UnitedHealth Group Reports Record Fourth Quarter and Full Year 2007 Results

Revenues Surpass $75 Billion in 2007
MINNEAPOLIS--(Business Wire)--UnitedHealth Group (NYSE:UNH):

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-- Full Year Adjusted Earnings Per -- Fourth Quarter Earnings Per
Share of $3.50(1), Up 18% Share of $0.92; up 10%
-- Full Year Adjusted Operating -- Fourth Quarter Operating Margin
Margin of 10.6%(1) of 10.9%
-- Full Year Cash Flows of $5.9 -- Fourth Quarter Cash Flows of
Billion $1.1 Billion
-- Full Year Return on Equity of -- Fourth Quarter Return on Equity
22% of 24%
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UnitedHealth Group (NYSE:UNH) achieved record revenues and
earnings in 2007. Revenues exceeded $75 billion and were supported by
expanded operating margins and strong earnings growth.

Stephen J. Hemsley, president and chief executive officer of
UnitedHealth Group, said, "This was a year defined by strong earnings
and financial performance, driven by improved service and operational
execution, and accompanied by ongoing innovation to enhance health
care. We continue to generate value through our balanced, diversified
business strategy, which enables us to contribute meaningful
improvements across the entire health care spectrum."

UnitedHealth Group(R)

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Quarterly and Annual Financial Performance

Three Months Ended Year Ended
--------------------------- --------------------
December September December December December
31, 30, 31, 31, 31,
2007 2007 2006 2007 2006
-------- --------- -------- ----------- --------
Revenues $18.71 $18.68 $18.13 $75.43 $71.54
billion billion billion billion billion
Earnings From $2.04 $2.16 $1.98 $8.03 $6.98
Operations billion billion billion billion(1) billion
Operating Margin 10.9% 11.5% 10.9% 10.6%(1) 9.8%
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UnitedHealth Group Highlights

UnitedHealth Group reported growth in earnings from operations for
all reporting segments in 2007. Fourth quarter results included growth
in earnings from operations for Prescription Solutions, OptumHealth
and Ingenix, while Health Care Services fourth quarter earnings from
operations decreased modestly, as expected.

-- Consolidated revenues for full year 2007 increased $3.9
billion or 5 percent to $75.4 billion. Revenues for every
reporting segment increased in 2007, with particularly notable
growth in Prescription Solutions, Ingenix and AmeriChoice in
Health Care Services. Fourth quarter revenues of $18.7 billion
increased $577 million or 3 percent year-over-year and were
stable sequentially.

-- Full year adjusted earnings from operations of $8.0 billion
advanced 15 percent over 2006 results. Each reporting segment
increased its operating earnings by a double-digit percentage
in 2007, led by Prescription Solutions, up 94 percent, and
Ingenix, up 51 percent. Earnings from operations increased to
$2.0 billion in the fourth quarter, up $57 million or 3
percent over the prior year, and down $117 million or 5
percent sequentially. This decline was entirely due to the
seasonal decrease in Health Care Services fourth quarter
results.

-- Full year adjusted net earnings advanced to $4.766 billion(1),
up $607 million or 15 percent over 2006 results. Fourth
quarter consolidated net earnings increased to $1.216 billion,
up $41 million or 3 percent year-over-year, and decreased $67
million or 5 percent on a sequential quarter basis, as
expected.

-- The full year adjusted operating margin of 10.6 percent
improved 80 basis points from 9.8 percent in 2006, driven by
gains in both the medical care ratio and operating cost ratio.
The consolidated fourth quarter operating margin of 10.9
percent was stable with the fourth quarter of 2006.

-- Full year adjusted earnings of $3.50 per share(1) increased 18
percent from $2.97 per share in 2006 driven by 15 percent
growth in adjusted earnings from operations and a 3 percent
reduction in diluted weighted average shares outstanding.
Fourth quarter earnings per share of $0.92 increased 10
percent from $0.84 in the fourth quarter of 2006, and
decreased 3 cents or 3 percent from the third quarter of 2007,
as expected.

-- Cash flows from operations were 126 percent of net earnings or
$5.88 billion for the year, including $1.07 billion for the
fourth quarter. The timing of state Medicaid program
receivables collections, income tax payments and federal
program payments affected fourth quarter cash flows.

-- The 2007 consolidated medical care ratio of 80.6 percent
decreased 60 basis points from 81.2 percent in 2006 due
largely to improvements in public and senior markets
businesses. The fourth quarter medical care ratio of 79.9
percent was stable compared with 80.0 percent in the fourth
quarter of 2006.

-- Full year favorable development of prior year medical cost
estimates of $420 million in 2007 compares to $430 million in
2006 and $400 million in 2005. During the fourth quarter, the
Company realized favorable development of $70 million in its
estimates of medical costs incurred in 2006. The Company also
realized $10 million in favorable development in the fourth
quarter related to estimates of medical costs incurred in the
first nine months of 2007, with no effect on full year
results.

-- Consolidated medical costs days payable were 57 days for the
fourth quarter of 2007, as compared to 56 days for the fourth
quarter of 2006. Excluding the AARP division of Ovations,
medical costs days payable were 54 days for the fourth quarter
of 2007 and 53 days for the fourth quarter of 2006.

-- The full year adjusted operating cost ratio of 13.8 percent(1)
improved 20 basis points from 14.0 percent in 2006 reflecting
effective operating cost management. Operating costs
represented 14.4 percent of revenues in the fourth quarter,
including about 30 basis points of incremental advertising and
related market launch expenses for the AARP-branded Medicare
Advantage offerings. Excluding these expenses, the fourth
quarter 2007 operating cost ratio was stable with fourth
quarter 2006.

