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Among those strengths, world-leading innovation. The U.S. has developed the most advanced clinical approaches and patient-centric care at a pace not seen anywhere else. It's why, if provided with the option, people from all over the world come here to seek care for the most complex conditions.

Yet, the health system needs to function better. Through decades of federal and state policymaking and private sector innovation, we have a variety of programs, structures, and processes. There are strong merits to that variety as they can be more tailored to meet the specific needs of individuals at various stages of life and health status and provide extra help for those who need it. It avoids a one-size-fits-all approach, but it needs to be less confusing, less complex, and less costly.

America faces the same fundamental healthcare dynamic as the rest of the world. The resources available to pay for healthcare are limited, while demand for healthcare is unlimited. Every society wrestles with that issue and approaches it in various ways. We have incredible opportunities here to improve system performance, both from a care and a cost perspective, while building upon the foundational strengths I just mentioned.

The mission of this company, why we exist, is to improve this system for everybody and help people live healthier lives. That means getting more people into high-quality value-based care and keeping them healthy in the first place so fewer Americans find themselves with a chronic and, in many cases, preventable disease. It means continuing to invest in programs like Medicare Advantage, which, by providing coordinated care to seniors, is proven to deliver better health outcomes at lower cost to consumers and taxpayers compared to fee-for-service Medicare. Seniors recognize that value, which is why the majority of them choose Medicare Advantage.

It means making healthcare easier to navigate. We're enhancing digital tools for consumers, harnessing data, and using AI so they can find the best value care option and decide what is best for themselves and their families. People's health interactions should be as intuitive and seamless as every other aspect of their lives: banking, shopping, streaming. This past year, we saw an extraordinary increase in the use of these modern channels.

We know there is still a large gap there, and we intend to keep at it until it is closed. It means making coverage and cost easier to understand. Just one example where we already have advanced plans: We are eager to work with policy leaders to use standardization and technology to speed up turnaround times for approval of procedures and services for Medicare Advantage patients and to materially reduce the overall number of prior authorizations used for certain MA services. Some of this work we can do on our own, and we're doing it, but we're encouraged also by industry and policymaker interest in solving for this particular friction across the whole system.

Ultimately, improving healthcare means addressing the root cause of healthcare costs. Fundamentally, healthcare costs more in the U.S. because the price of a single procedure, visit, or prescription is higher here than it is in other countries. The core fact is that price, more than utilization, drive system costs higher.

Tackling that problem will require all parts of the system and policymakers to come together. Yet, there are participants in the system who benefit from these high prices. Lower-cost equivalent quality sites of service, for example, can be good for consumers and patients but threaten revenue streams for organizations that depend on charging more for care. Another example is the persistently high cost of drugs in the U.S., leaving American consumers, employers, and public agencies to pay disproportionately more than people in other countries.

Just look at GLP-1 prices, one drug which costs $900 in the U.S. costs about a tenth of that in Europe. Pharmacy benefit managers play a vital role in holding those prices down, which is why drug companies and their allies have spent the past several years attacking them. Optum Rx alone delivers many tens of billions of dollars in savings annually versus the pricing set by the manufacturers, including on the GLP-1s.

That sharply reduces the gap versus other countries. But even then, prices in the U.S. are still multiples of what the rest of the world pays for the same drugs. Last year, our PBM passed through more than 98% of the rebate discounts we negotiated with drug companies to our clients.

While we offer customers 100% pass-through options, a small number have historically elected other models. We are committed to fully phasing out those remaining arrangements so that 100% of rebates will go to customers by 2028 at the latest. We will continue to encourage all of our clients to fully pass these savings directly to patients at the point of sale, as we already do for all of the people we serve in our fully insured employer offerings. This will help make more transparent who is really responsible for drug pricing in this country, the drug companies themselves.

Health care in every country is complex, and the solutions are not simple. But you should expect this company to continue to work at it, finding what is needed, developing solutions, bringing those solutions to scale, making a positive impact on the lives of millions of people. We deliver on our commitments to the people we serve, including our investors. Even in highly challenging periods like 2024, our results bear out that we find a way, even if it's not always how we may have initially envisioned the path.

Among some of the formidable challenges we navigated over the course of the year were the first year of the three-year CMS Medicare rate cuts, the effects of the state-driven Medicaid member redeterminations, and the Change Healthcare cyberattack. Our people found a way to deliver solidly within the range we first offered back in November of 2023, all while improving patient and consumer health outcomes and experiences, focusing on quality, and expanding upon our potential to help make the health system work better for everyone. We're invigorated by the path ahead. There are so many areas that can be enhanced, reworked, reengineered, or even scrapped to make the health system work better, as we know it needs to.

That is both our responsibility and it's our passion. We begin 2025 with a strong outlook for the year as we continue to deliver on our commitments and excel for those we serve in all of our key growth pillars. Now, John will walk you through this performance in a little more detail.

John F. Rex -- President and Chief Financial Officer

Thank you, Andrew, and I'll add my deep gratitude for the enormous outpouring of support over the past few weeks. Brian helped build this company and forged deep, trusted relationships for over 20 years, and the positive impact he had on people will be felt for years to come. This morning, I'll discuss both 2024 results and our performance expectations for '25, including some of what we had planned to discuss with you in December. 2024 revenues of over 400 billion and adjusted earnings per share of $20 -- $27.66 were well within the outlook ranges we set out over a year ago.

