Chairman and chief executive officer, UnitedHealth Group
Born: 1948, in Troy, New York.
Education: University of Texas at Austin, BA, 1970; University of Texas Medical Branch at Galveston, MD, 1974.
Family: Married Nadine M.; children: two.
Career: University of Texas Health Science Center, 1974–1978, internal medicine resident, chief resident, and pulmonary fellow; Scripps Clinic and Research Foundation, 1978–1980, researcher; Colorado Springs, Colorado, cardiopulmonary medicine, 1980–1985, practicing physician; Peak Health Plan, 1985–1988, president and COO; United HealthCare Corporation, 1988–1989, executive vice president; 1989–1991, president and COO; 1991–1998, chairman and CEO; UnitedHealth Group, 1998–, chairman and CEO.
Awards: 50 Best CEOs in America, Worth , 2001.
Address: UnitedHealth Group, 9900 Bren Road East, Minnetonka, Minnesota 55343; http://www.unitedhealthgroup.com.
■ In 2004 former pulmonologist Dr. William W. McGuire was the chief executive officer and chairman of the board of directors of the Minnetonka, Minnesota–based UnitedHealth Group, a company with more than 18 million medical members.
McGuire expanded UnitedHealth Group to the point where it offered a variety of health-care plans and services through four business segments. Those four units included Health Care Services, which managed HMO (health maintenance organization), PPO (preferred-provider organization), and POS (point-of-service) plans as well as various Medicare
and Medicaid options (members of the American Association of Retired Persons were served through the Ovations unit); Uniprise, which handled health plans for large companies; Specialized Care Services, which offered vision care, dental care, and transplant services; and Ingenix, which provided health-information consulting and publishing as well as drug-development and marketing services.
McGuire showed early leadership qualities as a teenager when he led his Clear Creek High School basketball team to a successful 28-3 season; as the six-foot-five-inch center, he was considered the brains behind the team. McGuire went on to become a Doctor of Medicine, graduating summa cum laude from the University of Texas Medical Branch at Galveston. Upon graduation McGuire worked from 1974 to 1978 as an internal medicine resident, chief resident, and pulmonary fellow at the University of Texas Health Science Center in San Antonio. Between 1978 and 1980 McGuire conducted basic research in immunopathology of the lung at Scripps Clinic and Research Foundation in La Jolla, California.
From 1980 through 1985 McGuire was a practicing physician in Colorado Springs, Colorado, specializing in cardiopulmonary medicine. During this time he served as chairman of the Colorado Foundation for Medical Care, Region 111 (1984–1985), as well as of its Professional Review Committee (1982–1984). McGuire held board certification in internal medicine and pulmonary medicine and was a member of the National Institutes of Health National Cancer Policy Board.
McGuire was then employed at Peak Health Plan in Colorado, where he served as vice president of Health Systems from 1985 to 1986; as medical director of Coastguard, Peak's insurance subsidiary, from 1985 to 1986; and as president and chief operating officer from 1985 to 1988. He joined United HealthCare Corporation when the company acquired Peak, thus beginning his flight up to the company's top corporate position.
McGuire joined United HealthCare Corporation, which later became known as UnitedHealth Group, in November 1988, becoming its executive vice president. McGuire was appointed a member of the board of directors and chief operating officer in May 1989. He became president of the company in November 1989, a position he held until May 1991. In February 1991 McGuire became chief executive officer and three months later, in May, added the position of chairman of the board of directors to his official responsibilities. McGuire retained these positions when the company was renamed UnitedHealth Group in 1998.
When McGuire took over the helm at UnitedHealth Group, the company was a regional health maintenance organization (HMO). At this time McGuire was concerned that the company did not offer sufficient options to its customers and decided to identify niches that could be entered to both plug up those gaps and bring more profit to the company. McGuire immediately began to direct company managers toward pricing services and products in accordance with anticipated costs while carefully managing the cost structure of those services and products. McGuire wholeheartedly believed that the results of these commitments in all of its business segments would become evident as the company continued to reorganize and streamline.
From the start McGuire felt that the most successful health-care companies were those that offered precisely the products and services that consumers wanted. During his first few years as leader of UnitedHealth, McGuire strived to provide flexibility in the choice of doctors and hospitals, broader access to services, and a wider range of services and products. At the same time he aimed to create a powerful growth strategy that would allow UnitedHealth to compete effectively in an increasingly crowded marketplace. That company would possess the size, level, and operating efficiencies necessary to consistently increase profits for shareholders.
To fulfill his vision McGuire negotiated the acquisition and expansion of about 30 or so businesses during his first 14 years as company leader. One of his largest deals was completed in 1998, when he brokered a merger with Humana. With the merger McGuire intended for UnitedHealth to become the most profitable health-care company in the United States by providing customers with accessible, high-quality, and affordable health-care services. McGuire predicted that the larger company would realize tremendous economies of scale, superior administrative efficiency, and an industry-leading service platform. He went on to say that the new company would be able to provide more affordable products to a larger number of people and in a more efficient manner.