-- The income tax rate of 36.3 percent was consistent for full
year 2007 and 2006. The fourth quarter 2007 income tax rate of
35.5 percent decreased 80 basis points sequentially primarily
due to the mix of profitability among state tax jurisdictions.

-- UnitedHealth Group repurchased 125 million shares in 2007 for
$6.6 billion, including 40 million shares in the fourth
quarter for $2.2 billion.

-- Full year 2007 return on equity exceeded 22 percent, with
fourth quarter 2007 annualized return on equity at 24 percent.
Strong returns on equity were driven by double digit operating
margins and an increasingly efficient capital structure.

As previously disclosed, during the fourth quarter of 2007 the
Company completed the realignment of its business segment financial
reporting. The most prominent changes to segment reporting include
disclosure of the results of operations of the pharmacy benefit
management business - Prescription Solutions - as a free-standing
segment, and the inclusion of the large group, multi-site health
benefits company - Uniprise - as part of the Health Care Services
reporting segment. The fourth quarter and full year 2007 information
reflects this new reporting structure. Historical financial data also
reflect the new segment presentation to enhance comparability between
periods.

Outlook

UnitedHealth Group continues to project earnings of approximately
$3.95 to $4.00 per share for full year 2008, an increase of
approximately 13 percent to 14 percent over adjusted 2007 results, and
cash flows from operations are expected to approach $7 billion. First
quarter 2008 earnings are expected to be in the range of $0.82 to
$0.84 per share.

UnitedHealthcare

Ovations

Uniprise(R)

AmeriChoice

Business Description - Health Care Services

The Health Care Services segment provides a diverse set of
customers with health benefit offerings that address their needs for
greater access to affordable, quality care, and that are supported
through common networks integrated with shared clinical resources.
Within Health Care Services, UnitedHealthcare coordinates
network-based health and well-being services on behalf of small and
mid-sized local and multi-state employers and for individuals, while
Uniprise provides these services on a dedicated basis to large,
multi-site employers. Ovations delivers health and well-being services
to Americans over the age of 50, and AmeriChoice manages health care
services for state Medicaid programs and their beneficiaries.

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Quarterly and Annual Financial Performance

Three Months Ended Year Ended
--------------------------- -----------------
December September December December December
31, 30, 31, 31, 31,
2007 2007 2006 2007 2006
-------- --------- -------- -------- --------
Revenues $17.57 $17.60 $17.13 $71.20 $67.82
billion billion billion billion billion
Earnings From Operations $1.60 $1.79 $1.65 $6.60 $5.86
billion billion billion billion billion
Operating Margin 9.1% 10.2% 9.6% 9.3% 8.6%
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Key Developments for Health Care Services

The fourth quarter for the Health Care Services segment included
important product launch activities for UnitedHealthcare, improving
AmeriChoice financial performance, intensive marketing of Ovations
Medicare Advantage offerings for January 2008, and sequential growth
in fee-based employer-sponsored product lines offset by a decrease in
consumers served under risk-based arrangements.

-- Full year Health Care Services revenues increased $3.4 billion
or 5 percent to $71.2 billion, led by the $1.8 billion advance
in Ovations revenues. Revenues grew $442 million or 3 percent
year-over-year and decreased $31 million sequentially to $17.6
billion in the fourth quarter of 2007. The decrease was
primarily due to the timing of Part D revenue recognition and
routine product and membership reconciliations with the
Centers for Medicare and Medicaid Services, offset by business
growth at AmeriChoice.

-- Full year Health Care Services earnings from operations grew
$735 million or 13 percent over 2006 results due largely to
the strong performance of public and senior markets
businesses. Fourth quarter Health Care Services earnings from
operations of $1.6 billion decreased $50 million or 3 percent
year-over-year and $187 million or 10 percent from third
quarter of 2007. These decreases reflect a seasonally higher
fourth quarter medical care ratio at UnitedHealthcare and
increased market launch, advertising and enrollment costs for
Ovations.

-- Health Care Services full year operating margin of 9.3 percent
expanded 70 basis points year-over-year and decreased 50 basis
points year-over-year and 110 basis points sequentially to 9.1
percent in the fourth quarter of 2007.

-- Full year Ovations revenues of $26.5 billion increased more
than $1.8 billion or 7 percent over 2006 results, with revenue
advances in its AARP Medicare supplement, SecureHorizons
Medicare Advantage, Evercare chronic and elderly, and Part D
businesses. Ovations reported revenues of $6.3 billion in the
fourth quarter, up $109 million or 2 percent year-over-year.
Revenues decreased $87 million or 1 percent from the third
quarter of 2007 due to the timing of Part D revenue
recognition and routine product and membership reconciliations
with the Centers for Medicare and Medicaid Services

-- Ovations saw strong membership growth in its active Medicare
supplement products in 2007, with its membership growing by
125,000 seniors or 5 percent for the full year, including
30,000 seniors or 1 percent growth in the fourth quarter.
Participation in Medicare Advantage offerings was stable in
the fourth quarter and decreased by 75,000 people or 5 percent
in 2007, principally in Private Fee-for-Service products.

-- On October 1, 2007, Ovations launched nationwide marketing for
its Medicare products for 2008. New developments include a
significant expansion of chronic care Special Needs Plan
offerings from seven states to 34 states; new Part D drug
benefits, including zero copay generic prescriptions filled by
mail order; and targeted geographic expansions for Medicare
Advantage programs. Importantly, Ovations network-based
SecureHorizons Medicare Advantage programs are now exclusively
offered on a co-branded basis with AARP for the first time.
Ovations estimates it will add 125,000 to 175,000 seniors in
its Medicare Advantage product lines in 2008.