To be sure, things played out differently than initially anticipated, but it is an enduring trait of this enterprise that we deliver on our commitments to the people we serve and to you, even amid unforeseen circumstances. Over the course of '24, we undertook initiatives and made investments to strengthen us for the future. Initiatives to improve consumer experience and bring new innovations to market more quickly, drive the most compelling ways to further our mission to help make the health system work better for everyone, and continue to optimize and refine our offerings and business portfolio to enhance future growth potential, whether that meant moving into new opportunities, reconfiguring or moving out of areas which contributed historically but may no longer be core, all with an eye to unlocking value. We know you have a number of questions that we were not able to discuss last month.

So, today, I'll start by stepping through a couple you have indicated are top of mind. The first one is why our '24 medical care ratio was 150 basis points above our original outlook. It's important to frame up the challenges of '24 to offer some perspectives on the commitment and response of our people. Compared to the midpoint of the care ratio range we stepped out with over a year ago, that alone created a nearly $5 billion gap we needed to overcome, and that's before we get to the nearly 1 billion in business disruption impact due to the cyberattack.

So, we start with about 6 billion in unanticipated impacts just from these two examples, in addition to managing through the already known multibillion-dollar impact of the Medicare rate cuts as we sought to preserve as much benefit stability for seniors as possible. Regarding the elements impacting our '24 care ratio, we've spoken about the key factors on prior earnings calls, so no surprises here. The first comprised about 70% of the total impact and are comparable in magnitude to each other. First, the mix of people served.

We ended up with a different profile of consumer than expected. This is because of one factor: We didn't grow as anticipated due to the unusual Medicare Advantage benefit designs in the marketplace in '24. Next, the timing mismatch between the health status of the remaining people being served by Medicaid and the lagging state rate updates. Then there were the costs related to the cyberattack and our South America business impacts.

The remaining two elements comprised about 30% of the impact and are evenly split. These include a more rapid than expected acceleration in the prescribing of certain high-cost medications as drug companies took early advantage of the Inflation Reduction Act and an aggressive upshift in hospital coding intensity. This is incorporated into our outlook, even as we work to get it back in line. Those are the '24 care ratio elements.

Next question, given all that, are we confident in the adequacy of our pricing for '25? The answer is yes. And here's why. To start, for '25, the outlook we shared in December incorporates a view of care activity commensurate with what we saw in '24, even the care activity we experienced as we exited the year. I'll break that down with some business line perspectives.

In Medicaid, we see the gap between people's health status and state rates narrowing over the course of the year. Our outlook assumes a measured pacing of that process. Actions to date, including the important January 1 renewal cycle, support this view. In commercial, pricing for '25 is appropriately capturing the care activity we are seeing.

This is evidenced by growth heavily weighted toward self-funded offerings. We will continue our disciplined approach. In Medicare, we had strong AEP results, which included winning back people we had served previously and near-record retention. These are a direct result of our long history of offering sustainable benefits for seniors.

With strong retention and the many returning consumers, we start the year with highly informed insights into the care needs of the people we will be serving. In addition, this year, we have seen a notable uptake of our more managed offerings, think HMO style, which provides strong value for consumers, effective care tools for doctors, and more predictable performance. We expect a '25 full year medical care ratio of 86.5%, plus or minus 50 basis points, 100 basis points above the '24 result. In addition to factors discussed earlier, the increase is driven by IRA impacts, the second year of the Medicare funding cuts, a continued mix shift toward public sector offerings, and a respectful view of care activity.

Our '24 operating cost ratio improved about 150 basis points over the prior year. Roughly half of the change was driven by contributions from the business portfolio initiatives mentioned earlier. The other half was due to accelerating our efforts to realize operating efficiencies, even as we improve consumer experiences. Some of these advances are a result of the very early stage impacts we are beginning to realize from AI-driven initiatives to help our customer service representatives respond to consumers' needs more effectively and quickly.

And we see continuing opportunities both in the near term with operating costs for '25 improving still further and well beyond given the rapidly expanding scope and impact of these initiatives. These actions and the resourcefulness of our people helped deliver upon the objectives set out over one year ago and helped to partially balance the multiple billions of unanticipated impacts. With that, I'll run through our businesses, offering some key points for each, starting with Optum Health, where revenues grew to about 105 billion in '24 and are expected to approach 117 billion in '25. Our care delivery business continues to deepen its presence in existing areas while expanding into new geographies and services.

In '25, we expect Optum Health will serve about 5.4 million value-based care patients, a growth of 650,000 over '24. While our current position provides a solid footing, it's a small fraction of the hundreds of millions of patients who can ultimately benefit from value-based care. We see value-based care as foundational. It is perhaps the fullest expression of our mission.

As Andrew noted, the outdated activities-based fee-for-service system won't help the health system work better for people. Value-based care is outcomes-based, aligning processes, actions, and incentives, helping keep people healthy in the first place rather than just seeing them when they are sick. Optum Health is an integrated multipayer care delivery company, helping to lead the transition to a truly sustainable value-based care system. As we move into '25, we will continue to enhance access and care integration through the home, a much-needed area to help people with their health.

More than three-quarters of our in-home patient visits result in a primary care visit within 90 days. Medicare Advantage patients with chronic conditions who receive a home care visit have a lower rate of ER visits, fewer inpatient stays, stronger health outcomes, and a better experience, all while saving the health system billions. Turning to Optum Rx. Revenues in '24 grew to over 130 billion and will be about 146 billion in '25.

Our pharmacy benefits management team again had customer retention exceeding 98% while welcoming a record 750 new clients, further proof of the value sophisticators, employers, health plans, and labor unions see in Optum Rx's ability to negotiate lower drug prices for consumers. Optum Rx's pharmacy care services support the entire system in the delivery of clinically driven pharmacy care, serving the highest-need and hardest-to-reach patients. These offerings include community pharmacies, specialty, and infusion drug services, all large strongly growing areas, with our current presence quite small. Optum Insight revenues were 19 billion in '24, and in '25 will approach 22 billion, with a backlog of 35 billion as sales of new products begin to take hold and the customer clearinghouse business continues to rebuild.

