UnitedHealth Group (UNH) had another rough day in trading Friday.
Reports that the Department of Justice (DOJ) is investigating its Medicare Advantage insurance business sent the stock more than 8% lower in early trading.
The civil fraud investigation, first reported by the Wall Street Journal, examines how UnitedHealth records diagnoses that boost payments from the Centers for Medicare and Medicaid Services (CMS). CMS pays private insurers lump sums to provide alternate Medicare coverage.
As of 2:15:11 PM EST. Market Open.
In a statement Friday, United Health called the report misinformation.
“The Wall Street Journal continues to report misinformation on the Medicare Advantage (MA) program. The government regularly reviews all MA plans to ensure compliance and we consistently perform at the industry’s highest levels on those reviews,” the statement said.
United Health added the company was not aware of any new activity by the DOJ.
Friday’s news marks the sixth time this year the stock has traded down and the second time this week. Earlier this week, the company reportedly offered buyouts to employees of its health insurance business, UnitedHealthcare, and considered layoffs if it didn’t reach the target for buyouts.
That’s just the latest headwind the company has battled in the past 12 months. Last year, UnitedHealth was the target of a widespread cybersecurity attack that impacted more than 190 million — a number the company only revealed at the start of this year.
The DOJ has also been scrutinizing the company for a potential breakup, and the Federal Trade Commission (FTC) could block its latest acquisition.
In addition, the company suffered a tragedy in December, with the shooting and death of its top insurance executive, Brian Thompson. The attack sent shockwaves through the industry amid a public backlash.
The company’s $460 billion market cap has been on the decline amid all these pressures, marking a significant shift in its growth prospects from prior years, when it was a favorite to become the first trillion-dollar healthcare company.
Anjalee Khemlani is the senior health reporter at Yahoo Finance, covering all things pharma, insurance, care services, digital health, PBMs, and health policy and politics. That includes GLP-1s, of course. Follow Anjalee on social media platforms X, LinkedIn, and Bluesky @AnjKhem.
Click here for in-depth analysis of the latest health industry news and events impacting stock prices