-- Full year AmeriChoice revenues of $4.5 billion increased $750
million or 20 percent year-over-year, driven by strong organic
growth in people served and moderate increases in premium
yields on a same-state basis. AmeriChoice fourth quarter
revenues of $1.2 billion increased $227 million or 24 percent
year-over-year and $35 million or 3 percent from the third
quarter of 2007.

-- AmeriChoice expanded its services to an additional 245,000
people in 2007, representing a 17 percent increase
year-over-year, including 10,000 people in the fourth quarter.
Growth highlights include the successful initiation of
services to residents of central Tennessee covered by the
TennCare program, expansion in Texas, and new services in
Indiana that became available on January 1, 2008.

-- UnitedHealthcare and Uniprise combined full year revenues of
$40.3 billion increased by $821 million or 2 percent
year-over-year as yield increases more than offset a modest
reduction in people served. Fourth quarter revenues increased
$106 million or 1 percent year-over-year and grew $21 million
sequentially.

-- UnitedHealthcare and Uniprise had a combined decrease of
175,000 people served, or about 0.7 percent, across all
products in 2007, including more than 300,000 people related
to the continued repositioning of the PacifiCare acquisition,
which will continue through the first half of 2008. The full
year results include a decrease of 50,000 people in the fourth
quarter, as growth of 25,000 consumers in fee-based products
was offset by a reduction in risk-based membership of 75,000
people.

-- In 2007 Uniprise and UnitedHealthcare advanced their
leadership position in the consumer-directed health benefit
product market. These businesses served a total of 2.3 million
people through their consumer-directed offerings at December
31, 2007, representing organic growth of 425,000 consumers or
22 percent year-over-year. More than 9 percent of commercial
membership is in one of these plans, with penetration reaching
12 percent for both Uniprise large group and UnitedHealthcare
small business customers. This strong growth has been spurred
by UnitedHealth Group's investment in tools and resources that
engage and support consumers in information gathering and
decision-making, as well as the ability to offer seamless
linkages to health financial services through OptumHealth.

-- The full year UnitedHealthcare medical care ratio of 82.1
percent increased 230 basis points in 2007. As previously
disclosed, this ratio reflects an unfavorable variance in
reserve development between years and a shortfall in realized
premium yield. The Company anticipates this medical care ratio
will be stable in 2008.

-- UnitedHealthcare's fourth quarter 2007 medical care ratio of
83.7 percent compares to a ratio of 81.6 percent in the third
quarter of 2007. The sequential increase reflects higher
seasonal utilization of health care services in the fourth
quarter, as anticipated, as well as an accrual that reduced
premium revenues in the quarter, due to one state's recently
issued regulatory determinations on prior year underwriting
performance.

OptumHealth(SM)

Business Description - OptumHealth

OptumHealth optimizes health, well-being and financial security
for people and organizations through personalized health advocacy and
engagement, specialized benefits such as behavioral, dental and vision
offerings, and health financial services. OptumHealth helps people
improve their lives by making informed decisions about their health
and health care finances.

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Quarterly and Annual Financial Performance
Three Months Ended Year Ended
--------------------------- -----------------
December September December December December
31, 30, 31, 31, 31,
2007 2007 2006 2007 2006
-------- --------- -------- -------- --------
Revenues $1.26 $1.24 $1.11 $4.92 $4.34
billion billion billion billion billion
Earnings From Operations $239 $224 $215 $895 $809
million million million million million
Operating Margin 19.0% 18.1% 19.4% 18.2% 18.6%
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Key Developments for OptumHealth

During 2007, UnitedHealth Group rebranded its specialty businesses
as OptumHealth, reinforcing their personalized, caring and lifelong
relationships with consumers. The unified OptumHealth image better
reflects its comprehensive and integrated capabilities.

-- OptumHealth expanded its market share in 2007 by both
providing services to 2.1 million more people and by
increasing product and service penetration within its
established customer base. Full year OptumHealth revenues of
$4.9 billion increased $579 million or 13 percent, while
fourth quarter revenues rose to $1.3 billion, up $145 million
or 13 percent year-over-year, and $16 million or 1 percent
over third quarter 2007.

-- Full year earnings from operations at OptumHealth grew $86
million or 11 percent year-over-year to $895 million. In the
fourth quarter, earnings from operations of $239 million
increased $24 million or 11 percent year-over-year and
improved $15 million or 7 percent from third quarter 2007.

-- The OptumHealth operating margin of 18.2 percent in 2007
compares to 18.6 percent in 2006. The year-over-year margin
change reflects strong growth from public sector clients that
are contributing relatively larger per client revenues at
comparatively lower overall margins. OptumHealth's fourth
quarter operating margin of 19.0 percent decreased 40 basis
points year-over-year but increased 90 basis points
sequentially. The sequential gain in operating margin was
principally due to effective operating cost management.

-- Optum Financial Services (Exante) reached $460 million in
assets under management and served more than 1.3 million
financial accounts at December 31, 2007. Optum Financial
Services (Exante) moved $19 billion in payments electronically
to health system providers during 2007, representing 80
percent growth in electronic payments year-over-year.

Ingenix(R)

Business Description

Ingenix is a leader in the field of health care data, analysis and
application, serving pharmaceutical companies, health insurers and
other payers, physicians and other health care providers, large
employers and governments.