The solutions offered through Optum Insight and our health technology growth pillar, delivered at scale, will improve consumer experience and payment and claims flows, enable access to the next best action guidance in a doctor's workflow, and help life sciences customers more rapidly bring innovations to market. And there will be much more to follow. Shifting to UnitedHealthcare. Full year revenues in '24 approached 300 billion, and for '25 will approach 340 billion as we grow to serve upwards of an additional 1.9 million people, balanced across both the commercial and public sectors.

Within our domestic commercial offerings, we grew to serve 2.4 million more people in '24 and expect to continue to grow strongly in '25, especially in our self-funded offerings, which serve some of the most sophisticated buyers of healthcare, large employers. The fact that so many more people are choosing UnitedHealthcare is a direct result of our bringing much-needed innovation to these more mature markets through consumer-centric offerings. As noted earlier, UnitedHealthcare's '24 Medicare Advantage growth was impacted by the unusual benefit designs in the market. Our focus has always been on providing consumer stability and sustainable value, a factor that has built confidence and trust over the long term.

As a result, in '25, we expect growth of up to 800,000 people in individual, group, and special needs offerings. And the growth outlook for the years ahead remains strong, with nearly half of American seniors still in outdated Medicare fee-for-service offerings, which provide less value to them and cost taxpayers more. In Medicaid, we expect to serve more people in '25 with redetermination activities now concluded. UnitedHealthcare's value proposition is resonating with state customers, consumers, and provider partners, and we are participating in a substantial number of expansion proposals.

Most recently, we were honored to have been awarded a new opportunity in Georgia. Our growing businesses support and -- are supported by substantial financial capacities and a strong balance sheet. In '24, we deployed nearly 17 billion in growth capital to help build for the future, further strengthening our capabilities to serve more people more comprehensively. We also returned over 16 billion to shareholders through dividends and share repurchase.

In '25, we expect cash flow from operations will approach 33 billion or 1.2 times net income. We will continue to deploy growth capital and remain committed to returning to shareholders, as outlined in December. Our growth capital deployment efforts deliver their greatest benefits over the course of two, four, or even six years and as new capabilities are scaled and deployed across the enterprise and beyond. To summarize, our strong start to the year reinforces the growth objectives we shared last month and is underpinned by the broad growth drivers, operational excellence, and strategic capital deployment you have come to expect from us.

Now, I'll turn it back to Andrew.

Andrew Philip Witty -- Chief Executive Officer

John, thank you. The strength of this organization lies in the resilience of our people and the fundamental belief that there is no higher calling than helping other people and nothing more vital to the human condition than healthcare. Looking ahead to 2025 and beyond, we're confident in our ability to continue to add value to the health system through our focus on value-based care and consumer-orientated efforts to help build the health system America deserves. And that's also why we remain solidly committed to our long-term 13% to 16% growth objective, a goal that reflects both the opportunities and the capabilities that we have.

And now, operator, we'll open it up for questions.

Questions & Answers:

Operator

The floor is now open for questions. [Operator instructions] We'll go first to A.J. Rice with UBS.

A.J. Rice -- UBS -- Analyst

Hello, everybody, and I appreciate the words about Brian. He's missed by all of us. Just maybe to focus in on the comments about cost trends and the MLR. Obviously, in the fourth quarter, there's variance relative to consensus expectations.

It's probably a little greater than what we thought. It sounds like the cost items you're calling out are similar to the things you had seen all year long. Was there anything that changed in those -- the intensity of any of those trends and anything -- any unusual items in there that impacted the results? And it sounds like you're still confident in your '25 MLR outlook. So, nothing you saw in the fourth quarter changes your view on '25?

Andrew Philip Witty -- Chief Executive Officer

A.J., thanks so much for your question. I'm going to ask John in a sec to obviously go much deeper in response to your question. But just to the last part of your question, yeah, you're totally right, nothing we saw there that changes our view of '25. We feel very good about how we're priced into '25.

We feel really, really good about how the mix has come in in terms of that growth. That's a huge difference to '24. And we really didn't see anything in Q4 that we believe represents a challenge to that view going into '25. But I'd love John to go deeper for you on the Q.

Thanks.

John F. Rex -- President and Chief Financial Officer

Good morning, A.J. So, a few things on this. So, in terms of the items that we called out on the third quarter call, so hospital coding intensity and the specialty prescribing trends that we were seeing, very much in line with what we saw in the third quarter in terms of that ran into the fourth quarter. So, in line with the view on that.

We weren't seeing acceleration in that. We're seeing stabilization in those trends, I would tell you, at the levels we saw before, and we expect that to continue, especially prescribing. Those trends were something we anticipated in our '25 outlook. And as we noted back in the third quarter, that was something that just moved faster in '24 than we expected.

But in terms of the levels we're seeing and how we anticipated that in our '25, we feel very good about that, those coding intensity levels staying at the levels that we saw -- that we had seen, also. And then the other elements that we talked to, mix. Kind of important element in terms of the improvement we see as we move into '25, and those elements. For -- to call out kind of things in the 4Q, a couple of things I'd say.

So, first of all, the move, mostly driven by seasonality, typical seasonality. You see normal deductible wear-offs, those elements. A move sequentially that was similar in terms of the basis point move that we saw a year ago, also, 3Q to 4Q on that. But I'd call out a couple of things, A.J., to your point here.

