVita Medical Group while maintaining our operating focus to both close 2017 strongly. We expect to carry that momentum into a healthy start to 2018.

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We know the effects of tax changes for 2018 are top of mind for many, so we will begin there today with corporate tax reform. Our starting point for determining our approach was with our mission, helping people live healthier lives and helping make the health system work better for everyone, and our recognition of the enormous gap between where healthcare is today and where it could and should be. We concluded that our ambitions for better health and a better health system are best achieved through investment in ways that will make healthcare far more affordable and of far higher quality.

More specifically, corporate tax reform is expected to improve earnings and cash flows by $1.7 billion in 2018. That's after an estimated $400-500 million reduction in premium revenues due to minimum loss ratio and lower net health insurers fee recapture effects, and a $200-300 million additional investment in operating costs as we accelerate existing initiatives in artificial intelligence, data analytics, individual health record custodianship, digital health, net promotor score improvements, and health related initiatives in local communities.

We expect to invest the remaining increased cash flows to better fulfill our mission and, in turn, to grow and diversify our enterprise for the long-term, all aligned to the ambitious agenda we discussed with you on Investor Day.

We now expect adjusted 2018 earnings of $12.30-12.60 per share, and cash flows from operations in the range of $15-15.5 billion. John Rex will offer more details later in this call and, as usual, we will be available by phone throughout the day.

Before leaving taxes, I would note that we continue to advocate strongly for a multiyear deferral and ultimately the repeal of the health insurance tax given its high cost to consumers and society. If a deferral for 2018 occurs, we plan to return the value to those impacted by the tax.

As highlighted in our investor conference, we are pursuing growth and diversification in five keys areas: healthcare delivery, pharmacy care services, consumers centered benefits, digital healthcare, and global. Our busy December helped us to advance these goals.

The combination of OptumCare with DaVita Medical Group establishes primary and ambulatory healthcare delivery in several new local care markets for OptumCare. Through Benmedica and with Amil and America's Medical Services in Brazil, we are establishing a foundation for growth in South America for decades to come.

And as Steve Nelson will discuss, UnitedHealthcare's 2018 growth in individual and group Medicare Advantage, and dual special needs plans, should again lead the market.

Now, let's turn to the businesses, starting with Optum's Chief Executive, Larry Renfro.

Larry Renfro -- Vice Chairman and Chief Executive Officer, Optum

Thank you, Dave. Delivery strong results for Optum customers in 2017 enabled us to drive strong revenue and earnings growth, and to create opportunities for further growth into 2018. Full year 2017 Optum revenues increased 9%, exceeding $91 billion. 2017 earnings from operations grew by nearly $1.1 billion, or 19%, with individual businesses earnings growth rates ranging from 16-28%.

We again balanced innovation investments in our businesses and strategic acquisitions with business simplification and focused cost management. The result is improved margin performance. Our full year operating margin expanded by 70 basis points to 7.4%, including 9.1% in the fourth quarter.

The fourth quarter earnings from operations grew by more than 20% for every reporting business. We enter 2018 with positive indicators for our business outlook. OptumHealth served 91 million people at year end. Strong 10% growth on a large and growing base.

In the fourth quarter, OptumRx fulfilled 333 million adjusted scripts and OptumInsight advanced its backlog, producing full year backlog growth of 19% to $15 billion.

Our strategic relationships continued to advance as we became more deeply involved with an increasing number of sophisticated customers. Let me give you a few highlights. In state government services, West Virginia became the first state to engage Optum to integrate program eligibility across all state sponsored health benefit programs. Over half the state population, or about 900,000 people will access Medicaid as well as other human services benefits through Optum's new integrated eligibility platform.

We expect to build on our strong and differentiating capabilities, serving health plans. Our health plan customer's members are patients who receive quality care from our physicians at local clinics and ambulatory sites and services. We had strong growth in data analytic work related to risk and quality, and we received a multiyear award to manage the technologies platform modernization for Triple-S Blue Cross Blue Shield Puerto Rico.

The Healthcare Transformation Alliance relationship is off to an excellent start with ten companies selecting OptumRx, driven by their interest in quality, cost transparency, and total cost management.

Finally, with the full implementation for Quest Diagnostics completed at exceptional performance levels, we now manage more than $65 billion in annual billings on behalf of our diverse revenue management customers and the new client pipeline is vibrant.

Acquisitions this past year added market leading platforms, strengthening our capabilities and depth or resources. Surgical Care Affiliates, with its leading ambulatory surgical care practice grew revenue 7% on the same store basis, driven by ever more complex surgical procedures shifting to non-hospital settings. We plan to accelerate thinner development in 2018 and 2019.

We expanded OptumCare primary care driven practices into ten new major metropolitan areas. This includes our pending acquisition of DaVita Medical Group. There are more than 2,000 employees or affiliated physicians serving two million patients annually. Like our OptumCare doctors, DMG physicians are well known for delivering high quality care to their patients and are seasoned in working in a value based care context on behalf of a diverse group of the most respected payers.

Combined with DMG, OptumCare will be in 35 local care delivery markets, nearly one half of the 75 markets targeted for engagement or development. And these market operations are still in the early stages of growth and development, a fraction of the size they are targeted ultimately to be. And we combined with the Advisory Board, the market leader in healthcare research, consulting, and technology. We expect the outcome to bring further resources, capabilities, and value, serving the 4,000 hospitals and health systems that comprise the Advisory Board's membership, and we look forward to accelerating their engagement in the next six months.

Finally, we continue to innovate to better serve market needs. We doubled the number of people with Rally IDs in 2017, now, more than 15 million while administering more than $400 million in consumer incentives. Market interest for this type of scale tested solution is growing.

A large local health plan selected Rally as its consumer technology platform and several renowned hospitals are now using Rally for everything from searching for a physician to pricing the appointment and appointment scheduling.

We launched PreCheck MyScript, connecting patients, physicians, and health plans with useful information at the point of prescribing right in the physicians' workflow. PreCheck MyScript has already been used by tens of thousands of prescribers for nearly 1.5 million transactions. We will offer it to all OptumRx members, expecting to reach 80% of active prescribers by the end of 2019.

We unified our unique data science and analytics capabilities under the OptumIQ brand. We are optimistic about our current progress and our long-term opportunities to continue to advance MPS, to raise quality, to innovate, and develop and grow relationships, making the healthcare system work better for everyone.

Optum was built over 20 years, but we are only just beginning to get a glimpse of its potential. Now, let me turn it over to Steve Nelson, the CEO of UnitedHealthcare.