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Quarterly and Annual Financial Performance
Three Months Ended Year Ended
---------------------------- -----------------
December September December December December
31, 30, 31, 31, 31,
2007 2007 2006 2007 2006
-------- --------- -------- -------- --------
Revenues $414 $344 $301 $1.30 $0.96
million million million billion billion
Earnings From $120 $66 $74 $266 $176
Operations million million million million million
Operating Margin 29.0% 19.2% 24.6% 20.4% 18.4%
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Key Developments for Ingenix

Ingenix continues to build momentum, with strong growth in
virtually every performance metric. This business is responding to the
growing needs for data-driven solutions, analytics and consulting
services by all participants across the health care system. Fourth
quarter results show particularly notable strength due to the seasonal
sales activity that occurs annually in the fourth quarter in certain
Ingenix product lines.

-- On a full year basis, Ingenix grew revenues by $348 million or
36 percent over 2006 results, with strong revenue growth
across every major product line. In the fourth quarter of
2007, Ingenix revenues increased $113 million or 38 percent
year-over-year and $70 million or 20 percent sequentially, to
$414 million.

-- The Ingenix revenue backlog of $1.7 billion at December 31,
2007 increased 46 percent year-over-year, positioning Ingenix
for continued growth performance in 2008.

-- Market demand for newer Ingenix offerings continues to expand.
For example, data interchange volume tripled year-over-year in
the fourth quarter of 2007, and Ingenix nearly doubled its
in-house consulting capacity to more than 1,000 professionals
over the course of the year.

-- Ingenix full year earnings from operations increased $90
million or 51 percent, with fourth quarter earnings from
operations of $120 million, up $46 million or 62 percent
year-over-year and $54 million or 82 percent from third
quarter 2007. The full year 2007 operating margin of 20.4
percent improved 200 basis points over 2006. The fourth
quarter 2007 operating margin of 29.0 percent increased 440
basis points year-over-year and 980 basis points on a
sequential basis, due to seasonal demand for certain
higher-margin Ingenix offerings.

Prescription Solutions(R)

Business Description

Prescription Solutions offers a comprehensive array of pharmacy
benefit management and specialty pharmacy management services to
employer groups, union trusts, seniors through Medicare prescription
drug plans, and commercial health plans.

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Quarterly and Annual Financial Performance
Three Months Ended Year Ended
--------------------------- -----------------
December September December December December
31, 30, 31, 31, 31,
2007 2007 2006 2007 2006
-------- --------- -------- -------- --------
Revenues $3.32 $3.25 $1.05 $13.25 $4.08
billion billion billion billion billion
Earnings From Operations $78 $77 $41 $269 $139
million million million million million
Operating Margin 2.4% 2.4% 3.9% 2.0% 3.4%
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Key Developments for Prescription Solutions

During 2007 Prescription Solutions was established as a
free-standing reporting segment of UnitedHealth Group and continued to
strengthen its capabilities as it positioned for growth.

-- On January 1, 2007, Prescription Solutions began providing
prescription drug benefit services to approximately 4 million
additional seniors on behalf of Ovations. Driven by this
growth, Prescription Solutions revenues increased $9.2 billion
or 224 percent for full year 2007 and $2.3 billion or 215
percent for fourth quarter 2007, reaching $13.2 billion and
$3.3 billion for the respective periods. Because of the
relationship between Ovations and Prescription Solutions,
approximately $9 billion of the full year revenue growth is
eliminated in the intercompany elimination process.

-- Full year earnings from operations grew $130 million or 94
percent to $269 million, with fourth quarter earnings from
operations of $78 million increasing $37 million or 90 percent
over comparable 2006 results. The Prescription Solutions full
year operating margin of 2.0 percent declined 140 basis points
year-over-year, reflecting the comparatively lower margin
earned in the high volume Ovations Part D prescription drug
service contract and, to a lesser extent, costs associated
with positioning the business for continued strong growth. For
similar reasons, the fourth quarter operating margin of 2.4
percent decreased 150 basis points year-over-year and was
stable sequentially.

About UnitedHealth Group

UnitedHealth Group is a diversified health and well-being company
dedicated to making health care work better. Headquartered in
Minneapolis, Minn., UnitedHealth Group offers a broad spectrum of
products and services through seven operating businesses:
UnitedHealthcare, Uniprise, Ovations, AmeriChoice, Prescription
Solutions, OptumHealth and Ingenix. Through its family of businesses,
UnitedHealth Group serves more than 70 million individuals nationwide.
Visit www.unitedhealthgroup.com for more information.

Earnings Conference Call

As previously announced, UnitedHealth Group will discuss the
Company's results, strategy and future outlook on a conference call
with investors at 8:45 a.m. Eastern time today. UnitedHealth Group
will host a live webcast of this conference call from the Investor
Information page of the Company's Web site
(www.unitedhealthgroup.com). The webcast replay of the call will be
available on the same site for one week following the live call. The
conference call replay can also be accessed by dialing 1-800-642-1687,
conference ID #28398813. This earnings release and the Form 8-K dated
January 22, 2008, which may also be accessed in the Investor
Information section of the Company's Web site, include a
reconciliation of non-GAAP financial measures.

