The Department of Justice has reportedly launched an investigation into UnitedHealth Group’s Medicare billing practices as scrutiny over the health insurance industry intensifies — sending the company’s stock plummeting.
The probe is analyzing the company’s practice of frequently logging diagnoses that trigger larger payments to its Medicare Advantage plans, according to The Wall Street Journal.
UnitedHealth shares plunged nearly 9% Friday.
A series of Wall Street Journal reports last year found that Medicare paid UnitedHealth billions of dollars for questionable diagnoses.
Certain diagnoses produce larger lump-sum payments for insurers in the Medicare Advantage system.
“The Journal has engaged in a year-long campaign to defend a legacy system that rewards volume over keeping patients healthy and addressing their underlying conditions,” UnitedHealth said in a statement. “Any suggestion that our practices are fraudulent is outrageous and false.”
The DOJ did not immediately respond to requests for comment.
UnitedHealth has faced particularly intense scrutiny, at least in the public eye, since the chief executive of its insurance company, Brian Thompson, was executed in Midtown Manhattan in December.
His alleged assassin Luigi Mangione was slated to appear Friday in a Manhattan court, which was mobbed by twisted fans of the hunky Ivy League graduate.
Social media users have slammed UnitedHealth for denying their loved ones’ claims, and have used the killing as a call to arms against the health insurance industry — with many posting jokes about the murder online.
UnitedHealth – a $400 billion company that owns the largest US health insurer, doctor practices and a pharmacy-benefit manager – also faces a DOJ-led antitrust probe. The Justice Department has sued to block the group’s $3.3 billion acquisition of Amedisys, a home health care company.
A Wall Street Journal analysis late last year showed patients examined by doctors working for UnitedHealth saw a jump in high-payout diagnoses after they signed on to the company’s Medicare Advantage plans.
Doctors had told the news outlet that UnitedHealth trained them to report these lucrative diseases. The health insurance giant also used software that would suggest conditions to doctors, and paid doctors bonuses for going with the suggested diagnoses, doctors said.
UnitedHealth also allegedly recorded diagnoses in patient records that had never been treated by a doctor, according to the Journal. In 2021, those untreated diagnoses churned out an extra $8.7 billion in federal payments.
The healthcare group has previously claimed its diagnoses practices help detect diseases earlier, which saves the health system money.
In a press release published in December, UnitedHealth claimed the Journal’s articles “rely on often incomplete and inaccurate data to conduct flawed studies through a murky government ‘agreement.’”
The Journal said its reports used data UnitedHealth and Medicare Advantage insurers openly submitted to the federal government.
UnitedHealth has been questioned over its diagnosis techniques in the past. The Justice Department took over a previous lawsuit by a former UnitedHealth employee that claimed the company did not retract inaccurate diagnoses that were recorded in patient history forms.