So, in the sequential move, I'd call out probably 80 basis points to 90 basis points that I'd put into the revenue effect category here. So, in that, think about some elements that might have been coming in such as group MA refunds and elements there where our performance, which was strong over the course of the year, and those hitting in the quarter. Just some elements like that that I'd put in the nonrecurring revenue -- non-run rate revenue category in terms of impacts. That -- and that was probably about 80 basis points to 90 basis points of the impact 3Q to 4Q.

The flu RSV impact, that typical seasonal, that was kind of a, I'd say, in the quarter, 50 basis points to 60 basis points. That's kind of a normal move. And then think of the rest of that move being in the zone of pretty much expected seasonal impact. So, the one element I'd call out there is the revenue effects that probably would be -- would probably be having some impact.

Thank you.

Andrew Philip Witty -- Chief Executive Officer

Great. Thanks so much, John, and thanks again, A.J., for your question. Next question, please.

Operator

We'll go next to Josh Raskin with Nephron.

Joshua Raskin -- Analyst

Hi. Thanks. A question on the Optum Health segment. I guess, and I apologize if I missed this, but did you comment on the change in the consumers? I know you talked about portfolio changes and things like that, but the consumer count dropped about 4 million, and then sort of a noticeable drop in margins.

And I'm wondering if some of that is related to the MA rebates that you just mentioned in terms of the impact on the UHC side as well.

Andrew Philip Witty -- Chief Executive Officer

Yeah. Josh, thanks so much for your question. Let me ask John to start and then ask Dr. Desai to pick up a few details on that, please.

Thanks.

John F. Rex -- President and Chief Financial Officer

Good morning, Josh. So, in terms of the consumer count and impacts on that, so that would go into the category of some of the strategic initiatives that have been ongoing here. So, think about some elements where -- that we may have just been -- that we are maybe de-emphasizing in terms of our focus on that. So, an area that we've de-emphasized, and that would go in that category, is urgent care.

We're approaching that a bit differently now. There was a time when kind of stand-alone urgent care was an important element here. As you start developing more geographic density, however, in a marketplace, you can probably better serve those patients by just having one of your clinics have after-hours presence and focus on that. So, one area that we have diminished in terms of emphasis is urgent care, and that's one of the areas we got out of.

So, really, those accounts were driven by -- I'd call it somewhat narrow offerings, typically, that we have been diminishing and that were part of kind of some of the strategic initiatives that we talked about. In terms of kind of some of the broader margin impacts you're seeing and some of the emphasis and where Optum Health was headed in terms of in the 4Q and where their focus was, I'll turn to Dr. Amar Desai to comment on.

Amar Desai -- Chief Executive Officer, OptumHealth

Thanks, Josh. Hi, Josh. So, to take a step back, look, post-V28, we've been executing on our multiple-year plan to reshape the business, including efforts around direct patient engagement and medical management, as well as integrating our business to deliver on operating cost efficiencies. So, as we look at the quarter, we took a number of planned actions, including restructuring and refining some of our legacy contracts, which had a one-time impact of the year.

We had some membership mix changes, which has been noted. And then we did make some investments in the quarter around clinical quality and the Stars program, as well as onboarding for new membership coming on for 1/1. That being said, we feel very good about our position stepping into 2025. Our AEP growth was strong.

We've also had very strong retention across our care delivery organizations, again reflecting the strength of our provider network and the differentiated care they provide. We also have a better understanding of V28 as we're in the second year of it. And with this progression, our payer relationships and contracts have evolved into the year. As we step into '25, we're in a more favorable spot.

And then the impact of our engagement efforts in 2024. Eighty-five percent of our value-based patients were engaged and 90% among our highest-risk patients. And again, this is best-ever patient engagement for us and is the foundation for the maturation of our value-based cohorts over time. So, overall, our operating model for Optum Health is stronger.

It's underpinned by significant momentum around this engagement and affordability, as well as operating efficiencies, and we're confident in delivering against our long-term margin targets. Thanks for the question, Josh.

Andrew Philip Witty -- Chief Executive Officer

Amar, thanks so much. And I maybe just, you know, finish off that response, Josh, if I might, by, you know, really reiterating something you heard me say just a month ago that even in a very challenging year of 2024, with a lot of changes coming from the outside world in terms of funding reductions and the like from the administration, alongside our commitment to perform, we're also relentless around how we continue to modernize and shape the company for the longer term. And, you know, what you heard John just talk about and you just heard Amar refer to really there is, within Optum Health, you know, alongside strengthening our core business, we recognize some parts of that business aren't necessarily as important in the future as they were in the past. We're not going to shy away from making the choices to ensure that we have real clarity and focus on what we know supports our business and, most importantly, gives us the highest chance of giving the best possible service to patients and members who we serve.

And I think during '24, you saw the organization be very focused not just on the year, but on the shape of how we want the company to develop over the next several years. And that's really what you're seeing reflected in the commentary that John and Amar just touched on. Josh, thanks so much for your question. If we could go to the next question.

Operator

We'll go next to Lisa Gill with J.P. Morgan.

Lisa Gill -- Analyst

Thanks very much for taking my question. Andrew, I want to talk about PBM reform. There seems to be a very large drumbeat right now that we'll see reform at some point in 2025. Really two things here.

One, what do you think that means to your business? And then secondly, you know, you talked about educating those in the marketplace to better understand what you actually bring to the market from a PBM perspective. Are there incremental ways that you can potentially maybe educate Congress because it seems to be a very big disconnect versus how Congress is viewing this versus what PBMs actually do?

Andrew Philip Witty -- Chief Executive Officer

Lisa, thanks so much for your question, and, you know, this is obviously a topic of a lot of people's interest, and that's not surprising because pharmaceutical prices in the U.S. are too high, and I just made that super clear in my comments. And it's not the first time you've heard any of us at United make those comments over the last several years. As you think about that, the issue really is that you have a situation where the PBMs are really the only effective mechanism across the system, which really holds the pharmaceutical company to account once it chooses to set its price.

