UnitedHealth Stock Plunges 13% on DOJ Medicare Billing Probe

UnitedHealth Group (UNH) shares took a nosedive on Friday, February 21, 2025, plummeting over 13% following a report that the U.S. Department of Justice (DOJ) has launched an investigation into the company's Medicare billing practices. The Wall Street Journal, citing anonymous sources, revealed that federal officials have begun a civil fraud investigation into how UnitedHealth records diagnoses that lead to extra payments for its Medicare Advantage (MA) plans. This probe comes on the heels of a series of articles from the Journal that reported billions of dollars in questionable diagnoses paid to UnitedHealth by Medicare.

The investigation, which focuses on billing practices in recent months, has raised concerns about potential fraudulent activities within the company. UnitedHealth, however, has criticized the Journal's reporting and maintains that any suggestion of fraudulent practices is "outrageous and false." The company stated that it consistently performs at the industry's highest levels on government compliance reviews of Medicare Advantage plans.



The DOJ investigation adds to a growing list of woes for UnitedHealth, which has faced an onslaught of public scrutiny over its denials of care and other issues. In recent months, the company has also grappled with the fallout from a cyberattack on its subsidiary Change Healthcare and the killing of UnitedHealthcare CEO Brian Thompson. These events, combined with rising care use and rate cuts, have put pressure on the company's UnitedHealthcare business, which covers more than 7.8 million people as the nation's largest provider of Medicare Advantage plans.

Investors and stakeholders should closely monitor the developments in this investigation and its potential implications for the company's financial performance and reputation. While the investigation is still in its early stages, the significant decline in UnitedHealth's stock price reflects investors' concerns about potential regulatory issues and their impact on the company's earnings. As the investigation progresses, it is essential to consider the potential regulatory and reputational risks for UnitedHealth and their impact on the company's stock price.

In conclusion, the recent decline in UnitedHealth's stock price is a clear indication of investors' concerns about the DOJ investigation into the company's Medicare billing practices. As the investigation unfolds, investors and stakeholders should stay informed about the potential regulatory and reputational risks for UnitedHealth and their impact on the company's financial performance and stock price.