Steve Nelson -- Chief Executive Officer, UnitedHealthcare

Thank you, Larry. Like Optum, we're pleased to report strong growth and performance across our businesses on behalf of those that we serve. UnitedHealthcare's 2017 revenues exceeded $163 billion and grew 10% year-over-year. Three of our four businesses posted percentage growth rates in the mid-teens or higher, and employer and individual offerings performed exceptionally well, growing 9% absent the $5.3 billion negative impact of reduced participation in ACA individual insurance products and the 2017 health insurance tax moratorium.

Medical costs were well managed for the year, and our full year medical care ratio was near the lower end of our original forecast. The full year 2017 commercial medical cost trend was about 5.5% and we continue to forecast the trend of 6%, plus or minus 50 basis points for 2018.

Operating costs were well controlled in 2017 as operating margins strengthened 30 basis points to 5.2%, with fourth quarter operating margin seasonally lower as expected. We improved our positioning for 2018 and for the long-term. Together with Optum, we renewed early the AARP relationship, a key long-term positive for growth serving the seniors community.

We also strengthened our ability to address the social determinants of healthcare, to better serve people with complex needs. And, we're seeing strong interest from multisite employers in the NexusACO product, the first national ACO product targeted to large self-funded customers looking for higher quality and cost performance. NexusACO leverages UnitedHealth premium physicians to achieve cost savings of up to 15% as customers see reductions in readmissions, ER visits, in patient lengths of stay, and hospital admissions.

We expanded into several new markets, including the western slope of Colorado and upstate New York, and will enter Minnesota and the Northern Plains in the second half of 2018. We begin to advance the next generation of digital health and wellness management, which is available for seniors based on connected wearable devices and wireless technology. Participants in the UnitedHealthcare Motion Wellness Program have used activity trackers to walk 65 million miles, earning nearly $20 million in incentives to cover out of pocket medical expenses.

In 2017, we served two million more people in the U.S. employer group, Medicare, and Medicaid market segments, including almost one-half million more people in the fourth quarter. In Medicaid, we grew by more than 800,000 people in 2017, reflecting entries into new states, support for 110,000 more dual special needs plan members, and a significant late year expansion in Iowa.

In 2018, we expect further growth from our 2017 entries into California and Virginia, from further acceleration in serving dual needs special plans and from continued end market organic growth. The Medicaid pipeline for 2019 and beyond continues to be robust as states increasingly look to manage care for innovation, effective service, and cost containment.

In Medicare, we served nearly one million more seniors in 2017, and we again expect strong growth in 2018, consistent with our expectations. Based on performance in the annual enrollment period, high customer retention, and continued success serving employer group retirees through our national four-star quality plan.

And UnitedHealthcare employer and individual commercial group full risk offerings groups served 130,000 more people this quarter and 465,000 over the past year. We expect some modest pullback in membership in the first quarter, followed by sequential quarterly growth over the balance of the year, led by strength and small group fully in line with our investor conference growth projections.

In global, our Brazil businesses had strong positive 2017 performance and carried that momentum into 2018. We expect to add Benmedica in the first quarter 2018. Benmedica is a provider of healthcare services and health benefits in Chile, Columbia, and Peru, serving 2.1 million people and operating 13 hospitals with 1,900 beds at 143 medical centers.

In many ways, the growth opportunities apparent in these South American markets are reminiscent of the opportunities in healthcare markets in the U.S. two decades ago when consumers and benefit sponsors were seeking better managed benefits and access at lower costs, Medicare Advantage plans and managed Medicaid were nascent, and Part B did not exist. We expect opportunities for growth in these markets to advance as they have in the past two decades, or more, in the U.S.

Our 2017 growth and our 2018 outlook demonstrate the competitive value our offerings bring to consumers and the market. Rising rates of customer retention and strong new business generation reflect the sustaining value of innovative benefit and network designs, improved service, rising MPS, distinguished clinical engagement, and effective cost control.

Now, I'll turn the call over to John Rex, UnitedHealth Group's Chief Financial Officer.

John Rex -- Executive Vice President and Chief Financial Officer

Thank you, Steve. We delivered strong, well balanced performance again in 2017. Consolidated revenues exceeded $201 billion. Cash flow from operations were $13.6 billion. Adjusted earnings per share of $10.07 increased 25% on top of 25% earnings growth in 2016.

We revalued our U.S. deferred tax liabilities to reflect the newly enacted federal statutory rate of 21%, which added $1.2 billion in non-cash earnings in 2017. We have excluded this from adjusted earnings per share. Our expectations for 2018 have been revised solely to reflect the lower expected tax rate, now approximately 24%, the incremental investments Dave referred to and items such as rebate obligations related to loss ratio requirements triggered by the lower tax rate.

The change effects several line items, which I will step through. We now expect adjusted net earnings per share of $12.30 to $12.60 in 2018, with cash flows from operations rising $1.7 billion from our prior outlook to a range of $15-15.5 billion. Dave referenced the $400-500 million impact on premium revenues, which we expect to accommodate within the existing $223-225 billion revenue range we set at our November investor conference.

We now expect UnitedHealth Group earnings from operations to be in the range of $16.7-17.3 billion in 2018. This is reduced by $700 million from the prior range, roughly $400-500 million of which is driven by the premium affects of the new lower tax rate, with greater than half attributed to a lower insurer's fee gross up.

The other factor within this $700 million reflects the end year P&L impact from the investments Dave noted to better serve people and improve the healthcare system, while strengthening our growth and innovation value.

We expect these accelerated investments will result in $200-300 million in incremental operating expense. Our current plans, while still maturing, allocate these investments to both business, learning toward Optum. We now expect our 2018 medical care ratio to run in a range of 81.5%, plus or minus 50 basis points, with the midpoint increasing as much as 30 basis points from our prior outlook, again driven solely by mechanics related to the tax rate change. In addition, with these impacts, we expect our 2018 operating cost ratio to run in a range of 15.3%, plus or minus 30 basis points, with a midpoint 10 basis points above our prior outlook.

With respect to our overall capital position and outlook, we expect to continue to follow our long-standing approach to capital allocation. This includes maintaining a consistent approach of investing in the business and returning capital to shareholders, steadily pacing toward a market rate dividend while targeting a debt to total capital ratio in the 40% range over the long-term.

