Dive Brief:
UnitedHealth has selected company veteran Tim Noel to serve as CEO of its insurance business UnitedHealthcare, replacing former top executive Brian Thompson, who was killed last month in New York City.
Noel has been with UnitedHealth for almost two decades, most recently as chief executive of UnitedHealthcare’s Medicare and retirement division.
Noel steps into the role at a pivotal time for UnitedHealthcare, as the insurer grapples with public criticism and shrinking margins from offering Medicare and Medicaid coverage.
Dive Insight:
Noel’s appointment comes seven weeks after Thompson was killed outside of a hotel in Manhattan where UnitedHealth held its annual investor conference. Thompson had been with UnitedHealth since 2004 and led UnitedHealthcare since 2021.
The shocking shooting unleashed a torrent of anti-insurer sentiment online, with people celebrating Thompson’s killing on social media and sharing stories of delayed or denied medical care. The public reaction raised concerns about executive safety, prompting top insurers to remove executive information from webpages and industry conferences to bolster security.
In comments following Thompson’s killing, insurance executives have attempted to acknowledge the widespread discontent with the healthcare industry. During a conference call last week to discuss UnitedHealth’s financial results for the fourth quarter, CEO Andrew Witty said the company will try to improve processes that cause member dissatisfaction, like claims processing and procedure approvals.
“We recognize there’s still a lot of work to be done,” Witty said.
Much of that work will be led by Noel as the new head of UnitedHealthcare, which, with 50.7 million members, is the largest private insurer in the U.S.
Noel “brings unparalleled experience to this role with a proven track record and strong commitment to improving how health care works for consumers, physicians, employers, governments and our other partners,” a UnitedHealth spokesperson said in an emailed statement.
Noel has been with UnitedHealth since 2007. Before his promotion Thursday, he oversaw a segment of the business that includes UnitedHealthcare’s Medicare Advantage plans.
MA is a controversial privatized alternative to traditional Medicare coverage. Previously, MA was a source of considerable profit for insurers, but has become less lucrative over the past few years as seniors used more care and the Biden administration cracked down on overpayments.
UnitedHealthcare is the largest MA insurer, with 7.8 million people in the plans.
The company has also struggled with falling profitability in its Medicaid plans. Millions of Americans were removed from the safety net program starting in 2023 during a process called unwinding, which those who remained skewing sicker and therefore more costly to insure. Payers have accused states of moving slowly to hike rates to cover the higher expense.
UnitedHealth reported a record $400.3 billion in revenue last year. However, its net income of $14.4 billion was the least since 2019, amid insurance pressures and costs of recovering from a massive cyberattack on subsidiary Change Healthcare.
