Is AI the Key to UnitedHealth's Market Growth and Cost Control?

As the HMO industry navigates regulatory reforms, rising costs and public scrutiny, UnitedHealth Group Incorporated UNH is intensifying efforts to streamline operations, lower expenses and expand its market presence by targeting tech-savvy consumers. A key part of this strategy involves strengthening AI literacy and ethical training programs for its clinicians and data analysts to ensure responsible use of emerging technologies.

According to a May 2025 report from The Wall Street Journal, UNH has now deployed more than 1,000 AI-driven solutions across its insurance, clinical and pharmacy segments. These tools handle a wide range of tasks, from transcribing and summarizing clinical visits to automating claims processing and powering customer service chatbots. The company also revealed that approximately 20,000 of its engineers actively leverage AI to aid in software development.

UnitedHealth’s chief digital & technology officer, Sandeep Dadlani, emphasized in a late May 2025 interview with Fortune that the company’s aggressive AI investments aim to address broad structural flaws in U.S. healthcare. He noted that around 90% of claims are now auto-adjudicated, signifying a major shift from manual to AI-driven workflows, and hinted at new AI-based products rolling out later this year.

Despite these advancements, UNH faces legal challenges over its AI use. A 2023 class action lawsuit alleged misuse of an AI algorithm in claims evaluation. Although several claims were dismissed, the court allowed the case to proceed on key counts. Overall, UNH’s AI strategy signals a decisive shift toward automation and digital transformation across its entire operation.

How Are Other Health Insurers Leveraging AI?

Humana Inc.’s HUM CenterWell is testing about 20 AI solutions aimed at enhancing clinical workflows and easing provider workload. Humana’s ambient AI records doctor-patient conversations, reducing cognitive strain, with 90,000 minutes captured so far. AI also supports pharmacy reminders, shipping optimization and call center prompts to improve Humana’s patient service quality.

Elevance Health, Inc. ELV uses AI for predictive analytics to identify high-risk members and tailor treatment plans based on clinical and genetic data. Elevance’s AI-powered chatbots assist customers, while fraud detection and care coordination tools enhance operations. The Health OS platform and smart claims engine streamline processes, improve accuracy and reduce Elevance’s training time.

UnitedHealth’s Price Performance, Valuation and Estimates

Shares of UNH have lost 40.6% in the year-to-date period compared with the industry’s decline of 29.4%.

From a valuation standpoint, UnitedHealth trades at a forward price-to-earnings ratio of 12.60, up from the industry average of 11.62. UNH carries a Value Score of B.

The Zacks Consensus Estimate for UnitedHealth’s 2025 earnings is pegged at $22.28 per share, implying a 19.5% drop from the year-ago period.

The stock currently carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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