All of the above is contained in the revised 2018 guidance table included in our supplemental information package this morning. The takeaways are that we enter 2018 with growth and earnings momentum and strong financial flexibility, a significantly improved cash flow outlook, and a debt to total capital ratio below 39% at year end 2017, with clear opportunities to put capital to work. Dave?

David Wichmann -- Chief Executive Officer

Thank you, John. 2017 was a strong year for UnitedHealth Group by virtually every measure: top line growth, rising MPS, strengthening culture and service, strategic advances, operational execution, and as a result, strong financial performance. We are entering 2018 with solid momentum and a clear direction and much to get done.

We plan to sustain this ambitious pace, most importantly because our mission and culture and those we serve require it. Our goal remains realizing the full growth service and social potential of this remarkable enterprise. Thank you for your investment and interest in support of that goal.

...

We will now open the call for questions, asking you to limit to one question a piece so we can get to as many as possible.

Questions and Answers:

Operator

[Operator instructions] We'll take our first question from Justin Lake with Wolfe Research. Please go ahead. Your line's open.

Justin Lake -- Wolfe Research -- Analyst

Thanks. Good morning. I appreciate some of the detail on tax reform. I just want to drill down here a little bit more. First, you talked about the $400-500 million and most of that, or more than half of that, being from the health insurer free impact. I think it's pretty clear that the gross up that Medicaid -- the states would require to give you back needs to be smaller because taxes go down. But, beyond that, can you help us understand how much that is of the half or more that's $400-500? How much is commercial and how much is Medicare that you might've passed through, which I assume is zero on Medicare.

And then, more importantly, for 2019, I would love to hear your thoughts on the sustainability of the tax reform benefit that you're seeing here in 2018, including any differentiation on that sustainability by business. Thanks.

David Wichmann -- Chief Executive Officer

I appreciate it, Justin. We'll have John Rex give you a little bit more details on the impact of the $400-500 million on premiums. As it relates to 2019, we're not in a position to give elemental guidance at this stage. I understand the question, but I hope you can also appreciate that, as is always the case with respect to market dynamics, particularly in a commercial market, with respect to pricing, it's subject to a number of variables, including negotiation and attribution of cost. Not to belittle it at all, but it's not as simple as applying math.

This is something, though, that, as the year progresses, and we see what happens with the health insurance tax, we will be very deliberate in making sure we quantify the effects of that and do so in the context of giving you guidance for 2019. John, do you want to discuss the $400-500, please?

John Rex -- Executive Vice President and Chief Financial Officer

Yeah, good morning. Let me just give a little more background on that how that works just for the benefit of everyone on the call. When we look through how this works through our P&L, the larger component is the impact of the lower premium gross-ups, that federal tax rate decline. Remember the health insurance tax is nondeductible. That results in a gross upon the premium line and that flows through the P&L and effects a number of ratios, as you heard me describe this morning across the P&L.

So, as a result of the gross up, the pre-tax operating earnings, of course were impacted. As that requirement declines, it's netural on the after-tax earnings line, but it impacts pre-tax. So, that's really what we were attempting to go through here. I think you spotlighted one of the easiest to understand ones in terms of some of our state program arrangements here, where when we went into this, the arrangements with the states were explicitly around being made whole for the tax grossed up because of the nondeducibility.

So, that has an explicit impact as that declines. Some of those state arrangements are explicitly that way, so when we go to collect that, we'll be collecting a grossed-up rate of 21%. There are other businesses where that has an impact to contractual arrangements. I'm not going to parse them out in terms of specific amounts for each one, but you're right about how that impact flows through.

Justin Lake -- Wolfe Research -- Analyst

To confirm, in Medicare, I think you guys talked about the gross up not having -- you never passed it through to consumers via lower benefits? So, that doesn't need to be given back? Is that correct? And then, on commercial, how much of commercial do you expect to give back over time, and how much is already in this number? Thank you.

David Wichmann -- Chief Executive Officer

Well, Justin, as it relates to Medicare in particular, that's all subject to a discussion with CMS and a negotiation that occurs in connection with the offering of the annual benefits. Our goals are always to maintain as much consistency as possible in benefit offerings, network access, pharmacy offerings, and formulary as much as possible to keep those benefits as stable as can be. That's one of the leading contributors to a very strong net promotor score with that population.

So, again, our goals there are to maintain as much stability as possible. As it relates to the market, if you think about what we have here, we have two businesses. One is regulated and one is unregulated. The regulated business tax, if you will, we have a detected value of that. A good chunk of that goes back to the market through these recapture mechanisms that we've outlined this morning. That's the $400-500 million that John described.

In addition to that, we thought it would be best that we then invest in things that we know happen to be through our P&L, in this case areas that we know where we can improve healthcare quality and reduce healthcare costs in the future. That's the $200-300 million that John described as well. The vast majority of the residual is either attributed to the Optum business and/or we felt was best and most appropriate for us to invest in continuing to advance healthcare quality and reduce healthcare costs. We really aimed at trying to achieve this mission around helping people and helping to improve health systems.

So, that's where we're at today. We think it's a fair balance. We think that balance is something that's sustainable over the long haul.

Justin Lake -- Wolfe Research -- Analyst

Thanks.

Operator

We'll take our next question from Dave Windley with Jefferies. Please go ahead.

Dave Windley -- Jefferies -- Analyst

Hi. Good morning. In your OptumHealth buildout, I'm curious to what extent, or how far along are we in the process, of your benefit designs on the UnitedHealthcare side, including some type of favorability for your OptumHealth networks. Is that something you can do now? Is it something that you plan to do? Is it something that you need to build more critical mass in OptumCare before you can get there? If you're building a plan that helps the healthcare system to work better, I would think you would want to favor that and wonder how much you're doing that?

David Wichmann -- Chief Executive Officer

Dave, it's one of those things that's often misunderstood about our OptumCare platform. That is a multi-payer platform that serves 80-plus payers broadly. The dynamics around its offerings to the market, particularly around pricing, are negotiated, including with UnitedHealthcare, there is no favoritism applied other than what you would characterize as normal dynamics in a marketplace.

So, our intention is to provide a broad offering and engage the ambitions of all payers so that we can serve more patients. But, Andrew, do you want to touch on some of our strategies there and how we're advancing that business?

Andrew Hayek -- Chief Executive Officer, OptumHealth

Yeah. Thanks, Dave. We are very much committed at Optum and OptumCare to a multi-payer strategy and serving multiple payers in the markets we serve is integral to our business models, including our medical groups, our IPAs, our ambulatory surgery centers, and our neighborhood care centers. So, we work to earn and maintain the trust and confidence of our payer partners around the country and we do that by providing outstanding value to their members and the communities we serve in terms of quality based experience and impacting the total cost of care.

