- Shares of health insurance providers tumbled on a report UnitedHealth Group is being investigated by U.S. officials over possible fraud.
- The Wall Street Journal said the Department of Justice was looking into the company’s Medicare Advantage business.
- UnitedHealth Group shares also plunged on Tuesday after the insurer withdrew its guidance and Andrew Witty resigned as CEO.
Shares of UnitedHealth Group (UNH) cratered again Thursday, dragging those of rivals as well, on the latest bad news for the health insurer.
The Wall Street Journal reported the U.S. Department of Justice (DOJ) was investigating UnitedHealth Group for possible Medicare fraud.
The paper explained that while the potential criminal charges weren’t clear, its sources said officials were looking into the company’s Medicare Advantage business practices. It added that the probe has been open “since at least last summer.”
In a strongly worded statement in response, UnitedHealth Group said it has not been contacted by the DOJ about any investigation, calling the Journal’s reporting “deeply irresponsible.” It added that it stands “by the integrity of our Medicare Advantage program.”
It’s been a tough week for UnitedHealth Group investors. Shares cratered 18% Tuesday when the company withdrew its guidance as it faced higher costs, and CEO Andrew Witty suddenly stepped down. They rallied early yesterday, but eventually turned lower. Shares have lost a third of their value since Monday’s close.
UnitedHealth Group was the worst-performing stock in the S&P 500 in late-morning trading Thursday, and shares of Humana (HUM), Molina Healthcare (MOH), and Elevance Health (ELV) were down as well.
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