Forward-Looking Statements

This press release may contain statements, estimates, projections,
guidance or outlook that constitute "forward-looking" statements as
defined under U.S. federal securities laws. Generally the words
"believe," "expect," "intend," "estimate," "anticipate," "plan,"
"project," "will" and similar expressions, identify forward-looking
statements, which generally are not historical in nature. These
statements may contain information about financial prospects, economic
conditions, trends and uncertainties. We caution that actual results
could differ materially from those that management expects, depending
on the outcome of certain factors. These forward-looking statements
involve risks and uncertainties that may cause UnitedHealth Group's
actual results to differ materially from the results discussed in the
forward-looking statements. Some factors that could cause results to
differ materially from the forward-looking statements include: the
potential consequences of the findings announced on October 15, 2006
of the investigation by an Independent Committee of directors of our
historic stock option practices; the consequences of the restatement
of our previous financial statements, related governmental reviews,
including a formal investigation by the Securities and Exchange
Commission, and review by the Internal Revenue Service, U.S.
Congressional committees, U.S. Attorney for the Southern District of
New York and Minnesota Attorney General, a related review by the
Special Litigation Committee of the Company, and related shareholder
derivative actions, including whether court approval of the settlement
agreements between the Company and certain named defendants and the
dismissal of the derivative claims against all named defendants is
obtained, shareholder demands and purported securities and Employee
Retirement Income Security Act class actions, the resolution of
matters currently subject to an injunction issued by the United States
District Court for the District of Minnesota, a purported notice of
acceleration with respect to certain of the Company's debt securities
based upon an alleged event of default under the indenture governing
such securities, and recent management and director changes, and the
potential impact of each of these matters on our business, credit
ratings and debt; increases in health care costs that are higher than
we anticipated in establishing our premium rates, including increased
consumption of or costs of medical services; heightened competition as
a result of new entrants into our market, and consolidation of health
care companies and suppliers; events that may negatively affect our
contract with AARP; uncertainties regarding changes in Medicare,
including coordination of information systems and accuracy of certain
assumptions; funding risks with respect to revenues received from
Medicare and Medicaid programs; failure to achieve business growth
targets, including membership and enrollment; increases in costs and
other liabilities associated with increased litigation, legislative
activity and government regulation and review of our industry; our
ability to execute contracts on competitive terms with physicians,
hospitals and other service providers; regulatory and other risks
associated with the pharmacy benefits management industry; failure to
maintain effective and efficient information systems, which could
result in the loss of existing customers, difficulties in attracting
new customers, difficulties in determining medical costs estimates and
appropriate pricing, customer and physician and health care provider
disputes, regulatory violations, increases in operating costs, or
other adverse consequences; possible impairment of the value of our
intangible assets if future results do not adequately support goodwill
and intangible assets recorded for businesses that we acquire;
potential noncompliance by our business associates with patient
privacy data; misappropriation of our proprietary technology; failure
to complete or receive anticipated benefits of acquisitions; and
change in debt to total capital ratio that is lower or higher than we
anticipated.

This list of important factors is not intended to be exhaustive. A
further list and description of some of these risks and uncertainties
can be found in our reports filed with the Securities and Exchange
Commission from time to time, including annual reports on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K. Any or
all forward-looking statements we make may turn out to be wrong. You
should not place undue reliance on forward-looking statements, which
speak only as of the date they are made. Except to the extent
otherwise required by federal securities laws, we do not undertake to
publicly update or revise any forward-looking statements.

(1) Further explanations of the non-GAAP measures referred to in
this release and reconciliations to the comparable GAAP measures are
included in the attached financial schedules.

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UNITEDHEALTH GROUP

Earnings Release Schedules and Supplementary Information
Quarter and Full Year Ended December 31, 2007

- Consolidated Statements of Operations

- Condensed Consolidated Balance Sheets

- Condensed Consolidated Statements of Cash Flows

- Segment Financial Information

- Customer Profile Summary

- Reconciliation of Non-GAAP Financial Measures:

- Operating Results Excluding IRS Section 409A Charges

- Consolidated Reporting Excluding AARP
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UNITEDHEALTH GROUP
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(unaudited)

Three Months Ended Year Ended
December 31, December 31,
------------------ -----------------
2007 2006 2007 (a) 2006
--------- -------- -------- --------
REVENUES
Premiums $16,964 $16,565 $68,781 $65,666
Services 1,202 1,090 4,608 4,268
Products 260 221 898 737
Investment and Other Income 279 252 1,144 871
--------- -------- -------- --------

Total Revenues 18,705 18,128 75,431 71,542
--------- -------- -------- --------

OPERATING COSTS
Medical Costs 13,551 13,246 55,435 53,308
Operating Costs 2,698 2,556 10,583 9,981
Cost of Products Sold 211 168 768 599
Depreciation and Amortization 207 177 796 670
--------- -------- -------- --------

Total Operating Costs 16,667 16,147 67,582 64,558
--------- -------- -------- --------

EARNINGS FROM OPERATIONS 2,038 1,981 7,849 6,984

Interest Expense (153) (129) (544) (456)
--------- -------- -------- --------

EARNINGS BEFORE INCOME TAXES 1,885 1,852 7,305 6,528

Provision for Income Taxes (669) (677) (2,651) (2,369)
--------- -------- -------- --------

NET EARNINGS $ 1,216 $ 1,175 $ 4,654 $ 4,159
========= ======== ======== ========

BASIC NET EARNINGS PER COMMON
SHARE $ 0.95 $ 0.87 $ 3.55 $ 3.09
========= ======== ======== ========

DILUTED NET EARNINGS PER COMMON
SHARE $ 0.92 $ 0.84 $ 3.42 $ 2.97
========= ======== ======== ========

Diluted Weighted-Average Common
Shares Outstanding 1,318 1,395 1,361 1,402
========= ======== ======== ========

(a) Includes $87 million of Operating Costs ($55 million after-tax or
$.04 per share) for the settlement of Internal Revenue Code Section
409A (IRS Section 409A) surtax liabilities on behalf of non-officer
employees who exercised certain options in 2006 and 2007, and $89
million of non-cash Operating Costs ($57 million after-tax or $.04
per share) for the modification charge due to repricing unexercised
options subject to IRS Section 409A.