If you look at the track record that we have as we add IPAs, medical groups, SCAs, and MedExpress, we have continued the multi-payer strategy of those entities. In fact, we worked very carefully with each of those payer partners to expand those relationships and continue to serve them and help their success.

David Wichmann -- Chief Executive Officer

So, Dave, it's fair to say that those that get kind of closest to OptumCare -- the payers that do -- are the ones that get best value out of it. Certainly, UnitedHealthcare works very collaboratively with OptumCare, but several of our payer customers do as well.

Dave Windley -- Jefferies -- Analyst

Thank you.

Operator

We'll go next to Matthew Borsch with BMO Capital Markets.

Matthew Borsch -- BMO Capital Markets -- Analyst

Thank you. I was hoping that you could just talk about medical trend from a couple of different dimensions. Number one, to understand is your outlook for going back up the 6% range versus 5.5% that you experienced this year. Is that just the conservatism that we've seen from UNH over the last several years, or is there something specific? I guess, related to that, is what you think the impact to the economy is here and if you're surprised at all by the 2017, which if anything seemed like a softening of trend relative to the prior year.

Sorry, if I could just fit this one in, then that begs a question of the pace of benefits change and the high deductible plan impact in this mix.

David Wichmann -- Chief Executive Officer

That's a lot, Matt, and we'll try to get all of those answered. As it relates to medical trend in 2017, our teams work very hard to control healthcare costs. Usually, our forward view of trend is comprehensive and also reflects a deep respect for the healthcare economy and the ways trends develop over time. But, I think our teams did a really nice job of continuing to mitigate a trend for 2017, and I've taken a prudent approach for 2018 and beyond.

Do you want to talk at all about how trend has advanced year-over-year and maybe what some of the elemental items are, Jeff Putnam?

Jeff Putnam -- Chief Financial Officer, UnitedHealthcare

Yeah, thanks for you question. We're now at 5.5%, so right at the low end of the range from a year ago that we laid out, but completely in line with our investor conference. It reflects, as Dave mentioned, our efforts to manage costs and improve quality and we continue to do that through things like ensuring the right level of care at the right place of service, the effectiveness of our clinical model, alignment with our provider partnerships, and we've seen the improvements broad based across our categories.

I wouldn't point to anything specific or the economy especially around that as well. As of 2018, we're always respectful of trend, and there's nothing we've seen as we closed out 2017 that would change our view at this point for 2018.

Matthew Borsch -- BMO Capital Markets -- Analyst

What about the pace of benefit change and how that's obviously played a role as you've moved more employers to high deductible plans? Is that continuing at the same rate going into this year?

David Wichmann -- Chief Executive Officer

Dan Schumacher, comment on that.

Dan Schumacher -- Chief Financial Officer, UnitedHealthcare

Good morning, it's Dan. If you look at the benefits, a couple of dimension to it. If you look at deductibles, they're rising a little bit faster in 2018 as compared to the rate of increase in 2017 and, in part, due to the reintroduction of the insurer's fee that's pushing pricing up and is putting some pressure on employers to make more adjustments to their benefit. If you look at aggregate buydowns, I think those are relatively comparable year-over-year. But, if you just look at the proportion of people that are buying and choosing more progressive plan designs, I would say that has been a long-standing trend that continues in '18 just the same as it was in '17.

Matthew Borsch -- BMO Capital Markets -- Analyst

Thank you.

Operator

We'll take our next question from Steven Cano with Goldman Sachs. Please go ahead.

Steven Cano -- Goldman Sachs -- Analyst

Thanks. I wanted to just touch on the $400-500 million of minimum MLR rebates. I'm curious to understand whether that had anything to do with pricing plans for the old tax regime and what that could mean for '19. And, relatedly, on the incremental investment side of things, these were described as accelerated programs in the release and I'm wondering if you could give some flavor for how much flexibility that might enable for 2018 and looking into 2019 as well.

David Wichmann -- Chief Executive Officer

Maybe we'll have John Rex address the core part of that question and then I'll wrap up on the investments.

John Rex -- Executive Vice President and Chief Financial Officer

Yeah. Let me just get back to that. To be clear here, on the $400-500 million, that's comprised of two components. The minimum MLR rebate component of that is less than half of that component. The greater component has to do with just really the lower premium gross ups as the federal tax rate declines. I just want to be really clear on that, in terms of how that works. So, minimum MLRs, less than half of that $400-500 million, it's really just the mechanical impact, the recapture impact, on the lower premium gross up that is the majority of the $400-500 million. Dave will address the investments.

David Wichmann -- Chief Executive Officer

We really have investment occurring on two fronts. One, is as it relates to the $200-300 million going through the P&L, and that's the one you're picking up on. A lot of those investments through the P&L are in the application of technology, if you will, across the business. In order the accomplish a number of things, it's to both improve the quality of our services to people, which includes the advancing of our MPS ambitions, which I think we've laid out pretty strongly, as well as to continue to find ways to improve cost structure, thereby delivering greater value broadly to the health system and to individual consumers within it.

You should look at that as an uptick in the run rate expectations of our level of investment, partly in response to this tax. A rate change, if you will. Beyond that, is the balance, which is the $1.7 billion or so of improved cash flows in the business. In that, you'll see us align more quickly and strategically in the market to advance things like our care delivery platforms, which we just discussed. As you know, we are not quite midway through the establishment of the foundation of our market presence in local markets, in that business as an example.

Additional investments in technology related platforms to advance things like precision medicine, genomics, and things of that nature, where we believe we can apply our capacities as an organization are some of the areas you'll see us advance our investment portfolio.

Steven Cano -- Goldman Sachs -- Analyst

Got it. Thank you.

Operator

The next question comes from Michael Baker with Raymond James.

Michael Baker -- Raymond James -- Analyst

Thanks a lot. Just trying to get a sense of the size of the PBM pipeline of opportunities this year compared to last year, and if you could give a little bit of color on market segments that are more active, that would be helpful.

David Wichmann -- Chief Executive Officer

We've seen nice growth in the PBM boat this year, including growth within our customer base. We have a nice pipe for 2019. John Prince?

John Prince -- Chief Executive Officer, OptumRx

So, we just finished up a really strong year. We hit our new business targets. We also had really good retention. As I talked about at Investor Day, we were at almost 98% in terms of our retention. We've seen solid growth, both with our existing client base, including health plans -- so, really broad-based growth across all market segments for 2018.

