UnitedHealth Group Faces DOJ Investigation, Stock Plunges
UnitedHealth Group (UNH) experienced a significant decline in stock value on Friday (-9.11%) following reports of a Department of Justice (DOJ) investigation into its Medicare Advantage insurance business.
The investigation, first reported by the Wall Street Journal, focuses on whether UnitedHealth manipulates diagnoses to increase payments from the Centers for Medicare and Medicaid Services (CMS). CMS provides lump-sum payments to private insurers for alternative Medicare coverage.
In response, UnitedHealth vehemently denied the allegations, stating that the report contains misinformation. The company claims regular government reviews have consistently shown its adherence to industry standards.
UnitedHealth also stated that it is unaware of any new DOJ activity.
This news follows a series of challenges faced by the company in recent months, including:
* Employee buyouts and potential layoffs
* A major cybersecurity attack
* DOJ scrutiny of a potential breakup
* The tragic shooting of its top insurance executive
The company's market cap has plummeted amid these pressures, marking a change from previous years when it was seen as a frontrunner to become the first trillion-dollar healthcare company.