And by the way, also has the freedom to inflate that price every single year, which is what we see happen. The PBM is there to try and hold that to account and negotiate on behalf of employers, unions, states, and others to try and bring down those prices. But within that, Lisa, is the very first thing that people really need to truly understand. The PBM acts on behalf of the ultimate payer, the employer, the union, the state, and such.

It acts on their behalf because they're ultimately the ones who are typically underwriting the ultimate cost of the medicine for the patients, the consumers who are beneficiaries of their plans that are supported by those organizations. That is often lost in terms of how this mechanism works. And it's critical to understand it. What's important, therefore, is that we -- and you heard me make a couple of references to this, and I hope alongside others across the sector -- really focus on the facts of the situation.

Prices in America are de novo set too high relative to any other price in the world, first off. Secondly, they're inflated every year, which is pretty unusual when you compare that to the rest of the world. Thirdly, as we negotiate to bring those prices down, the benefit of that negotiation, those rebates which are achieved, are very significant, are passed back to the employers, unions, and states. They choose what to do with those rebates.

Now, in the case of UnitedHealthcare, wherein the population of employer benefits that we manage where we have essentially control over that decision, we pass those all the way through to the consumer and the patient who receives the drugs. So, they see the benefit of that rebate. We'd like to see others do the same. Within that overall system, there is also opportunity for people to lose a thread of where the money goes in the system, and that is often what you hear policymakers be concerned about.

That is why this morning, we are committing to a full 100% pass-through of all rebates that we negotiate at the PBM back to the payer, the state, or the union. Right now, we already pass 98% of that through. But unfortunately, even at just that small residual that we retain because those clients want to pay us that way is enough to give people the excuse to argue that the system is not working properly. We're taking that excuse off the table today.

We are committed to full transparency. We are committed to full pass-through to clients. We believe that takes away the excuse of who really is setting the price, and we would like to work with others across the system to relentlessly achieve the lowest net cost for everybody in the system. We'd like to see patients see the benefit of that, and we'd like to work with anybody who wants to work with us to make it happen.

And that's how we're going to engage this year with policymakers and others across the country. With that, Lisa, thanks so much for the question. Let me go to the next question, please.

Operator

We'll go next to Stephen Baxter with Wells Fargo.

Stephen Baxter -- Wells Fargo Securities -- Analyst

Hi. Thanks. Just stay on the policy front, I was wondering if you had any early perspective to share on the Medicare Advantage advance notice for 2026. I guess anything you see as encouraging or any potential areas of concern as you progress from advance to final? And then I guess as a related point, it seems like many would think that the reimbursement that's embedded in these rates is still not reflective of the elevated cost trend that we saw in 2024, even if taking a step in the right direction.

Is that a company perspective that you share? Thank you.

Andrew Philip Witty -- Chief Executive Officer

Hey, Stephen. Thanks so much for the question. I'm going to ask Tim to -- Tim Noel to comment on that, please.

Tim Noel -- Chief Executive Officer, Medicare and Retirement

Yeah. Thanks for the question, Stephen. You know, as you know, these rates are preliminary at this point in time and won't be finalized until April. And so, you know, therefore, probably not super productive to start speculating on elements of that.

I will say we are looking forward very much to engaging the new administration on this item and also a host of other items as they relate to the Medicare Advantage program. Thanks.

Andrew Philip Witty -- Chief Executive Officer

Great. Thanks so much, Tim. And, you know, as you suggest, Stephen, you know, what's most important is that this is all rational, right? So, you know, it's not difficult to figure out in retrospect what trend was, and we'd like to hope that, over the next few cycles, we see that reflected in a way that it hasn't been over the last several years. And that, for us, is really the important element of what we hope will come, and it's simply just rational.

And, you know, it's interesting, when you look at the states in Medicaid, you see that kind of rational behavior. We've seen that improve, and we've been super clear that there's been historic offset lag, if you will, to that. That's not surprising. That can create some discontinuity, as we saw this year in '24.

But underneath all of that, we see rational understanding and engagement from the states. We super appreciate that. It's important, and that's what we want to hope to see return around the MA rate setting in a way that we have not seen over the last several years. OK.

Next question, please.

Operator

We'll go next to Justin Lake with Wolfe Research.

Justin Lake -- Analyst

Thanks. Good morning. I've got a question here, but first I wanted to ask a quick follow-up on this Medicare Advantage revenue adjustment. Given the MLR for the quarter came in higher than expected, it appears this might have come as a surprise.

And given that the employers -- you know, the size of the employer segment, it feels like this adjustment is pretty large, like maybe 5% or more of annual revenue. So, just trying to understand, can you give us more color here? How do the mechanics work of what's going on? Maybe you could tell us why this would have been a surprise. And what periods do they relate to? Is it all 2024? And then my actual question is more on MA growth. Curious what you saw during AEP, both in terms of what proportion of your 8% growth expectation do you expect to come from AEP.

And then do you still see industry growth at mid-single digits? Thanks.

Andrew Philip Witty -- Chief Executive Officer

Hey, Justin. Thanks so much for the question. That was an impressive way of sneaking two instead of one. I'll let you get away with it just this time.

So, John, if you wouldn't mind taking the first part of Justin's good question, and then I'm going to ask Bobby Hunter to take the second. Bobby leads our business in Medicare. So, please go ahead.