In terms of 2019, I think it's still early. We have a really good pipeline, so I'd say our pipeline year-over-year is pretty similar. But, it's actually still early. We have some wins for when we're in '19 already, so we're seeing strong active growth in the market. And, I'd say the big deals we won't care about until the end of the first quarter. So, strong pipeline, good growth. I don't see any changes in terms of what market segments are selling more than others right now.

Our value story in the market is really resonating. We're seeing strong interest from sophisticated buyers that are attracted to our pharmacy care services model.

Michael Baker -- Raymond James -- Analyst

Thanks for the update.

Operator

The next question comes from A.J. Rice with Credit Suisse. Please go ahead.

A.J. Rice -- Credit Suisse -- Analyst

Thanks. I'll just ask about the acquisition pace. It seems like in '17 it accelerated, and certainly, as we went through the year, it seemed to accelerate as we got toward the end. That could be a function of greater availability of deals. It could be a function of an option to build out the infrastructure and you feel more confident that you can integrate a faster pace of deals. It could be the balance sheet is now at your target.

Can you give us a flavor for R&D? Are we in an environment where your acquisition pace is likely to accelerate? And maybe I'll just throw in there an update on the international outlook, since I know both Optum and UHC have pointed to that as a growth area with the Benmedica deal. Maybe that brings it back into focus a little bit.

David Wichmann -- Chief Executive Officer

We really didn't accelerate the pace of our acquisition. It's just coincidental that those two acquisitions happened to come at that time. As indicated, they line up nicely with two of the five growth areas of our business. We've long indicated that we have an interest in measured investments in global and Benmedica allowed us to get into three additional South America markets. We have been studying those markets for about five years, and that allowed us to advance our position there. As you know, we're in an open process right now to close that transaction.

And the other one was the DMG acquisition, which again, I would characterize as more coincidental but highly strategic in terms of our ambitions and interest in building the OptumCare platform overall. So, really no acceleration. You shouldn't infer anything with respect to how we're allocating capital broadly.

I would like to just take a moment to have Molly Joseph, who is our Chief Executive of our International Business UnitedHealthcare International. Maybe just spend a moment on Benmedica and our positioning in South America broadly.

Molly Joseph -- Chief Executive Officer, UnitedHealthcare Global

Let me just offer my perspective on three things related to our global expansion. First, is the business progression we've seen in Brazil. Second, the pending transaction with Benmedica. And then, perhaps, touching on how we view Latin America more broadly.

Brazil -- we started 2017 with pretty ambitious expectations for the business, particularly in the area of margin improvement. That was across, both with our health benefits and our medical delivery businesses. I'm very pleased that we fully executed on that plan. The improvements are really being driven by a combination of a very strong local management team that's focused on innovation and quality, and increasingly the localized application of our enterprise capabilities and competencies in clinical, technology, data, and analytics.

So, we enter 2018 in Brazil with really strong momentum for continued margin expansion and quality advancement, which brings me to Benmedica. Benmedica is an organization that we have known for a very long time. We have studied those markets for a long time. They're a market leader across Chile, Columbia, and Peru in both healthcare benefits and medical delivery. They have a really strong local management team with a proven track record in delivering very consistent high margin growth across both lines of their business and all three of those countries.

Similar to Brazil, we see an opportunity to create value by combining that strong local team and that strong platform with our enterprise capabilities across clinical, technology, and data and analytics. Transaction is currently an open tender process and we would expect to close that yet this quarter.

Getting into our view of Latin America more broadly, we see really attractive healthcare dynamics characterized by a growing demand for affordable private healthcare. Our acquisition of Benmedica will put us in a leading position in four of the largest economies across that region. Collectively, these countries have a population roughly equal to that of the U.S., but perhaps more growth opportunities in these emerging private healthcare markets, as well as a broader longer-term opportunity to serve the systems more holistically by also serving public markets.

So, we think we're really well positioned for value creation over the long horizon and we are focused on bringing value to those markets.

David Wichmann -- Chief Executive Officer

So, we took a little bit of time there because we hadn't had a chance to discuss this at our investor conference. Of course, this came right on the heels of that, as did DMG. As it relates to the international markets, in particular, I just want to stress again that our approaches to deployment of capital to those markets will be measured and we're deeply respectful of the volatility that's inherent in each one of those. Our expectations are that they provide returns that are reflective of those risks and risk profiles that exist in each of those markets.

Not to belabor this, but there is one other acquisition that we had closed, the Advisory Board. I might just ask Larry Renfro to make a few comments on that as well.

Larry Renfro -- Vice Chairman and Chief Executive Officer, Optum

I know this will be something important to you, A.J. The Advisory Board was closed, I think, in the latter part of November. We're in the process of implementing the Optum playbook in terms of integration and alignment, but it's gone extremely well. It's well received in the marketplace and we really believe that this is going to enhance our sales pipeline as well as our sales for 2018. It's a very complimentary business and their management team is strong. It's complimentary to us, we're looking for a lot of good things out of the Advisory Board.

A.J. Rice -- Credit Suisse -- Analyst

Great. Thanks.

Operator

The next question comes from Chris Rigg with Deutsche Bank.

Chris Rigg -- Deutsche Bank -- Analyst

Good morning. I just had a follow-up on the international global strategy. When we think about South America, do you think over time this becomes one cross border enterprise under a unified brand name, or is it a portfolio approach where you'll continue to run both businesses separately for the long-term? Thanks.

David Wichmann -- Chief Executive Officer

Just like North America, South America is an inherently local market. So, in that regard, at least for the time being, we have three very strong brands in Brazil -- Amil and America's Medical Services -- and then in Chile and Columbia and Peru, predominantly Chile, Benmedica is the holding company. But, they also operate with a series of very recognizable local brand names, both in healthcare delivery and healthcare insurance.

So, I think you'll continue to see that posture. To the extent that we need to clarify that, like we've been doing with some branding activity in Brazil this past year, we will do so. But, for the most part, we're deeply respectful of the brand value that these folks have created over time.

Operator

The next question comes from Josh Raskin with Nephron Research.

Joshua Raskin -- Nephron Research -- Analyst

Thanks. Good morning. I wanted to talk a little bit about meds, and I'm curious what percentage of your book today has first dollar coverage. Maybe you could talk about a migration strategy. You've only got one open enrollment period before the changes take effect for 2020, and what's the economics on that switch? I assume the gross margin dollars are higher, but are the returns any better? And lastly, do you think this is a big impact on the industry? A step function for MA in 2020? Or, do you think this is going to be more incremental? Thanks.

