Dive Transient:
- UnitedHealth on Thursday stated it’s underneath federal investigation from the Division of Justice about its Medicare program.
- The corporate stated in a securities submitting it was complying with the Justice Division on formal felony and civil requests and had reached out proactively to the DOJ following media studies that UnitedHealth was dealing with investigations into its Medicare program.
- UnitedHealth stated it’s launched its personal evaluation of its insurance policies and that it has “full confidence” in its practices. The corporate’s inventory fell greater than 2% in Thursday morning buying and selling.
Dive Perception:
UnitedHealth’s Medicare program has reportedly been underneath scrutiny from federal investigators for attainable felony fraud this yr.
In February, The Wall Avenue Journal reported that the Justice Division had launched an investigation into UnitedHealth’s Medicare billing practices, together with potential overpayments in its Medicare Benefit program and at doctor practices the insurer owns. The Journal then reported once more in Might and July that the Justice Division had launched a felony investigation into the corporate for attainable Medicare fraud and was questioning staff about the way it documented medical diagnoses.
MA has come underneath rising scrutiny from regulators and lawmakers for costing the federal government greater than conventional Medicare — this yr, the federal government is about to spend $84 billion extra on MA beneficiaries than in the event that they had been enrolled in conventional Medicare.
Regulators and lawmakers have positioned the blame on insurers. This system has been profitable for insurance coverage corporations, who’ve additionally been accused of proscribing take care of seniors and exaggerating diagnoses to garner increased reimbursement.
Along with investigating its Medicare practices, UnitedHealth has additionally reportedly been the goal of antitrust investigations from the DOJ. The corporate, which owns the biggest personal insurer within the U.S., a doctor community, a pharmacy profit supervisor, and a billing and analytics enterprise, was reportedly being investigated for anticompetitive results between UnitedHealth and Optum, its well being providers arm that features a doctor group.
The acknowledgment of the investigation is a uncommon step by UnitedHealth, which has declined to remark publicly on potential DOJ investigations.
The corporate has struggled this yr amid increased medical prices in its insurance coverage enterprise and new rules on medical coding put in place by the Biden administration.
As soon as a bellwether inventory for the trade, the corporate pulled its revenue steerage for 2025 after underperforming on its first-quarter earnings and later changed its CEO Andrew Witty. Funding banks have downgraded the corporate, and UnitedHealth’s inventory is down about 43% from the start of the yr.
UnitedHealth will report its second-quarter earnings outcomes on July 29.
