Optum Layoffs Affect Teams in Medicare Advantage I-SNP, IE-SNP Business

Optum is paring back its workforce, including in the parts of the business related to Medicare Advantage plans for nursing home and assisted living residents.

This is according to multiple industry sources who communicated with Skilled Nursing News, as well as anonymous posts on an online message board related to the layoffs at Optum, which is the health care services arm of insurance giant UnitedHealth Group (NYSE: UHG).

Optum provides technology services, pharmacy care services, including a pharmacy benefit manager, and various direct healthcare services. The company also has been the dominant player in providing care delivery and coordination for Medicare Advantage Institutional Special Needs Plans (I-SNPs), which are MA plans tailored to the needs of nursing home residents. Optum serves more than 1,800 SNFs and – as of 2019 – more than 70,000 plan members nationwide, according to the company’s website.


The recent layoffs at Optum number hundreds of people across various parts of the company, according to multiple news reports. The company is discontinuing its virtual care business, as Endpoints first confirmed.

Harrison Frist, the CEO of naviHealth, is resigning from his role with Optum’s Home & Community Care business. Optum acquired naviHealth for about $1 billion in 2020, but the technology platform has been a flashpoint for controversy and is at the center of a legal battle that involves the alleged use of naviHealth in claims denials related to nursing home services.

Optum’s I-SNP and IE-SNP business also has been affected, sources told SNN. IE-SNPs are a type of special needs plan for people with needs equivalent to that of the long-term care facility population, but who can remain at home. Those eligible for IE-SNPs often live in group home settings or assisted living residences.


Multiple sources have shared that out of a roughly 20% to 30% of a 400-person workforce has been laid off in this part of Optum – and message board posts reflect that as well.

The reduction in staff was across the board from senior leaders on the clinical end to low-level employees, industry sources said.

In addition to the layoffs, Optum is suspending its IE-SNP business in all but four states, according to sources, including anonymous contributors to an online message board.

In a statement to SNN, a spokesperson for Optum neither confirmed nor denied the news of layoffs and other changes in Optum’s Senior Community Care part of the business, stressing that Optum had more than 19,000 open positions at last check, with many available for telecommuting.

“As an enterprise, we are committed to providing patients with a robust network of providers for virtual urgent, primary and specialty care options,” the spokesperson said in an emailed statement. “We continually review the capabilities and services we offer to meet the growing and evolving needs of our businesses and the people we serve. As always, we will support affected team members with job placement resources and seek to deploy them where possible to any open roles within the company.”

Over the last 20 years, Optum had a very dominant market position, but more competition has emerged in the I-SNP and IE-SNP space.

Those competitors include American Health Plans, Longevity and PPHP (Provider Partners Health Plan). These companies have built their businesses largely on a growing appetite among nursing home providers to take direct ownership in an I-SNP, versus participating on a contract basis in an I-SNP owned by a larger insurance company.

Still, despite the increase in competition, Optum remains the sector’s heavy hitter. By one estimate shared with SNN, Optum has more than 66,000 members, while others in the space have 52,000 members combined as of the end of 2023.

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