February 6, 2023

UnitedHealthcare, Canopy Health Come Up With New Health Plan

UnitedHealth Group Incorporated’s UNH business, UnitedHealthcare, recently expanded its relationship with Canopy Health, which is best known for having a high-quality network of providers and health systems offering enhanced healthcare services across the Bay Area.

The latest collaboration has resulted in the development of a health plan — the California Doctors Plan. The plan intends to provide improved health outcomes for individuals coming under employer-sponsored health coverage across nine Bay Area counties: Alameda, Contra Costa, Marin, San Francisco, San Mateo, Santa Clara, Santa Cruz, Solano and Sonoma.

The new health plan not only assures personalized and coordinated healthcare experience for consumers and employers in Northern California but also intends to provide the same services at lower costs.

Case in point, people enrolled in the California Doctors Plan can avail savings of up to 25% on premiums when compared with a traditional PPO offering. It will also offer co-pays for primary care and urgent care at free of cost and telehealth visits on a 24*7 basis.

Needless to say, the California Doctors Plan clearly highlights the strong relationship shared between the two healthcare providers. In fact, the joint effort will be suitable in meeting the rising demand for high-quality and cost-effective health plans by employers in the market.

Moreover, the relation between the two healthcare providers can be traced back to the year 2017 when UnitedHealthcare ventured into a product partnership with Canopy Health. The same tie-up was intended to benefit commercial members enrolled in the SignatureValue HMO plan as they had to pay lower premiums than a traditional HMO plan.

Coming back, the California Doctors Plan is the latest addition to the suite of health plans developed so far by the joint efforts of both the healthcare providers. Members of UnitedHealthcare in Northern California, who are enrolled in the health plans developed due to the joint efforts, have access to over 5,000 physicians and 19 hospitals under Canopy Health’s network.

Earlier this year, the relationship was strengthened further with the roll out of the UnitedHealthcare Canopy Health Medicare Advantage plan.

Apart from coming up with new health plans, UnitedHealthcare and Canopy Health are striving hard to set up a robust data and analytics infrastructure, which is significantly important for dealing with advanced population health and value-based care initiatives.

Shares of this Zacks Rank #3 (Hold) healthcare provider have gained 30.1% in a year outperforming the industry’s growth of 21.4%.

Furthermore, UnitedHealthcare constantly undertakes initiatives to boost its healthcare business. It not only has a strong vision network for looking after the eye health of its members but has also launched teledentistry services aimed at oral health improvements.

Hence, robust performance at the UnitedHealthcare and Optum segments have driven revenues for UnitedHealth Group, which has witnessed a 10-year CAGR of 9.9%. Notably, the momentum continued in the first half of 2020 as well. The company continues to benefit from new deals, renewed agreements and expansion of service offerings. The pandemic has highlighted the importance of telehealth services, and the company is well poised to capitalize on the current scenario.

Stocks to Consider

Some better-ranked stocks in the medical space are Select Medical Holdings Corporation SEM, The Ensign Group, Inc. ENSG and Humana Inc. HUM. While Select Medical and Ensign sport a Zacks Rank #1 (Strong Buy), Humana carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Select Medical, Ensign and Humana surpassed earnings estimates in each of the trailing four quarters by 212.61%, 17.08% and 11.63%, on average, respectively.

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UnitedHealth Group Incorporated (UNH): Free Stock Analysis Report

Humana Inc. (HUM): Free Stock Analysis Report

Select Medical Holdings Corporation (SEM): Free Stock Analysis Report

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