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UNITEDHEALTH GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions)
(unaudited)

December 31, December 31,
2007 2006
------------ ------------

ASSETS
Cash and Short-Term Investments $ 9,619 $10,940
Accounts Receivable, net 1,574 1,323
Other Current Assets 4,351 3,781
------------ ------------

Total Current Assets 15,544 16,044

Long-Term Investments 12,667 9,642
Other Long-Term Assets 22,688 22,634
------------ ------------

Total Assets $50,899 $48,320
============ ============

LIABILITIES AND SHAREHOLDERS' EQUITY
Medical Costs Payable $ 8,331 $ 8,076
Commercial Paper and Current Maturities of
Long-Term Debt 1,946 1,483
Other Current Liabilities 8,215 8,938
------------ ------------

Total Current Liabilities 18,492 18,497

Long-Term Debt, less Current Maturities 9,063 5,973
Future Policy Benefits for Life and Annuity
Contracts 1,849 1,850
Deferred Income Taxes and Other Liabilities 1,432 1,190
Shareholders' Equity 20,063 20,810
------------ ------------

Total Liabilities and Shareholders'
Equity $50,899 $48,320
============ ============

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UNITEDHEALTH GROUP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(unaudited)

Year Ended December 31,
-----------------------
2007 2006
----------- -----------
Operating Activities
Net Earnings $ 4,654 $ 4,159
Noncash Items:
Depreciation and amortization 796 670
Deferred income taxes and other (127) (267)
Stock-based compensation 505 404
Net changes in operating assets and
liabilities 49 1,560
----------- -----------
Cash Flows From Operating Activities 5,877 6,526
----------- -----------

Investing Activities
Cash paid for acquisitions, net of cash
assumed and other effects (262) (670)
Purchases of property, equipment and
capitalized software, net (871) (676)
Net purchases of investments (3,014) (755)
----------- -----------
Cash Flows Used For Investing Activities (4,147) (2,101)
----------- -----------

Financing Activities
Common stock repurchases (6,599) (2,345)
Net change in commercial paper and debt 3,569 577
Customer funds administered (1,110) 1,705
Proceeds from common stock issuances 712 397
Other, net 243 140
----------- -----------
Cash Flows (Used For) From Financing
Activities (3,185) 474
----------- -----------

(Decrease) increase in cash and cash
equivalents (1,455) 4,899
Cash and cash equivalents, beginning of period 10,320 5,421
----------- -----------
Cash and cash equivalents, end of period $ 8,865 $10,320
=========== ===========

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UNITEDHEALTH GROUP
SEGMENT FINANCIAL INFORMATION - 2007 (a)
(in millions)
(unaudited)

REVENUES
--------------------

Year
Three Months Ended Ended
------------------------------------ ---------
March December
31, June 30, September 31, December
2007 2007 30, 2007 2007 31, 2007
-------- -------- --------- -------- ---------

Health Care
Services (b) $18,056 $17,968 $17,603 $17,572 $ 71,199
OptumHealth 1,190 1,237 1,239 1,255 4,921
Ingenix 262 284 344 414 1,304
Prescription
Solutions 3,379 3,304 3,249 3,317 13,249
Eliminations (3,840) (3,793) (3,756) (3,853) (15,242)
-------- -------- --------- -------- ---------

Total
Consolidated $19,047 $19,000 $18,679 $18,705 $ 75,431
======== ======== ========= ======== =========

EARNINGS FROM
OPERATIONS
--------------------

Year
Three Months Ended Ended
------------------------------------ ---------
March December
31, June 30, September 31, December
2007 2007 30, 2007 2007 31, 2007
-------- -------- --------- -------- ---------

Health Care
Services $ 1,458 $ 1,748 $ 1,788 $ 1,601 $ 6,595
OptumHealth 213 219 224 239 895
Ingenix 38 42 66 120 266
Prescription
Solutions 49 65 77 78 269
Corporate (176) - - - (176)(c)
-------- -------- --------- -------- ---------

Total
Consolidated $ 1,582 $ 2,074 $ 2,155 $ 2,038 $ 7,849
======== ======== ========= ======== =========

MEDICAL CARE RATIOS
--------------------

Year
Three Months Ended Ended
------------------------------------ ---------
March December
31, June 30, September 31, December
2007 2007 30, 2007 2007 31, 2007
-------- -------- --------- -------- ---------

UnitedHealthcare 81.2% 82.0% 81.6% 83.7% 82.1%
Commercial Markets 81.8% 82.4% 82.0% 84.1% 82.6%

(a) During the fourth quarter of 2007, we completed the transition
to our new operating structure and business segment financial
reporting. The fourth quarter and full year 2007 information
reflects this new reporting structure. Historical financial data
also reflect the new segment presentation to enhance comparability
between periods.

(b) Revenues for Q107, Q207, Q307, Q407 and full year 2007 were
$10,052, $10,049, $10,083, $10,104 and $40,288 for Commercial
Markets (UnitedHealthcare and Uniprise); $7,026, $6,791, $6,365,
$6,278 and $26,460 for Ovations; and $978, $1,128, $1,155, $1,190
and $4,451 for AmeriChoice, respectively.

(c) Includes $87 million of Operating Costs for the settlement of
Internal Revenue Code Section 409A (IRS Section 409A) surtax
liabilities on behalf of non-officer employees who exercised
certain options in 2006 and 2007, and $89 million of non-cash
Operating Costs for the modification charge due to repricing
unexercised options subject to IRS Section 409A.

