UnitedHealth Group announced on Thursday that it is currently under criminal and civil inquiries from the Department of Justice (DOJ) concerning its Medicare claims practices.
In its securities filing, the healthcare company mentioned they have started to address the formal criminal and civil demands.
Following this news, UnitedHealth’s shares dropped by nearly 4% on Thursday.
The company stated, “We have a lengthy history of responsible conduct and effective compliance.” Furthermore, they noted that independent audits from CMS validate their practices as among the most accurate in the industry. After a civil review spanning a decade concerning parts of the Medicare Advantage sector, a court-appointed special master found no evidence supporting any fraud claims.
In response, UnitedHealth has initiated a third-party review aimed at examining “policies, practices, and performance metrics” related to risk assessment coding, managed care practices, and pharmacy services.
This statement comes after previous disclosures when the company initially acknowledged the DOJ investigation’s existence. Recent articles have shed light on the situation over the past few months.
The company stated that it “actively” reached out to the DOJ after looking into media reports surrounding the investigation.
According to reports, in February, the DOJ began a civil inquiry to determine if UnitedHealth had inflated diagnoses to secure higher payments for its privately operated Medicare Advantage plans, with the criminal investigation reported in May.
As the largest insurance provider in the Medicare Advantage market, UnitedHealth is navigating a turbulent year, including a halt on revenue projections for 2025 due to rising medical costs for enrollees in new plans.
Thursday’s announcement came just ahead of a revenue call for the second quarter scheduled for July 29, possibly signaling a strategic shift under new CEO Stephen Hemsley, who stepped in this May after Andrew Whitty’s unexpected resignation.