John F. Rex -- President and Chief Financial Officer

Justin, good morning. So, yeah, in terms of those elements, so MA kind of group customer refunds was one element of it. And certainly, these are -- and there are a few other adjustments running through that we're all putting the non-run rate revenue impacts here. In terms of surprise or not, so perhaps not anticipated a year ago when we set out kind of in terms of our expectation for medical care ratio and revenues and such.

Not a surprise in terms of where we've been the last while, though, in terms of understanding these things because as they develop and you see, OK, better performance in certain group MA plans, there's going to be a refund that's given to those employers, as we do, as we're performing well. And then some of the other elements. I wouldn't call them surprises. Certainly, relative to a year ago, we didn't have those incorporated in our view.

In terms of relative to months ago, it would have been something we would have understood in those elements. And that was one of them I was trying to give an example. But there were a few, and they totaled up to that 80 basis points or 90 basis points. Group MA refunds being one of them.

But I wouldn't call it a surprise to where our view has been the last few months here on this. And then I'll go to Tim.

Andrew Philip Witty -- Chief Executive Officer

No, to Bobby.

John F. Rex -- President and Chief Financial Officer

Bobby.

Andrew Philip Witty -- Chief Executive Officer

Bobby, yeah.

Bobby Hunter -- President, Medicare Business

Yeah. Thanks, John, and thanks, Justin, for the question. So, in terms of AEP results, we were very pleased with how things played out for us. They're very much aligned to our expectations, and it puts us on track to achieve the full year MA growth target of up to 800,000 that we've communicated.

Really important to remember that with the selling changes for 2025, we do expect more than 50% of our full year growth to come in AEP. Also worth noting, this level of growth is not something we're unfamiliar with, and I'm really proud of our teams and the 1/1 readiness activities we've executed on to ensure a smooth transition for our new and returning customers. Maybe to offer a few highlights on the growth itself. Seeing really balanced and diversified growth across our products and our geographies.

In particular, some really nice strength within our HMO and full dual plan offerings. John also mentioned, you know, retention performing at near record levels, a great testament to the value that we're offering to consumers. And maybe last, you know, of the members who have left us in prior years, we are seeing about three times as many return to UHC this year as compared to last year. I really view that as a testament to the service models and experiences we offer.

And folks clearly put a lot of value in that when they're making their decisions, and I'm really proud to see those individuals coming back to us this year. In terms of the growth rate, you know, we certainly still continue to believe in the long-term growth rate of 7% to 9%, acknowledging that, you know, in certain years, you can see fluctuations based on benefit changes and other factors. You know, some of that was present in 2024. And, you know, similar dynamics will play out here in 2025.

So, we expect '25 to generally pace, you know, in line with '24 from a growth standpoint. You know, that said, more confident than ever in the value that MA offers to consumers and the path that we're on for MA to surpass 70% penetration over time.

Andrew Philip Witty -- Chief Executive Officer

Bobby, thanks so much. And I just want to acknowledge Bobby personally because he -- over the last couple of years, he's really led the strategizing of how to navigate through the very many external changes which have played out through V28 and the like. And, you know, I think you've always heard us talk about playing a multiyear strategy here, and I think that's really coming to fruition. Bobby owns a ton of the credit associated with that, and I'm delighted to see that reflected in the growth performance in the cycle we're in now -- right now that you've just heard described.

And it's that mix improvement that you just heard in Bobby's answer which completely differentiates 2025 from 2024 for UnitedHealthcare. It's super important. And all of those elements you just heard described are essentially what makes up that very important mix improvement, which we've been aiming for and we feel very, very good about. Let me go to the next question, please.

Operator

We'll go next to Lance Wilkes with Bernstein.

Lance Wilkes -- Analyst

Great. Thanks so much and really appreciate your comments at the beginning of the call. Could you talk a little bit about one of the things I think is hanging over long-term investors out there, which is levels of customer satisfaction? I know that's difficult to measure, but I know NPS and other metrics are things you guys look at. Can you talk a little bit about what you perceive to be the major sources of dissatisfaction in those sorts of measures? And then what are some of your strategies and priorities? And does that have any impacts on long-term algorithms for the company as far as economic algorithms, growth algorithms, or just where you prioritize your capabilities? Thanks.

Andrew Philip Witty -- Chief Executive Officer

Yeah. Lance, thanks so much for the question. And listen, I mean, at the core of the company, and if you look at the mission of the company, it's all about trying to improve the health system for everybody. And by that, it means not just reducing the cost of that, making it more affordable, but it's also about trying to make it easier to access, less complex, less confusing.

And as I said in my opening comments, we recognize there's still a lot of work to be done in that regard. You know, some of the areas like, you know, obviously, claims, where people get frustrated about how long it takes for a claim to process or maybe some confusion that goes on in that, those are key areas for us to continue to work hard at to improve. And I can tell you, you know, when you look across claims, less than half of 1% of claims are ultimately rejected for clinical reason because, for whatever reason, they're not deemed to be as safe or effective treatment option. But we all know there are other claims which get held up in the process before you get to that stage.

Now, the overwhelming majority of those claims which are held up are held up because they were either sent to the wrong company, they didn't have the right information on them, the patient didn't have the right benefits, all of those things. Now, that could all be dealt with through technology and a more standardized approach across the industry. And I'm very, very pleased to say that we are experiencing and engaged with a much-heightened energy across the organization to solve this across the whole sector for everybody. And in my view, probably 85 or more percent of all of those claims which end up going to the wrong place and then having to be resubmitted, that could all be avoided with the adoption of real-time processing, a standardized approach, a standardized intake mechanism.

That's a key area for us to focus on. And that, we've alluded to that. I mentioned an effort we're very close to around Medicare Advantage improvement. That's just one of the first steps.