David Wichmann -- Chief Executive Officer

As you might suspect, a lot of the growth we see in MA comes from our Medicare supplement products overall. I'll ask Brian Thompson to more specifically respond to your question.

Brian Thompson -- Chief Financial Officer, UnitedHealthcare Medicare & Retirement

Sure. Good morning. I'll start with the last point. I don't see this as a big transformative change. We've seen this and been aware of this change for some years now. We have the vast majority of our business today in first-dollar coverage, but have been very pleased without introduction of what we call the Plan G in the middle of 2017. We are certainly seeing that resonate in the marketplace.

But, in terms of the seniors' perspective, we like the continuation -- and really the collision -- of both the Medicare Advantage and the Medicare Supplement products in the marketplace. It really provides broad, good choices for those who are choosing. Again, as we're selling right now, we're very pleased with the margins on both plans. I don't think there's much to be differentiated in terms of economics of either, but certainly don't see this as a big move over the long term.

Operator

The next question comes from Kevin Fischbeck with Bank of America/Merrill Lynch.

Kevin Fischbeck -- Bank of America/Merrill Lynch -- Analyst

Thanks. I wanted to go back to tax reform and the long-term sustainability of the benefit. I appreciate that things can change over the next year, so you have to watch and wait. I thought that United actually almost literally wrote the book on pricing for membership, although competitors might decide to put that back to the benefits, you obviously don't have to follow suit. I think that would like be used as to how much of the benefit you decided to keep versus not keep.

So, maybe if you could give some perspective on that. And then, if there are any thoughts initially about where you think competition wise there might be more pressure within the business. I would think that most of the Optum businesses would actually probably have less pressure than the health plan businesses. But, I wanted to get your perspective on that.

David Wichmann -- Chief Executive Officer

Sure. As it relates to the $400-500 million, again to reiterate, most of that is a combination of two things. One is a minimum MLR amount that we would need to return to policyholders, if you will. The second relates to the lower tax rate on the health insurance tax.

So, that is what I would characterize as more of a mechanical element in returning those premium values to consumers. As it relates to sustainability, again I would urge you to think about the tax reform affecting our cash flows and earnings in a bifurcated way. One, is as it relates to the services business, as well as all the unregulated aspects of UnitedHealthcare, which are substantive. Those components are the ones that we're retaining and investing, if you will.

And think about the other portion as being that which relates to the regulated entity, of which you can see a substantial dollar amount is being returned to the market. On top of that, we invest in managing healthcare costs better, as well as applying better services. And then, on top of that, invest more fully on what I'll characterize as more substantive or transformative change to improve the health system and our offerings broadly to the marketplace.

In our view, we believe it to be sustainable because of the fact that we have such a substantive amount that's already been reverted back in premium values. Plus, the other changes that we've outlined. So, our intention is, at this stage, from this distance, which is pretty early on, that we've made the right allocations in determining how to best utilize this tax reform value.

Kevin Fischbeck -- Bank of America/Merrill Lynch -- Analyst

Great. Thanks.

Operator

We'll take that question for Gary Taylor with JP Morgan. Please go ahead.

Gary Taylor -- JP Morgan -- Analyst

It looks like the year-to-year revenue growth for OptumRx accelerated sequentially a fair amount and then the OI growth accelerated pretty substantially sequentially as well. I just wondered if you could give us a little more color on that performance.

David Wichmann -- Chief Executive Officer

Sure. John Prince, please?

John Prince -- Chief Executive Officer, OptumRx

Sure. In terms of the acceleration, I think the key driver of that is our strong increase in adjusted scripts. So, if you look at our volume, which is driving our business, our adjusted scrips are up 5%. Our scripts have actually been accelerating all year long, so our script growth was the highest in Q4 versus any other quarter in the year. So, that is really driven by the success we've had in the market in terms of taking on new clients, winning new business, and keeping our existing clients. So, that is the key driver from it.

One other driver from it has also been the specialty pharmacy business. We highlighted at Investor Day that we've been very successful in specialty markets. That's a market where you both win with existing business and also compete in the open market. Our value story has been resonating. Our experience has been very solid, both for members and physicians. So, we've been getting a lot of uptake in our specialty pharmacy business. That all has been driving our overall revenue growth. So, very solid from the business standpoint.

David Wichmann -- Chief Executive Officer

Thank you. We're going to pick up the pace here a little bit to try to get in as many questions as possible.

Operator

We'll take a question from Ralph Giacobbe with Citi. Please go ahead.

Ralph Giacobbe -- Citigroup -- Analyst

Thanks. Good morning. A little bit of time has passed and you've had more time to think about the executive order and lack of individual mandate, do you have any updated thoughts on how disruptive you think that will or won't be? Have you had dialogue with small group book? What's your sense for their appetite to maybe change their approach? Does that at all relate to your commentary on your call around the moment being pulled back in one queue and coming back due to small group? If you could flesh that out as well.

David Wichmann -- Chief Executive Officer

I'll address the executive order, and then I'll have Jeff Alter talk about the market dynamics in a moment. The executive order had three components to it. The one I think has the most initial momentum is around the association health plans. But, we also have HRA and short-term limited duration policy considerations.

What I think is happening across all of these is that the administration is pursuing an expansion of products that are available to consumers in an effort to lead to more participation. I think that will also lead to more insurance market stability broadly. We're supportive of expanding the choice of the offerings that consumers have. I think each and every one of these regulations are geared in that way.

So, we're supportive of these efforts to improve choice and provide access to lower costs alternatives. As you well know, healthcare costs too much and consumers are seeking more affordable options.

We're still reviewing the association health plan rules at this time, and we're not going to speculate on the potential outcomes of regulatory matters. But, I would remind you that we have significant experience and do offer association health plans today, primarily in our individual business and/or operate in markets, like TEOs and others, that have similar characteristics.

It's important that these are designed carefully in order to enhance coverage options and ensure that they don't destabilize other aspects of the insurance market, like the small group market. That's largely where our commentary will be aimed, making sure there are no unintended consequences of these.

With respect to enrollment in the first quarter, Jeff, can you touch on that, please?

