UnitedHealth shares drop after report of criminal probe

Reuters

Thu, May 15, 2025, 3:18 AM 2 min read

(Reuters) - UnitedHealth Group shares fell astir 6% successful premarket trading connected Thursday, aft the Wall Street Journal reported that the U.S. Department of Justice was investigating the institution for imaginable Medicare fraud.

The latest quality adds to the wellness insurer's litany of woes, including aggregate authorities inquiries into its business, a abrupt alteration successful apical enactment and a pulled outlook successful the look of soaring aesculapian costs.

"UnitedHealth Group is mired successful a situation seemingly without end. Investors are bracing for different large bout of turbulence fixed reports of the DOJ investigation," said Susannah Streeter, caput of wealth and markets astatine Hargreaves Lansdown.

The company, however, said it had not been notified by the DOJ astir the "supposed transgression probe reported" and that it stood by "the integrity of our Medicare Advantage program".

The healthcare conglomerate's banal sank 18% to a four-year debased connected Tuesday pursuing the news. If premarket losses hold, UnitedHealth's marketplace capitalization volition halve from $530 cardinal recorded connected April 16, a time earlier a astonishment net miss sparked a selloff successful its shares.

UnitedHealth connected Monday reinstated Stephen Hemsley arsenic CEO, tasking the longtime person with steering the healthcare elephantine done crises including national probes, soaring costs and a cyber attack.

The wellness security manufacture has travel nether aggravated scrutiny, pursuing a suit earlier this period alleging that 3 large U.S. wellness insurers paid hundreds of millions successful kickbacks to brokers to funnel patients into their plans.

In February, the WSJ revealed a civilian fraud probe into UnitedHealth's Medicare practices, portion U.S. Senator Chuck Grassley launched an enquiry into the company's billing methods, demanding elaborate compliance records, successful the aforesaid month.

For decades, the institution has flourished by leveraging its dominance successful insurance, enlargement into adjacent areas and maturation successful the Medicare market, the U.S. authorities programme that covers aesculapian costs for the elderly.

This streak of beardown show came nether unit conscionable months aft a elder enforcement was tragically killed, allegedly by a antheral enraged implicit insurer practices.

(Reporting by Joel Jose and Siddarth S successful Bengaluru; Editing by Anil D'Silva)