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Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread Ratio
Economic Profit Margin

UnitedHealth Group Inc., economic profit calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net operating profit after taxes (NOPAT)¹	26,672)	22,615)	18,910)	18,059)	16,327)
Cost of capital²	8.91%	8.96%	8.94%	8.68%	8.73%
Invested capital³	182,841)	165,347)	139,922)	130,513)	117,370)

Economic profit⁴	10,383)	7,805)	6,404)	6,726)	6,077)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ NOPAT. See details »

² Cost of capital. See details »

³ Invested capital. See details »

⁴ 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 26,672 – 8.91% × 182,841 = 10,383

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Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	UnitedHealth Group Inc. economic profit increased from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc., NOPAT calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net earnings attributable to UnitedHealth Group common shareholders	22,381)	20,120)	17,285)	15,403)	13,839)
Deferred income tax expense (benefit)¹	(245)	(673)	130)	(8)	230)
Increase (decrease) in receivables allowances²	774)	363)	(90)	659)	164)
Increase (decrease) in unearned revenues³	280)	504)	(271)	220)	226)
Increase (decrease) in equity equivalents⁴	809)	194)	(231)	871)	620)
Interest expense	3,246)	2,092)	1,660)	1,663)	1,704)
Interest expense, operating lease liability⁵	196)	164)	124)	133)	154)
Adjusted interest expense	3,442)	2,256)	1,784)	1,796)	1,858)
Tax benefit of interest expense⁶	(723)	(474)	(375)	(377)	(390)
Adjusted interest expense, after taxes⁷	2,719)	1,782)	1,409)	1,419)	1,468)
Net income (loss) attributable to noncontrolling interest	763)	519)	447)	366)	400)
Net operating profit after taxes (NOPAT)	26,672)	22,615)	18,910)	18,059)	16,327)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Elimination of deferred tax expense. See details »

² Addition of increase (decrease) in receivables allowances.

³ Addition of increase (decrease) in unearned revenues.

⁴ Addition of increase (decrease) in equity equivalents to net earnings attributable to UnitedHealth Group common shareholders.

⁵ 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 4,898 × 4.00% = 196

⁶ 2023 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 3,442 × 21.00% = 723

⁷ Addition of after taxes interest expense to net earnings attributable to UnitedHealth Group common shareholders.

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Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	UnitedHealth Group Inc. NOPAT increased from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc., cash operating taxes calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Provision for income taxes	5,968)	5,704)	4,578)	4,973)	3,742)
Less: Deferred income tax expense (benefit)	(245)	(673)	130)	(8)	230)
Add: Tax savings from interest expense	723)	474)	375)	377)	390)
Cash operating taxes	6,936)	6,851)	4,823)	5,358)	3,902)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

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Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	UnitedHealth Group Inc. cash operating taxes increased from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc., invested capital calculation (financing approach)

US$ in millions

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Short-term borrowings and current maturities of long-term debt	4,274)	3,110)	3,620)	4,819)	3,870)
Long-term debt, less current maturities	58,263)	54,513)	42,383)	38,648)	36,808)
Operating lease liability¹	4,898)	4,830)	4,273)	4,447)	3,959)
Total reported debt & leases	67,435)	62,453)	50,276)	47,914)	44,637)
Shareholders’ equity attributable to UnitedHealth Group	88,756)	77,772)	71,760)	65,491)	57,616)
Net deferred tax (assets) liabilities²	3,021)	2,769)	3,265)	3,367)	2,993)
Receivables allowances³	3,084)	2,310)	1,947)	2,037)	1,378)
Unearned revenues⁴	3,355)	3,075)	2,571)	2,842)	2,622)
Equity equivalents⁵	9,460)	8,154)	7,783)	8,246)	6,993)
Accumulated other comprehensive (income) loss, net of tax⁶	7,027)	8,393)	5,384)	3,814)	3,578)
Redeemable noncontrolling interests	4,498)	4,897)	1,434)	2,211)	1,726)
Nonredeemable noncontrolling interests	5,665)	3,678)	3,285)	2,837)	2,820)
Adjusted shareholders’ equity attributable to UnitedHealth Group	115,406)	102,894)	89,646)	82,599)	72,733)
Invested capital	182,841)	165,347)	139,922)	130,513)	117,370)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Addition of capitalized operating leases.

² Elimination of deferred taxes from assets and liabilities. See details »

³ Addition of allowance for doubtful accounts receivable.

⁴ Addition of unearned revenues.

⁵ Addition of equity equivalents to shareholders’ equity attributable to UnitedHealth Group.

⁶ Removal of accumulated other comprehensive income.

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Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	UnitedHealth Group Inc. invested capital increased from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc., cost of capital calculations

Dec 31, 2023

	Capital (fair value)¹	Weights					Cost of capital
Equity²	459,381)	459,381)	÷	525,218)	=	0.87	0.87	×	9.72%	=	8.50%
Commercial paper, long-term debt and other financing obligations³	60,939)	60,939)	÷	525,218)	=	0.12	0.12	×	4.16% × (1 – 21.00%)	=	0.38%
Operating lease liability⁴	4,898)	4,898)	÷	525,218)	=	0.01	0.01	×	4.00% × (1 – 21.00%)	=	0.03%
Total:	525,218)					1.00					8.91%

Based on: 10-K (reporting date: 2023-12-31).

¹ US$ in millions

² Equity. See details »

³ Commercial paper, long-term debt and other financing obligations. See details »

⁴ Operating lease liability. See details »

Dec 31, 2022

	Capital (fair value)¹	Weights					Cost of capital
Equity²	451,806)	451,806)	÷	511,062)	=	0.88	0.88	×	9.72%	=	8.59%
Commercial paper, long-term debt and other financing obligations³	54,426)	54,426)	÷	511,062)	=	0.11	0.11	×	4.07% × (1 – 21.00%)	=	0.34%
Operating lease liability⁴	4,830)	4,830)	÷	511,062)	=	0.01	0.01	×	3.40% × (1 – 21.00%)	=	0.03%
Total:	511,062)					1.00					8.96%

Based on: 10-K (reporting date: 2022-12-31).