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UNITEDHEALTH GROUP
SEGMENT FINANCIAL INFORMATION - 2006 (a)
(in millions)
(unaudited)

REVENUES
---------------------

Year
Three Months Ended Ended
-------------------------------------- ---------
March 31, June 30, September December December
2006 2006 30, 2006 31, 2006 31, 2006
--------- -------- --------- --------- ---------

Health Care
Services (b) $16,696 $16,961 $17,030 $17,130 $67,817
OptumHealth 1,066 1,079 1,087 1,110 4,342
Ingenix 202 210 243 301 956
Prescription
Solutions 953 1,037 1,041 1,053 4,084
Eliminations (1,336) (1,424) (1,431) (1,466) (5,657)
--------- -------- --------- --------- ---------

Total
Consolidated $17,581 $17,863 $17,970 $18,128 $71,542
========= ======== ========= ========= =========

EARNINGS FROM
OPERATIONS
---------------------

Year
Three Months Ended Ended
-------------------------------------- ---------
March 31, June 30, September December December
2006 2006 30, 2006 31, 2006 31, 2006
--------- -------- --------- --------- ---------

Health Care
Services $ 1,247 $ 1,403 $ 1,559 $ 1,651 $ 5,860
OptumHealth 183 201 210 215 809
Ingenix 27 26 49 74 176
Prescription
Solutions 16 37 45 41 139
Corporate - - - - -
--------- -------- --------- --------- ---------

Total
Consolidated $ 1,473 $ 1,667 $ 1,863 $ 1,981 $ 6,984
========= ======== ========= ========= =========

MEDICAL CARE RATIOS
---------------------

Year
Three Months Ended Ended
-------------------------------------- ---------
March 31, June 30, September December December
2006 2006 30, 2006 31, 2006 31, 2006
--------- -------- --------- --------- ---------

UnitedHealthcare 79.4% 79.9% 79.4% 80.4% 79.8%
Commercial Markets 80.1% 80.6% 80.1% 81.0% 80.5%

(a) During the fourth quarter of 2007, we completed the transition to
our new operating structure and business segment financial reporting.
Historical financial data reflect the new segment presentation to
enhance comparability between periods.

(b) Revenues for Q106, Q206, Q306, Q406 and full year 2006 were
$9,752, $9,858, $9,859, $9,998 and $39,467 for Commercial Markets
(UnitedHealthcare and Uniprise); $6,054, $6,205, $6,221, $6,169 and
$24,649 for Ovations; and $890, $898, $950, $963 and $3,701 for
AmeriChoice, respectively.

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UNITEDHEALTH GROUP
CUSTOMER PROFILE SUMMARY - 2007
(in thousands)
(unaudited)

December September June March December
People Served 2007 2007 2007 2007 2006
---------------------------- -------- --------- ------ ------ --------

Commercial Risk-based 10,805 10,880 11,010 11,050 11,285
Commercial Fee-based 14,720 14,695 14,680 14,695 14,415
-------- --------- ------ ------ --------

Total Commercial 25,525 25,575 25,690 25,745 25,700
======== ========= ====== ====== ========

Medicare Advantage 1,370 1,370 1,350 1,340 1,445
Medicaid 1,710 1,700 1,700 1,500 1,465
Standardized Medicare
Supplement 2,400 2,370 2,330 2,315 2,275
-------- --------- ------ ------ --------

Total Public and Senior
(a) 5,480 5,440 5,380 5,155 5,185
======== ========= ====== ====== ========

Total Health Care
Services Medical
Benefits 31,005 31,015 31,070 30,900 30,885
======== ========= ====== ====== ========

Total People Served 70,950 70,990 71,095 70,970 70,680
======== ========= ====== ====== ========

Supplemental Data - included
above

OptumHealth 58,700 58,500 58,100 57,800 56,600
======== ========= ====== ====== ========

Total Part D Prescription
Drug Plans 5,950 5,950 5,890 5,865 5,740
======== ========= ====== ====== ========

Consumer-Directed Health
Plans 2,315 2,290 2,245 2,180 1,890
======== ========= ====== ====== ========

(a) Excludes pre-standardized Medicare Supplement and other AARP
products. These products are included in Total People Served.

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UNITEDHEALTH GROUP
CUSTOMER PROFILE SUMMARY - 2006
(in thousands)
(unaudited)

December September June March December
People Served 2006 2006 2006 2006 2005
---------------------------- -------- --------- ------ ------ --------

Commercial Risk-based 11,285 11,100 11,195 11,205 11,350
Commercial Fee-based 14,415 14,410 14,425 14,295 13,240
-------- --------- ------ ------ --------

Total Commercial 25,700 25,510 25,620 25,500 24,590
======== ========= ====== ====== ========

Medicare Advantage 1,445 1,440 1,425 1,320 1,185
Medicaid 1,465 1,445 1,400 1,380 1,290
Standardized Medicare
Supplement 2,275 2,250 2,225 2,200 2,150
-------- --------- ------ ------ --------

Total Public and Senior
(a) 5,185 5,135 5,050 4,900 4,625
======== ========= ====== ====== ========

Total Health Care
Services Medical
Benefits 30,885 30,645 30,670 30,400 29,215
======== ========= ====== ====== ========

Total People Served 70,680 70,385 70,085 69,220 65,945
======== ========= ====== ====== ========

Supplemental Data - included
above

OptumHealth 56,600 56,300 55,600 55,600 53,900
======== ========= ====== ====== ========

Total Part D Prescription
Drug Plans 5,740 5,745 5,670 4,500 -
======== ========= ====== ====== ========

Consumer-Directed Health
Plans 1,890 1,850 1,800 1,625 1,175
======== ========= ====== ====== ========

(a) Excludes pre-standardized Medicare Supplement and other AARP
products. These products are included in Total People Served.