Following the merger UnitedHealth operated in 48 states, Puerto Rico, and internationally, including in Hong Kong, Singapore, and South Africa. Its workforce numbered 50,000 and the company had a strong financial position with more than $13 billion in total assets and more than $6 billion in shareholder equity.
UnitedHealth went on to become one of the most diversified health-services companies in the United States. In 2003 McGuire saw the company gain about 35 percent in net-income growth, to about $1.8 billion, and 15 percent in sales growth, to about $28.6 billion. By 2004 the company claimed about one in seven U.S. citizens as customers—38 million people in all. The original $605-million-a-year regional HMO company had transformed into a diversified conglomerate that had given shareholders a roughly 35-fold return on investments since the time McGuire became its leader.
Although McGuire was unsure that results in 2004 would better those of 2003, he was confident that UnitedHealth remained well positioned. One of McGuire's key accomplishments as chief executive officer was the formation of a diverse portfolio of health plans, which helped to increase the customer base by almost 10 percent to 50 million. McGuire saw UnitedHealth grow into the country's largest health-services company. A second key accomplishment was the creation of a program that tracked the performance of cardiology centers so that patients could find the best locations for treatment.
It was expected that the climate around McGuire would continue to be stressful in the future, as increasing competition and diminished consolidation opportunities would hamper the company's growth rate. Health-care costs continued to rise at double-digit rates, which put further stress on profits. McGuire received much publicity as well as criticism for his hefty 2002 pay package of $58 million in cash and exercised stock options. He admitted that his salary was large but countered by noting that he had given his shareholders enormous gains since he came to lead the company.
Many people within the health-care industry considered McGuire a blunt person, especially outspoken with regard to the existing health-care system. During the 2003 keynote address at the annual institute of the American Association of Health Plans, McGuire challenged the health-plan community to "step above the micro, incremental issues of the day and help drive discussion to a higher level"; he went on to say, "Between the health-care system that exists today and the health-care system we imagine, there lies significant opportunity to make health-care services more accessible for all Americans, to improve the quality of care, and to help individuals take a more active role in their own health and well-being" (May/June 2003).
McGuire was considered a maverick among executives in the health-care industry. Almost all other heath-care companies stayed away from serving Medicaid recipients; in 2002 McGuire bought AmeriChoice Corporation, a company that served Medicaid recipients, believing that the federal government would eventually add to its funding of the program. Whether or not the government would see fit to do this, McGuire still believed UnitedHealth could make a profit producing high-quality service for a segment of the population he described as "vulnerable."
McGuire had a long interest in butterflies, formally known as the order of Lepidoptera. He made several discoveries in the field, was considered a well-regarded expert, and had several butterflies named after him—one of them a brown central-Texas insect now called Euphyes mcguirei . As his career took him higher in the professional health-care field, he never lost sight of his early interest in Lepidoptera. Particularly intriguing to McGuire was the group of small butterflies known as skippers in the families Hesperiidae and Megathymidae. While he and his family lived in the southwestern United States—Texas, Southern California, and Colorado—McGuire studied, collected, and made many notable discoveries, specifically with respect to his special butterflies. During this time and after moving to his present home in Wayzata, Minnesota, McGuire published a number of professional papers describing the biology and ecology of skippers, particularly the Holarctic genus Hesperia .
McGuire was a member of the board of directors of Healtheon Corporation in Santa Clara, California, and the Minnesota Business Partnership. McGuire also served as an advisor to the American Board of Internal Medicine in Philadelphia, Pennsylvania. He was elected to the Institute of Medicine in 1997 and served on the Health Care Services Board of the Institute of Medicine in Washington, D.C. He was a board member of the Minnesota Orchestral Association and a trustee of the Minneapolis Institute of Arts.
McGuire and his wife, Nadine, established the William W. McGuire and Nadine M. McGuire Family Foundation. One of their donations was a $3 million gift in 2002 to create the McGuire Institute for Biodiversity and the Environment at the University of Florida, for the study of the diversity of animals and plants as well as the environment. McGuire also donated his personal 30,000-insect collection to the university. Another donation was a gift of $4.2 million in 2000 to establish the McGuire Center for Lepidoptera and Environmental Research, which would house one of the world's largest collections of butterflies and moths. McGuire's foundation provided free copies of Clinical Evidence , a text of proven current medical practices, twice yearly to every doctor and many nurses in the United States.
Bethall, Tom, "Leading by Example: Health-Plan CEOs Helping to Reshape the Health-Care Policy Debate," Healthplan , May/June 2003, http://www.aahp.org/Content/NavigationMenu/Inside_AAHP/Healthplan_Magazine/May_June_2003__COVER_STORY__Leading_by_Example.htm .
—William Arthur Atkins