UnitedHealth Group is switching up its leadership.
Effective September 1, CEO Stephen Hemsley will leave his position to take on the newly created role of executive chairman of the board of directors.
David Wichmann, president of UnitedHealth Group and leader of the UnitedHealthcare business, will succeed Hemsley as CEO. He previously served as CFO.
Additionally, current chairman of the board Richard Burke will become lead independent director.
Sixty-five-year-old Hemsley has headed up the Minnetonka, Minnesota-based company since 2006, according to the Star Tribune.
In a statement, he commented on the impending change:
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
This is the right time for this transition to take place, as the company is performing strongly and has a positive outlook for the forseeable future, and Dave Wichmann is the right choice to succeed as CEO for that future. … I look forward to continuing to help drive the mission, growth, quality, performance and development of this enterprise in my new role as, together, we continue to improve health and health care for the people we serve, while providing consistent returns to shareholders.
But does UnitedHealth really have a “positive outlook for the forseeable future” as Hemsley noted?
In April 2016, the company said it would exit the 2017 Affordable Care Act exchanges in all but a “handful” of states due to hefty financial losses.
And in May, it revealed its Harken Health subsidiary was shutting the doors of its 11 clinics in Illinois and Georgia. Launched in 2015, it was UnitedHealth’s bet on merging health insurance coverage with primary care. Harken’s closing came after it reported a net loss of almost $64 million in 2016.
Despite these occurrences, the company seems to be doing fairly well this year. It reported a revenue of $50.1 billion for the second quarter of 2017.
Yet perhaps given the current health insurance landscape, now seemed as good a time as ever for Hemsley to step down.
Photo: lvcandy, Getty Images