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UNITEDHEALTH GROUP
Reconciliation of Non-GAAP Financial Measures
Operating Results Excluding IRS Section 409A Charges (a)
(in millions, except per share data)
(unaudited)

Three Months Ended March 31, 2007
------------------------------------
Operating
Results
Excluding
IRS
Section
Consolidated Non-GAAP 409A
GAAP Reconciling Charges
Reporting Items (a)
------------ ------------ ----------
REVENUES
Premiums $17,464 $- $17,464
Services 1,116 - 1,116
Products 197 - 197
Investment and Other Income 270 - 270
------------ ------------ ----------

Total Revenues 19,047 - 19,047
------------ ------------ ----------

OPERATING COSTS
Medical Costs 14,440 - 14,440
Operating Costs 2,664 (176) 2,488
Cost of Products Sold 170 - 170
Depreciation and Amortization 191 - 191
------------ ------------ ----------

Total Operating Costs 17,465 (176) 17,289
------------ ------------ ----------

EARNINGS FROM OPERATIONS 1,582 176 1,758

Interest Expense (116) - (116)
------------ ------------ ----------

EARNINGS BEFORE INCOME TAXES 1,466 176 1,642

Provision for Income Taxes (539) (64) (603)
------------ ------------ ----------

NET EARNINGS $927 $112 $1,039
============ ============ ==========

DILUTED NET EARNINGS PER COMMON
SHARE $0.66 $0.08 $0.74
============ ============ ==========

Diluted Weighted-Average Common
Shares Outstanding 1,399 - 1,399
============ ============ ==========

Medical Care Ratio 82.7% 82.7%
Operating Cost Ratio 14.0% 13.1%
Operating Margin 8.3% 9.2%

Year Ended December 31, 2007
------------------------------------
Operating
Results
Excluding
IRS
Section
Consolidated Non-GAAP 409A
GAAP Reconciling Charges
Reporting Items (a)
------------- ------------ ----------
REVENUES
Premiums $68,781 $- $68,781
Services 4,608 - 4,608
Products 898 - 898
Investment and Other Income 1,144 - 1,144
------------ ------------ ----------

Total Revenues 75,431 - 75,431
------------ ------------ ----------

OPERATING COSTS
Medical Costs 55,435 - 55,435
Operating Costs 10,583 (176) 10,407
Cost of Products Sold 768 - 768
Depreciation and Amortization 796 - 796
------------ ------------ ----------

Total Operating Costs 67,582 (176) 67,406
------------ ------------ ----------

EARNINGS FROM OPERATIONS 7,849 176 8,025

Interest Expense (544) - (544)
------------ ------------ ----------

EARNINGS BEFORE INCOME TAXES 7,305 176 7,481

Provision for Income Taxes (2,651) (64) (2,715)
------------ ------------ ----------

NET EARNINGS $4,654 $112 $4,766
============ ============ ==========

DILUTED NET EARNINGS PER COMMON
SHARE $3.42 $0.08 $3.50
============ ============ ==========

Diluted Weighted-Average Common
Shares Outstanding 1,361 - 1,361
============ ============ ==========

Medical Care Ratio 80.6% 80.6%
Operating Cost Ratio 14.0% 13.8%
Operating Margin 10.4% 10.6%

(a) Excludes charges recorded in the first quarter of 2007 related
to IRS Section 409A stock option matters. This is a non-GAAP
measure that management believes improves the comparability of the
Company's results between periods.

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UNITEDHEALTH GROUP
Reconciliation of Non-GAAP Financial Measures
Consolidated Reporting Excluding AARP (a)
(in millions)
(unaudited)

Quarter Ended
December 31, 2007
----------------------------------
Consolidated
Consolidated AARP Reporting
GAAP Program Excluding
Reporting Balance AARP (a)
------------ -------- ------------
Accounts Receivable, net $ 1,574 $ 459 $ 1,115
Medical Costs Payable $ 8,331 $ 1,109 $ 7,222
Medical Costs $ 13,551 $ 1,177 $ 12,374
Medical Days Payable 57 87 54
Days Sales Outstanding 8 32 6

Quarter Ended
September 30, 2007
----------------------------------
Consolidated
Consolidated AARP Reporting
GAAP Program Excluding
Reporting Balance AARP (a)
------------ -------- ------------
Accounts Receivable, net $ 1,318 $ 461 $ 857
Medical Costs Payable $ 8,370 $ 1,080 $ 7,290
Medical Costs $ 13,500 $ 1,178 $ 12,322
Medical Days Payable 57 84 54
Days Sales Outstanding 7 31 5

Quarter Ended
December 31, 2006
----------------------------------
Consolidated
Consolidated AARP Reporting
GAAP Program Excluding
Reporting Balance AARP (a)
------------ -------- ------------
Accounts Receivable, net $ 1,323 $ 417 $ 906
Medical Costs Payable $ 8,076 $ 1,004 $ 7,072
Medical Costs $ 13,246 $ 1,082 $ 12,164
Medical Days Payable 56 85 53
Days Sales Outstanding 7 31 5

(a) Certain account balances and financial measures have been
presented in this earnings release excluding our AARP business.
Management believes these disclosures are meaningful since
underwriting gains or losses related to the AARP business are
recorded as an increase or decrease to a rate stabilization fund
(RSF) and the effects of changes in balance sheet amounts
associated with the AARP program accrue to the overall benefit of
the AARP policyholders through the RSF balance. Although the
Company is at risk for underwriting losses to the extent
cumulative net losses exceed the balance in the RSF, the Company
has not been required to fund any underwriting deficits to date
and management believes the RSF balance is sufficient to cover
potential future underwriting or other risks associated with the
contract.
*T

UnitedHealth Group
Investors:
Brett Manderfeld, 952-936-7216
Vice President
or
John S. Penshorn, 952-936-7214
Senior Vice President
or
G. Mike Mikan, 952-936-7374
Chief Financial Officer
or
Media:
Don Nathan, 952-936-1885
Senior Vice President

Copyright Business Wire 2008