UnitedHealth Group Facing Criminal Probe for Medicare Fraud

It's the latest concerning development in a tumultuous stretch for the healthcare giant.

UnitedHealth Group continues to make headlines for all the wrong reasons.

Following a poor financial performance in the first quarter and a leadership change that left the company in disarray, UnitedHealth Group is now under investigation for possible criminal Medicare fraud, according to a new report by The Wall Street Journal.

People familiar with the matter told the news outlet that the probe by the Department of Justice's (DOJ) criminal division centers on UnitedHealth's Medicare Advantage (MA) business and has been ongoing since at least last summer.

In response to the report, UnitedHealth Group released a statement saying it was unaware of any such investigation.

"We have not been notified by the Department of Justice of the supposed criminal investigation reported, without official attribution, in the Wall Street Journal today."

"The WSJ’s reporting is deeply irresponsible, as even it admits that the 'exact nature of the potential criminal allegations is unclear.'"

"We stand by the integrity of our Medicare Advantage program."

The probe adds to the growing number of investigations facing the healthcare giant.

A year ago, WSJ reported that the DOJ was looking into antitrust violations regarding the relationship between UnitedHealthcare and Optum, which is under question for creating an unfair advantage over competitors and potentially harming consumers.

WSJ also reported in February that UnitedHealth is facing a civil fraud investigation that is examining the company's practices for upcoding, resulting in extra payments to its MA plans.

Meanwhile, UnitedHealth is attempting to stabilize after undergoing a sudden leadership change, with CEO Andrew Witty stepping down this week for personal reasons. Stephen Hemsley, who previously served as the company's CEO, returned to the role to guide the UnitedHealth through an unsettling period.

The struggles extend to UnitedHealth's bottom line. The company significantly underperformed in its first quarter earnings, which were weighed down by rising costs in MA and a jump in utilization, causing UnitedHealth to suspend its guidance for the year.

Additionally, the company faced scrutiny after its Change Healthcare subsidiary suffered a cyberattack in February last year, disrupting payments to providers and compromising the personal data of millions of people.

At the end of 2024, the killing of UnitedHealthcare CEO Brian Thompson put the company even more under the microscope.

Now, with its stock plummeting and multiple federal investigations directed its way, UnitedHealth's stranglehold on the industry is in a precarious position.