Jeff Alter -- Chief Executive Officer, UnitedHealthcare Employer & Individual

Good morning. As you saw, we had another strong quarter of growth at the end of 2017 and that makes a run of 13 consecutive quarters of strong fully insured group growth. When you look at 2018, our outlook is unchanged from our investor conference. It has a market dynamic that has the full introduction of the health insure tax, and that's resulting in much higher premiums and, quite frankly, much higher year-over-year increases for our clients.

With that in mind, we look at our very large one-one enrollment in our larger business. We continue to see small group growth and we believe that, as the year paces, we will return to growth and the remaining three quarters will continue our run of strong growth.

Operator

We'll go next to Zack Sopcak with Morgan Stanley. Please go ahead.

Zack Sopcak -- Morgan Stanley -- Analyst

Good morning. I wanted to ask about your MedExpress Walgreens colocations. I think you were at about 15 sites at your investor day. I'm curious how that's going and how think about it from your perspective? What metrics do you have to see to think about a broader rollout for United and Optum? Thanks.

David Wichmann -- Chief Executive Officer

I know this has gotten a lot of attention here, in particular over the course of the last week or so, with some activity at the JP Morgan conference. I want to keep this in the context. We have about a dozen or so locations that we brought online throughout 2017 and that was to see whether or not a retail site of service -- in this case, with Walgreens -- would be an attractive venue for care delivery.

The results are not near final, but we're hoping that our MedExpress Urgent Care model with an adjunct pharmacy performs as good or better than without, meaning that we can provide more convenient service to consumers at a lower cost and with very, very high levels of quality as MedExpress has reflected in their MPS scores from consumers.

I also want to put it into the context that this is just part of developing an overall higher performing local health system. Just being one component that maybe nested inside a local care delivery market with ambulatory surgical capacities and house calls and things of that nature, this is the future health system that we see delivering considerable value to people.

The other thing I want to emphasize is that we'll evaluate other venues and partners as well. This isn't exclusive to anyone in particular. Our interests are being able to align as productively as possible with others in these local communities to see if we can't deliver additional value to people.

Operator

We'll go next to Ana Gupte with Leerink Partners.

Ana Gupte -- Leerink Partners -- Analyst

Thanks for taking my question. On the providers side of the house, I wanted to see what your thoughts are on your organic strategy and M&A and firstly on the buildout of the OptumCare into 35 and then its target 75 markets? What kinds of competition are you facing with either other plans or private equity or other health systems? How do you become the acquirer of choice? Obviously, you did get the DaVita asset.

David Wichmann -- Chief Executive Officer

I think we're nicely positioned initially here, but we have a long ways to go. But, I'll leave that for Andrew Hayek.

Andrew Hayek -- Chief Executive Officer, OptumHealth

Thanks. First and foremost, we started a strategy to build out OptumCare and high value ambulatory care several years ago. So, we're several years into the strategy. The addition of DMG is another step forward in the process. We're excited about the opportunity to combine with DMG and I would also remind you that we're in the midst of an approval process that's under way.

This step forward for us allows us to combine DMGs outstanding clinicians, local leadership, and national leadership. They've achieved very strong results and stars clinical outcomes and patient experience. Our capabilities and strategies are very complementary. We anticipate that many of DMGs capabilities will make OptumCare stronger. Reciprocally, we believe we can add a lot of value to DMG. By doing this, we enhance the value we provide in the markets we serve.

More broadly, the markets we are targeting and entering have been and remain competitive. We earn the right to partner with medical groups and IPAs, surgery centers, and neighborhood care centers through value. We need to demonstrate our ability to enhance clinical outcomes, the patient experience, and reduce the overall cost of care. That is true across OptumCare and each component part.

So, we earn that right to partner and we think, as we continue to grow and enhance our capabilities, we become a more and more attractive partner. Now that we have the ability to combine various ambulatory care assets with the medical group and the IPA, we can address a broader swath of healthcare needs in the marketplace and become an even more attractive partner over time.

David Wichmann -- Chief Executive Officer

It's one of our five areas of key growth in the future. This one is in very early stages. It feels like we are assembling relatively quickly. But, it's one thing to enter into the market. It's another thing to apply information technology and enable these health systems to be strong performers and make a difference on the cost and quality consumers receive in those markets. So, more to come over the coming years on this strategy as we continue to roll it out.

Operator

We'll go next to Frank Morgan with RBC Capital Markets. Please go ahead.

Frank Morgan -- RBC Capital Markets -- Analyst

Good morning. For several quarters now, you've called out the growth in the behavioral health services as one of your drivers of growth inside of OptumHealth. Could you give us any additional color on that growth area -- what specific services, inpatient, outpatient, and what particular markets? Is it more of a government or Medicaid product?

And then one is a clarification. I think you said on surgical care it's 7% growth. Is that organic? Also, could you break out price versus volume?

David Wichmann -- Chief Executive Officer

That is a same store growth rate, as we described, but Andrew oversees all of those business. Andrew Hayek?

Andrew Hayek -- Chief Executive Officer, OptumHealth

Sure. I'll start with SCA. The 7% is our same site net patient revenue growth. That's how we measure organic growth at SCA for several years. That's the combination of volume and rate, keeping in mind that a total joint replacement could take a couple of hours and reimburse $20,000 and a pain injection could take 10 or 12 minutes and reimburse less than $1,000.

So, we use the same site revenue as the organic growth measure. 7% is a very strong number. That's the high end of the range that we have grown over the past several years, and is a reflection of the cumulative impact of the strategy we pursued partnering with health plans, medical groups, and health systems, being very disciplined in shaping our portfolio, the right M&A, as well as some strategic dispositions to make sure we're in the right markets. Focusing on high acuity procedures, ramping up total joints, cardiovascular, complex spine, etc. -- so, we're very pleased with the 7% same site growth rate.

We continue to grow our FDA portfolio. On behavior health, we've had strong performance across the board, including our medical expense, our ability to serve our consumers, including the growing needs of autism and substance abuse disorder. So really, we feel very good about our product and our presence and we continue to ramp up and add external customers and grow in virtually each of the segments that we serve. We feel very good about behavioral and the trajectory that we're on and the prospects for 2018.

Operator

We'll go next to Sarah James with Piper Jaffray.

Sarah James -- Piper Jaffray -- Analyst

Thank you. Can you speak to the OptumCare ASC surgical trend environment? So, how's the trajectory going this year versus in the past? Are you seeing consumerism in the past total annual surgical demand or is it just backend loading and changing the location of service? And taking it one step further, do your systems allow you to see the impassive inpatient diversion for non UHC members? In the past, you've said that you can track this on the individual member basis on the insurance side. But, I'm wondering [inaudible -- audio cuts out] choosing OptumCare ASC. Can you tell how much of that volume was diverted from inpatient or does the data and technology not currently exist for that?