And all of this sits very much in line with the work that Brian, frankly, led over the last several years to really reduce overall activity around PAs and the like. And the company will continue to do that. But I just want to emphasize the criticality of collaboration here to try and design something, not just for one company, but for all companies, not just for one patient, but for all patients. That's what we've got to work toward.

Really looking forward to opportunities to engage with the administration on this because they can also be an important aid to help catalyze those sorts of changes. The second area of consumer improvement opportunity where I believe we are -- we really are making great progress is just around that consumer experience. So, there's no reason in the world why engaging with the healthcare system should feel any different or any less easy than any other engagement you have in your life. And that's why we've been focused over the last several years on this move toward a consumer capability for the whole company.

And that I really believe we're making breakthroughs on in terms of how we're operating. If you just look at 1/1 of this year, so January of this year, and you just look at a couple of examples, our UHC mobile app visits were up 66% year over year. That's another record year of growth. The UHC app remains the No.

1 healthcare app in the Google and Apple app stores. Across the whole of UnitedHealthcare, our consumers are choosing to increase their digital engagement with us by about a third a year. So, the app is two-thirds up. Everything across the whole of UHC is up by about a third.

Our app registrations are up nearly 100% year over year. This is us moving to where American consumers want to be. They want to talk to us digitally. They want to use their phone to be able to access us.

They don't want to make a phone call. It's been an extraordinary shift. We continue to work that way through. We're able to talk to members -- now, about 10% less every year of our members are making phone calls.

They're getting what they need without needing to pick up the phone and make the call. All of those are fantastic metrics. You go to Optum Rx, the other big consumer engagement point. The most common interaction point across American healthcare is in pharmacy.

You look at the 1st of January, you heard already today from John, we enrolled 750 new clients. They represented 1.6 million new American consumers who are now using Optum Rx. We're privileged to serve those people. We were able to bring them on board a third less cost than in the prior year.

That is entirely due to the adoption of digital technology and other modern capabilities. Our digital engagement registrations across Optum Rx themselves are up 16%. Those are all examples of how this company has been investing relentlessly, first and foremost, to understand what American consumers want and then build it. And we are committed to continuing to build those capabilities and deliver the very best, most convenient experience possible, not just in the insurance business, but also in the Optum service business led by Optum Rx.

That's where we're going. We're committed to this agenda, Lance. We always have been. And you should continue to see us make substantial improvements to make the experience of engaging with the healthcare system easier tomorrow than it was yesterday.

I appreciate the question. Next question.

Operator

We'll go next to David Windley with Jefferies.

David Windley -- Analyst

Thank you for taking my questions. And, Andrew, thank you. I want to give you kudos for your emphasis on price. I feel like that's underappreciated in the United States.

My question is around SG&A. If I extract -- if I ignore the portfolio changes, the -- what you might call normal course SG&A, improvement -- efficiency improvement in '24 was still substantial. You need another step-down in 2025, per your guidance. Both of those are significant relative to historical norms.

Could you talk about the sources of that efficiency -- perhaps a nod to AI and some of the technology that you've talked about -- but the sources of those savings and the durability of the savings that you're extracting? Thank you.

Andrew Philip Witty -- Chief Executive Officer

Yeah. David, thanks so much. I'm going to ask John to give you a kind of overview, and then I'm going to ask our chief technology officer to give you a little -- a few examples or a little insight into our ambitious -- I'm going to call it modernization agenda of technology because it's not just AI, it's all of the different aspects. But I think it would be good for you to hear from Sandeep, but, John, would you mind starting off?

John F. Rex -- President and Chief Financial Officer

Good morning, David. So, the source of those savings, along the lines of the commentary that Andrew was offering a few moments ago, led by digital adoption. So, we serve roughly almost 150 million people across the breadth of UnitedHealth Group. And as we seek to make those experiences smoother, simpler, faster, that's being led by digital adoption.

It's being led by having our customer service representatives much more informed when they do pick up the phone if the customer needs to call, much deeper insight into frustrations or any kind of experience the customer may be having or had so they can get to the root cause much more quickly. So, you're seeing those elements just accelerate. Look, I said it a little bit in my commentary. It feels very early stage to us in terms of what we're actually doing here.

And as I work with the technology team, Sandeep and the teams and what they're hitting here, these are -- we're just kind of scratching the surface of the opportunity. So, when you ask the important questions about durability, it's super early stage in terms of what we see as the opportunity. I would tell you, these -- what we're doing right now feel like just kind of the initial scratching the surface that we'd be doing in terms of where we could -- where we believe we can take this and the opportunities that we're seeing. So, one of the things we're most excited about as a team as we sit together and we think about the experience that consumers are going to have, how we're going to be able to make these a much smoother, simpler, and satisfying for everyone, including our employees who work with our customers.

And, Sandeep, maybe you could offer a few comments.

Sandeep Dadlani -- Executive Vice President, Chief Digital and Technology Officer

Sure. Thank you, John, and thanks, David, for the question. Our AI, digital automation, and, in general, our modernization agenda has focused largely on removing administrative menial tasks in the system and improving consumer experiences. Some examples earlier that you have noticed has been around our call center efforts.

Andrew just mentioned we received 10% less calls for the same consumer base compared to last year. And we haven't even scaled this fully. By the end of 2025, we will be scaling this fully. And that's one of hundreds of use cases that we are scaling.

Last quarter, we talked about clinical summaries for nurses that help our nurses focus on healthcare. And that's getting scaled fully. As we focus in 2025, we actually are excited about more compelling consumer experiences, helping providers and clinicians with documentations and summaries, and frankly digitizing all the paperwork in the entire healthcare experience, think benefits documents, facilities, provider contracts, helping drive much more automated seamless, frictionless claims processing as well. So, we're excited about the agenda.

