UnitedHealthcare Layoffs 2017: 381 Jobs Cut After Insurer Loses Contract

Health Insurance

UnitedHealthcare Layoffs in 2017 Continue to Add Up

As the debate rages on in the United States concerning the future of healthcare, health insurance firm UnitedHealth Group Inc (NYSE:UNH) has cut jobs from its “UnitedHealthcare” division across the country, from Phoenix to Colorado.

The UnitedHealthcare layoffs in 2017 have spiked, with hundreds of people losing their jobs throughout the year. The number of UnitedHealthcare job cuts in 2017 has now exceeded 500.

One of the major reasons for the layoffs is that the company has fallen on hard times recently. That is mainly due to losing its contract with “Tricare,” which is the healthcare insurance program for U.S. military members, veterans, and their families.

Tricare, which is controlled by the United States Department of Defense, will continue to manage veteran and military healthcare affairs as usual, but with a different insurance company administrating the program in 2018. The Tricare program cancelled its contract with UnitedHealthcare and signed a new one with rival company Health Net, Inc. (NYSE:HNT). Health Net is a company that was acquired by Centene Corp (NYSE:CNC) in March 2016.


Despite the UnitedHealthcare layoffs in 2017,  UnitedHealth Group Inc stock has enjoyed a good year in the market overall.

UnitedHealthcare Cuts 381 Job Cuts in Arizona in November 2017

UnitedHealthcare’s most recent cuts were in November, when 381 employees were shed in the Phoenix, Arizona area after the the company lost its Tricare contract. The company lost its bid to continue providing services to Tricare in July 2016, which resulted in the Phoenix layoffs in late 2017. The Tricare contract officially ends on December 31, 2017, with January 2018 marking the beginning of Tricare’s contract with Health Net.

UnitedHealth Group Layoffs in April 2017: 119 Job Cuts in Colorado

While the year is ending poorly for the company (in terms of UnitedHealthcare layoffs in 2017), the year didn’t exactly begin well either. The company announced Centennial, Colorado layoffs in February, with 119 employees cut from an office in the city.
The job cuts in Centennial were specifically at UnitedHealth Group’s affiliate health services business, Optum, Inc. Even though those job losses were announced in February, they took place in April. This round of health insurance layoffs in 2017 was more about general cost savings and reorganization, in contrast to the Phoenix layoffs later in the year, which were directly precipitated by the loss of the Tricare contract.

Other Health Insurance Layoffs in 2017 

The UnitedHealthcare layoffs in 2017 were not the only major job cuts being made in the industry this year. Many other organizations felt financial pressure, and were forced to axe hundreds of employees across the country.
MetLife Inc (NYSE:MET) announced that it was slashing 61 employees at the company’s Bloomfield, Connecticut offices. The layoffs, which will take place on December 31, were the result of a poor financial showing in its most recent quarter, when the company reported a loss of $87.0 million.

Humana Inc (NYSE:HUM) is similarly laying off hundreds of employees in an effort to offset the financial losses that the company incurred following a failed merger with health insurance company Aetna Inc (NYSE:AET). Humana’s  downsizing amounted to more than 700 people losing their jobs.

Molina Healthcare, Inc. (NYSE:MOH) cut 400 jobs in September. These layoffs came after the company reported a $230.0-million loss in its second-quarter financial results. Cost-cutting measures were a logical progression.  Interim CEO Joseph White said the company had “taken aggressive and urgent steps to substantially improve [its] financial performance going forward.” 

AmeriHealth Caritas Iowa also cut 400 employees. The private health insurer announced that it is ending its contract with the Iowa government to manage Medicaid patients. That change has led to hundreds of layoffs at AmeriHealth  in 2017.

The health insurance layoffs in 2017 have amounted to thousands of jobs being lost across the country, with many companies struggling to contest with a shifting healthcare landscape. This is partly because the federal government has yet to settle on what exactly the future of its healthcare system will be.

UnitedHealthcare to lay off 381 in Phoenix,Becker’s Hospital Review, November 2, 2017.