UnitedHealthcare is providing employees within its benefits operations department the opportunity to accept buyouts if they resign by March 3, following a challenging year for the insurance leader, as reported by CNBC.

Employees who choose not to take the buyout will remain in either their existing role or a similar position, according to sources familiar with the situation. If the company fails to reach its resignation target through these buyouts, it will resort to layoffs, sources indicated, referencing internal communications.

The company has not disclosed the number of workers who received buyout offers as part of its Voluntary Resignation Separation Program. The benefits operations division manages various areas, including customer service, claims processing, enrollment, and insurance benefits, according to one insider.

As the largest private health insurer in the United States, UnitedHealthcare is a subsidiary of UnitedHealth Group. As of December 2023, UnitedHealth Group employed over 440,000 individuals; however, specific figures regarding staffing in the benefits division or the overall insurance segment remain undisclosed.

Ranked as the largest healthcare conglomerate in the U.S. by revenue, with a market cap approximating $460 billion, UnitedHealth Group is actively attempting to reduce costs amid rising medical expenditures for Medicare Advantage enrollees. The company is also managing the repercussions of a significant cyberattack targeting its subsidiary, Change Healthcare. Moreover, recent incidents, including the tragic death of the insurance unit’s CEO, Brian Thompson, have led to heightened scrutiny concerning the high costs associated with healthcare in the U.S.

Eligible employees for the buyouts consist of both full-time and part-time U.S. workers in four key segments of benefits operations: corporate, consumer operations, core services, and provider services, as outlined in an internal memo reviewed by CNBC.

In a statement to CNBC, a UnitedHealth representative stated, “This voluntary option is part of our ongoing efforts to ensure our team is well-equipped to meet the changing needs of those we serve.” The company is also actively recruiting, with over 3,200 job openings highlighted on UnitedHealth Group’s careers page.

According to the memo, employees who opt for the buyout can expect their termination dates to be no earlier than May 1. Some who accept buyouts may need to continue working past this date, but the company does not anticipate requiring work past November 13.

Severance packages will be based on the length of tenure and salary level, kicking in on the termination date. The benefits associated with potential future layoffs may not be as generous as those included in the buyout program, as noted in the memo.

Sources indicate that employees were taken aback by the buyout offers, particularly in light of UnitedHealth Group’s record high annual revenue reported in 2024. The company announced in January that it had generated $400.3 billion, marking an 8% increase from the previous year.

During the fourth-quarter call in January, UnitedHealth’s executives stated that “digital adoption” has been key in reducing costs, with CEO Andrew Witty mentioning a “modernization agenda” that includes initiatives like artificial intelligence.

Witty also noted that UnitedHealth is “just scratching the surface” in terms of growth opportunities.

On Monday, workers were informed about the buyouts in a brief 10-minute meeting, with plans for additional information sessions in the following days to address any questions.

These buyout offers follow the shooting incident involving Thompson, which has fueled widespread frustration and calls for insurance industry reform. This incident came on the heels of a cyberattack in February 2024 that affected the personal health information of approximately 190 million individuals. UnitedHealth Group has since compensated providers over $3 billion due to the cyber incident.

The company also faced layoffs within its Optum health services division last year.

On Wednesday, the company’s stock rose by nearly 1%.