Thank you.

Andrew Philip Witty -- Chief Executive Officer

Sandeep, thanks so much. David, I appreciate the question. If we could move on to the next question, please.

Operator

We'll go next to Scott Fidel with Stephens.

Scott Fidel -- Analyst

Hi. Thanks. Good morning. I was hoping just given some of the, you know, unusual patterns that we saw in '24 and that then will have effects on 2025 when thinking about the sequencing of Medicaid margins and MLRs and some of the utilization patterns, if you would help us maybe in thinking about, you know, any comments on EPS seasonality that may be different in 2025 relative to '24? And then similarly, you know, MLR sequencing that you're thinking maybe having a bit of a different pattern around that guidance of -- that you gave for the full year? Thanks.

Andrew Philip Witty -- Chief Executive Officer

Hey, Scott. Thanks so much. John.

John F. Rex -- President and Chief Financial Officer

Good morning, Scott. So, I'd say in terms of seasonality, first half, second half, think of that as relatively balanced in terms of seasonality for earnings progression. In terms of medical care ratio and thinking about kind of those elements, you start of first, of course, with a view that, at the midpoint, the full year care ratio will be 86.5%. So, as we noted earlier, about 100 basis points above the elevated '24 level.

And I just had discussed '24 included a number of discrete items. Within that, you know, we -- the quarterly pattern will look familiar with the first quarter below the midpoint of that and the fourth quarter above the midpoint and trending up through the middle of the year. And then within the year, the pattern familiar. So, those would be the elements we'd kind of think about as that patterns through.

Slope, a little impacted, of course, by some of the Part D changes that are out there also that I think you're well aware of already because those have been out for a while. So, the slope of that will be impacted a bit by that, also. Those would be the key elements.

Andrew Philip Witty -- Chief Executive Officer

Great. John, thanks so much. Appreciate it. And next question.

Operator

We'll go next to Sarah James with Cantor Fitzgerald.

Sarah James -- Analyst

Thank you. I'll stick on MLR. John, could you help us bridge '24 to '25 by sizing some of the impact of the components that you called out like your assumptions on core trend versus IRA and any offsets like rates or nonrepeat of the MA group refunds? Thanks.

John F. Rex -- President and Chief Financial Officer

Yeah. Good morning, Sarah. Certainly. So, kind of big elements that we'd call out here, certainly, the IRA impacts, mix of our -- the people we're serving.

We're serving more people than public sector plans. Of course, that's kind of a normal course element. And then, of course, a second year of the CMS funding rate reductions here. Elements kind of probably going the other direction here would be, certainly, the cyber and South America impacts.

We had sized those. You know, think about that as about 30 basis points in our 2024. Some of the trends, affordability, and other initiatives that we have in there, also. And then as I mentioned also, just taking an appropriately respectful view of the care activity environment as we step out.

Andrew Philip Witty -- Chief Executive Officer

Great. Thank you. Thanks so much, John. We just have time for one last question, operator.

Operator

We'll go next to Joanna Gajuk with Bank of America.

Joanna Gajuk -- Analyst

Hey. Good morning. Thanks for squeezing me in. So, I guess something that maybe didn't come up from the discussion of MLR being high in '24, but also the outlook for '25, can you talk about the margins in your Medicare Advantage business? So, appreciate your second year of V28 and such, but just, you know, can you frame for us how, you know, the margin in that particular business was in '24 versus your target margins and do you expect the margins to improve year over year in '25? Thank you.

Andrew Philip Witty -- Chief Executive Officer

Joanna, thanks so much. Let me ask Tim Noel to respond to that.

Tim Noel -- Chief Executive Officer, Medicare and Retirement

Thanks, Joanna, for the question. You know, as we think about our long-term planning approach to Medicare Advantage, we remain consistent in our view of targeted margins. And that doesn't change as we were thinking about '25, like any other year. And -- which is good because then as we think about our forward view in any sequential year, not a lot of pricing catch-up that we need to engage in and we can really focus on stability for people, the people we serve, and the prospects who may want to choose us in the future.

So, really, not a lot of change here, very consistent with how we've thought about it previously.

Andrew Philip Witty -- Chief Executive Officer

All right. Tim, thanks so much, and, Joanna, thanks so much for the question. Unfortunately, that's all the time we have this morning, and I want to thank you all for a robust and productive discussion. I hope that during our session today, you heard a team that is very focused on both effectively navigating the challenges and distinct growth opportunities ahead for UnitedHealth Group.

A team leading an enterprise with the capabilities and energy to help each day to make healthcare better for the people we are privileged and proud to serve. Thanks so much for your time.

Operator

[Operator signoff]

Duration: 0 minutes

Call participants:

Andrew Philip Witty -- Chief Executive Officer

John F. Rex -- President and Chief Financial Officer

Andrew Witty -- Chief Executive Officer

A.J. Rice -- UBS -- Analyst

John Rex -- President and Chief Financial Officer

Joshua Raskin -- Analyst

Amar Desai -- Chief Executive Officer, OptumHealth

Lisa Gill -- Analyst

Stephen Baxter -- Wells Fargo Securities -- Analyst

Tim Noel -- Chief Executive Officer, Medicare and Retirement

Justin Lake -- Analyst

Bobby Hunter -- President, Medicare Business

Lance Wilkes -- Analyst

David Windley -- Analyst

Sandeep Dadlani -- Executive Vice President, Chief Digital and Technology Officer

Scott Fidel -- Analyst

Sarah James -- Analyst

Joanna Gajuk -- Analyst

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UnitedHealth Group (UNH) Q4 2024 Earnings Call Transcript was originally published by The Motley Fool