UnitedHealth shares turned lower in midday trading following reports of another probe into the nation’s biggest health insurance group and its ties to government-funded healthcare programs.
The Wall Street Journal reported that Sen. Chuck Grassley (R-Iowa) would launch a formal inquiry into the group’s Medicare Advantage billing practices.
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Grassley, who chairs the Senate Judiciary Committee, has written a letter to UnitedHealth Group (UNH) Chief Executive Andrew Witty seeking medical records, training manuals and other documents, the Journal reported, citing findings from its reporting last week.
That report, which UnitedHealth Group firmly denied, suggested that the U.S. Department of Justice was looking to probe the group’s diagnosis recordings that trigger extra Medicare Advantage payments.
The DoJ investigation would focus on whether those diagnoses are followed-up with actual patient care.
“We welcome the opportunity to share the facts with Senator Grassley, especially given the ongoing misinformation campaign by” UnitedHealth said in a statement to the Journal.
UnitedHealth Group CEO Andrew Witty has reportedly received a letter from Iowa senator Chuck Grassley demanding documents tied to its Medicare Advantage billing practices.
Medicare Advantage is a program in which private insurers like UnitedHealth offer managed care for elderly Americans seeking coverage beyond the standard government Medicare offering, such as vision, dental and prescription drugs. The government pays insurers a fixed rate per enrolled beneficiary each month.
Related: UnitedHealth stock plunges on report of DoJ Medicare Advantage probe
Payments under Medicare Advantage totaled $12.8 billion in 2023, a 30% increase from the previous year, but likely slipped in 2024 thanks to changes in the way insurers are compensated.
Last year, a report from the Office of Inspector General for the Department of Health and Human Services said UnitedHealth, as well as other Medicare Advantage insurers, collected $7.5 billion in dubious payments in 2022 tied to health risk assessments. UnitedHealth took in $3.7 billion.
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The U.S. Federal Trade Commission has also accused the three largest pharmacy-benefit managers, including UnitedHealth, of inflating the cost of medicines, sometimes prescribed for serious illnesses such as heart disease, cancer and HIV, and reaping more than $7.3 billion in extra profit.
UnitedHealth shares were last marked 1.5% lower in midday trading to change hands at $454.94, a move that would extend the stock’s year-to-date decline to around 10.1%.
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