¹ US$ in millions

² Equity. See details »

³ Commercial paper, long-term debt and other financing obligations. See details »

⁴ Operating lease liability. See details »

Dec 31, 2021

	Capital (fair value)¹	Weights					Cost of capital
Equity²	449,966)	449,966)	÷	506,822)	=	0.89	0.89	×	9.72%	=	8.63%
Commercial paper, long-term debt and other financing obligations³	52,583)	52,583)	÷	506,822)	=	0.10	0.10	×	3.57% × (1 – 21.00%)	=	0.29%
Operating lease liability⁴	4,273)	4,273)	÷	506,822)	=	0.01	0.01	×	2.90% × (1 – 21.00%)	=	0.02%
Total:	506,822)					1.00					8.94%

Based on: 10-K (reporting date: 2021-12-31).

¹ US$ in millions

² Equity. See details »

³ Commercial paper, long-term debt and other financing obligations. See details »

⁴ Operating lease liability. See details »

Dec 31, 2020

	Capital (fair value)¹	Weights					Cost of capital
Equity²	316,351)	316,351)	÷	373,348)	=	0.85	0.85	×	9.72%	=	8.23%
Commercial paper, long-term debt and other financing obligations³	52,550)	52,550)	÷	373,348)	=	0.14	0.14	×	3.80% × (1 – 21.00%)	=	0.42%
Operating lease liability⁴	4,447)	4,447)	÷	373,348)	=	0.01	0.01	×	3.00% × (1 – 21.00%)	=	0.03%
Total:	373,348)					1.00					8.68%

Based on: 10-K (reporting date: 2020-12-31).

¹ US$ in millions

² Equity. See details »

³ Commercial paper, long-term debt and other financing obligations. See details »

⁴ Operating lease liability. See details »

Dec 31, 2019

	Capital (fair value)¹	Weights					Cost of capital
Equity²	283,415)	283,415)	÷	332,852)	=	0.85	0.85	×	9.72%	=	8.27%
Commercial paper, long-term debt and other financing obligations³	45,478)	45,478)	÷	332,852)	=	0.14	0.14	×	3.92% × (1 – 21.00%)	=	0.42%
Operating lease liability⁴	3,959)	3,959)	÷	332,852)	=	0.01	0.01	×	3.90% × (1 – 21.00%)	=	0.04%
Total:	332,852)					1.00					8.73%

Based on: 10-K (reporting date: 2019-12-31).

¹ US$ in millions

² Equity. See details »

³ Commercial paper, long-term debt and other financing obligations. See details »

⁴ Operating lease liability. See details »

UnitedHealth Group Inc., economic spread ratio calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit¹	10,383)	7,805)	6,404)	6,726)	6,077)
Invested capital²	182,841)	165,347)	139,922)	130,513)	117,370)
Performance Ratio
Economic spread ratio³	5.68%	4.72%	4.58%	5.15%	5.18%
Benchmarks
Economic Spread Ratio, Competitors⁴
Abbott Laboratories	-1.99%	0.22%	0.66%	-2.60%	-3.92%
Cigna Group	-2.26%	0.78%	-0.20%	2.69%	-0.52%
CVS Health Corp.	0.45%	-4.00%	-0.02%	0.43%	-0.35%
Elevance Health Inc.	-1.02%	-0.20%	1.08%	-0.90%	-0.07%
Humana Inc.	1.14%	2.36%	2.70%	9.56%	7.70%
Intuitive Surgical Inc.	5.26%	4.98%	20.59%	8.58%	25.26%
Medtronic PLC	-4.12%	-2.88%	-4.48%	-3.60%	-2.51%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Economic profit. See details »

² Invested capital. See details »

³ 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 10,383 ÷ 182,841 = 5.68%

⁴ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic spread ratio	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	UnitedHealth Group Inc. economic spread ratio improved from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc., economic profit margin calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit¹	10,383)	7,805)	6,404)	6,726)	6,077)

Revenues, customers	367,533)	322,132)	285,273)	255,639)	240,269)
Add: Increase (decrease) in unearned revenues	280)	504)	(271)	220)	226)
Adjusted revenues, customers	367,813)	322,636)	285,002)	255,859)	240,495)
Performance Ratio
Economic profit margin²	2.82%	2.42%	2.25%	2.63%	2.53%
Benchmarks
Economic Profit Margin, Competitors³
Abbott Laboratories	-2.96%	0.31%	0.96%	-4.54%	-7.15%
Cigna Group	-1.00%	0.37%	-0.11%	1.58%	-0.32%
CVS Health Corp.	0.17%	-1.54%	-0.01%	0.22%	-0.19%
Elevance Health Inc.	-0.42%	-0.09%	0.51%	-0.42%	-0.04%
Humana Inc.	0.33%	0.74%	1.00%	2.75%	2.26%
Intuitive Surgical Inc.	5.25%	4.30%	16.20%	8.80%	18.72%
Medtronic PLC	-9.30%	-6.33%	-10.75%	-8.86%	-5.97%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ Economic profit. See details »

² 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenues, customers
= 100 × 10,383 ÷ 367,813 = 2.82%

³ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	UnitedHealth Group Inc. economic profit margin improved from 2021 to 2022 and from 2022 to 2023.

UnitedHealth Group Inc. (NYSE:UNH)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Economic Spread Ratio

Economic Profit Margin