David Wichmann -- Chief Executive Officer

Andrew again?

Andrew Hayek -- Chief Executive Officer, OptumHealth

Sure. I'd say from a wide lens, stepping back, the ASC environment certainly fits into consumerism. So, over the past several years, with rising membership and high deductible plans, consumers being more aware of various alternative sites of care, and having more financial responsibility for the cost of their care, we've studied this. We hear it anecdotally. Patients are asking more question. They're asking questions of their physician and they are searching more. When they do, the ASC environment for clinically appropriate procedures is a very attractive site based on quality outcomes and the patient experience.

We have a net promoter score of 91 as well as the cost effectiveness of procedures in our setting of care are roughly half to less than half the price of the same procedure in a hospital environment. So, we do fit very well into consumerism. We have some data as well as many, many anecdotes that affirm that consumerism does drive increasing interests in our sites.

In terms of the back ended nature, the years have always been seasonal. That's due to members and patients when they're at the end of the year and they have a deductible that's spent. They would rather get the procedure done by the fourth quarter, before the plan year resets. So, there's nothing new or different about that trend.

In terms of inpatient diversion or share of the market we're receiving, we work with multiple plan partners to measure this in various ways. We have a number of pilots under way with multiple health plan partners to track this and do a better job of capturing the right clinically appropriate procedures. We're making progress. We feel very good about it. And, we're still in the very early days. There are still a lot of opportunities to think about high acuity procedures like total joint replacements, complex spine, cardiovascular procedures -- so we're very optimistic about what the future holds.

Operator

We'll go next to Christine Arnold with Cowen.

Christine Arnold -- Cowen -- Analyst

Hi there. OptumInsight backlogs $15 billion, an uptick nicely in the quarter. Can you talk about the specific areas where you're really seeing traction in OptumInsight and where that backlog's really building?

David Wichmann -- Chief Executive Officer

Eric Murphy?

Eric Murphy -- Chief Executive Officer, OptumInsight

Yeah. To your point, we added $2.4 billion to our backlog during 2017. That's a 19% year-on-year growth, so we're pleased with that performance. We had a strong Q4 in terms of sales, which enabled us to achieve the $15 billion objective. For Q4 sales, the primary contributors to that backlog came through our state government business as well as our ambulatory red cycle business.

In terms of the path forward, we take a very robust pipeline into 2018, which should help us achieve our $17-18 billion guidance that we provided to you during the investor conference.

Operator

We'll go next to Peter Costa with Wells Fargo Securities.

Peter Costa -- Wells Fargo Securities -- Analyst

Thank you. While I appreciate very much that your guidance change only includes tax reform items into the mix, it makes it easier for us, but the fourth quarter looked like it was running ahead of your guidance. In fact, you even called out that the UAC was ahead of your own expectations in the fourth quarter. So, why aren't there other changes to guidance going forward? Does that imply that you're more comfortable at the top end of the range now, or were there some negative things that we should be thinking about that came into play during the quarter?

David Wichmann -- Chief Executive Officer

Really what it's reflective of is that we're maybe 45 days from the time that we had our investor conference and first laid out the depth of our initial guidance overall. We're quite pleased with the performance of the company and how it's advanced through the balance of 2017 and how it's established itself nicely for 2018 and beyond.

At this instance, we didn't think it was appropriate or necessary to reflect any additional guidance changes based upon the core performance of the business. Let us get through a quarter or two here and we'll reevaluate what our expectations are for 2018.

Peter Costa -- Wells Fargo Securities -- Analyst

What was the prior period developed in the fourth quarter, if you don't mind?

David Wichmann -- Chief Executive Officer

John.

John Rex -- Executive Vice President and Chief Financial Officer

It was $200 million.

David Wichmann -- Chief Executive Officer

So, thank you, Peter. To wrap up, in 2017 UnitedHealth Group, Optum, and UnitedHealthcare delivered quality products and services, practical innovation, a better consumer experience, and increasing customer satisfaction. Financial performance was strong, marked first and foremost by distinguished and diversified growth, meeting or exceeding our outlook by virtually every measure, including revenue cash flows and earnings.

We have carried this momentum into 2018 and expect to continue to improve quality and MPS scores and build greater trust and loyalty, enabling continued growth for many years to come. Thank you for your interest today.

...

Operator

And this will conclude today's program. Thanks for your participation. You may now disconnect. Have a great day.

Duration: 77 minutes

Call participants:

David Wichmann -- Chief Executive Officer

Larry Renfro -- Vice Chairman and Chief Executive Officer, Optum

Steve Nelson -- Chief Executive Officer, UnitedHealthcare

John Rex -- Executive Vice President and Chief Financial Officer

Brian Thompson -- Chief Financial Officer, UnitedHealthcare Medicare & Retirement

Eric Murphy -- Chief Executive Officer, OptumInsight

Jeff Putnam -- Chief Financial Officer, UnitedHealthcare

Jeff Alter -- Chief Executive Officer, UnitedHealthcare Employer & Individual

John Prince -- Chief Executive Officer, OptumRx

Dan Schumacher -- Chief Financial Officer, UnitedHealthcare

Andrew Hayek -- Chief Executive Officer, OptumHealth

Molly Joseph -- Chief Executive Officer, UnitedHealthcare Global

Peter Costa -- Wells Fargo Securities -- Analyst

Justin Lake -- Wolfe Research -- Analyst

Dave Windley -- Jefferies -- Analyst

Kevin Fischbeck -- Bank of America/Merrill Lynch -- Analyst

Matthew Borsch -- BMO Capital Markets -- Analyst

Michael Baker -- Raymond James -- Analyst

Gary Taylor -- JP Morgan -- Analyst

Chris Rigg -- Deutsche Bank -- Analyst

Sarah James -- Piper Jaffray -- Analyst

Ana Gupte -- Leerink Partners -- Analyst

Ralph Giacobbe -- Citigroup -- Analyst

Zack Sopcak -- Morgan Stanley -- Analyst

Christine Arnold -- Cowen -- Analyst

A.J. Rice -- Credit Suisse -- Analyst

Joshua Raskin -- Nephron Research -- Analyst

Frank Morgan -- RBC Capital Markets -- Analyst

Steven Cano -- Goldman Sachs -- Analyst

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