UnitedHealth Group Investigation Impacts Stock Prices
In a recent development, UnitedHealth Group Inc. (UNH) experienced a decline in stock prices after reports emerged indicating an investigation into its billing practices by the US Department of Justice.
According to sources familiar with the matter, the civil fraud probe centers on UnitedHealth's recording of diagnoses that may result in increased payments from the Medicare Advantage program. The investigation is examining potential irregularities within the payment system of the program.
The news has sent shockwaves through the market, with UNH shares plummeting by as much as 8.9% before the opening of US markets. The company had witnessed a moderate decline of 0.7% year-to-date through Thursday's close.
The government has been actively scrutinizing costs associated with Medicare Advantage, a privately managed alternative to the Medicare program for seniors. Congressional advisors have expressed concerns regarding the susceptibility of the program's payment system to manipulation. A 2024 report highlighted the "urgent need for a major overhaul" to address these issues.