Too Big to Fail, Too Broken to Fix?

UnitedHealth Group’s very bad year, what it means for healthcare reform, and 3 predictors happening right now.

“One of America’s biggest companies is imploding.”

So read the CNN headline this week. That would be disconcerting enough if the company in question — UnitedHealth Group — didn’t also manage the health of tens of millions of Americans.

In just over a year, the organization that many believed would be the first healthcare company to join the trillion-dollar club has been downgraded by analysts, continues to weather a massive data breach by subsidiary Change Healthcare, and is reportedly under DOJ investigation for Medicare fraud. CEO Andrew Witty just resigned, abruptly and effective immediately. And of course, nearly six months ago, UnitedHealthcare CEO Brian Thompson was murdered.

It is extremely telling that Forbes, in its subsequent calls for industry reform, singled out not only a single company (UnitedHealth Group) but a single human being (Witty). But if a company is too big to fail, is it also too big for healthcare reform to succeed — especially when that company uses its size and scale to delay and deny care?

Four reasons why reform fails

Except for the creation of Medicare, Medicaid and the ACA, KFF writes that most national healthcare reform has stalled since the 1930s due to four recurring conflicts:

1. The size and role of the federal government, including spending and cost controls
    
2. The size and role of private industry, including competition and affordability
    
3.  Mandates and definitions of basic coverage
    
4. Competition with other reforms and economic pressures (costs, inflation, recession)
    

Describing reform attempts in the 1970s, KFF notes that they were “completely stalled in the face of an economic recession and uncontrollable health care costs.” This could just as easily describe 2025.

Case in point: CMS recently terminated the Medicare Advantage Value-Based Insurance Design (MA VBID) model. The agency cited “substantial and unmitigable costs” — more than $2 billion annually in both 2021 and 2022 — that “no viable policy modifications” could address.

Uncontrollable costs prevent us from controlling costs. Policy cannot fix what policy helped create.

This HealthLeaders series began with the question: “Will Post-Brian Thompson Reforms Go the Way of DEI?” It continued by suggesting that threats to “healthcare’s DEI”— the social drivers of health — could provide an answer. The analysis concludes by identifying three more predictors whose fates are emerging in real time.

Reform predictor #1: The future of Medicaid waivers

Today, both workforce equity and health equity face significant threats. Part 2 of this series explored those threats, including federal cuts to 1115 waivers that allow states to cover healthcare needs rooted in the social drivers of health (SDOH).

KFF’s Section 1115 Waiver Watch agrees, noting: “Recent actions from the Trump administration could signal efforts to curtail waivers related to social determinants of health and to limit waiver financing tools and flexibility.”

The fate of these waivers may depend on three of KFF’s “reform stallers”: the role of the federal government, coverage mandates, and the financial pressures that shape both. That brings us to the next predictor . . .

Reform predictor #2: The Braidwood decision

Rolling back 1115 waivers for SDOH services would undo years of precedent. And the Supreme Court’s Roe v. Wade reversal showed that decades of protected healthcare services are no longer assured.

The same risk is at stake in Braidwood Management, Inc. v. Becerra, which challenges whether private payers must provide free preventive services. As with waivers, Braidwood tests the role of government authority and mandated coverage in healthcare reform. It also adds the impact of private industry.

In April 2023, House and Senate Democrats asked insurers if they would continue covering preventive services. The answer: Yes. But in a July amicus brief in Braidwood, the Blue Cross Blue Shield Association warned that if enough stakeholders reimpose cost-sharing, “it could create perverse competitive incentives for others to follow suit.”

HealthLeaders covered this development with the headline: “Will Payers Waffle?” The same question can be asked of post-Brian Thompson reforms. An early answer was not promising.

Predictor #3: Shareholder activism

“The health care system is flawed. Let’s fix it.” So wrote Andrew Witty in his Dec. 13 New York Times op-ed following Brian Thompson’s murder. The now-former UnitedHealth Group CEO expanded on these comments in the company’s January earnings call, highlighting areas of the industry that could be “enhanced, reworked, reengineered, or even scrapped.”

The same month, United began what would be a successful block of a shareholder proposal that would have required the company to analyze the impact of its prior authorization practices on member access, outcomes and broader public health. The block was aided by Securities Exchange Commission guidance issued after the proposal.

The shareholders, Interfaith Center on Corporate Responsibility, flagged this development, adding that its proposal was “much-needed . . . to consider the systemic risks created by denial and delaying care for policyholders.” The group added that “we fully intend to keep this issue in front of the company in our upcoming dialogues.”

These and other efforts reinforce that commitments to systemic healthcare reform made by one group of stakeholders will require all stakeholders.

“The hardest part of systemic change is that it requires other people to come on board,” says Courtney Henry, founder of GrowthMinded and co-leader of The Success Solution with Debra Joy.

“This gives corporations and larger entities more strength than individuals,” adds Henry.

The Interfaith Center on Corporate Responsibility has called out the “public health-related costs and macroeconomic risks of United’s care delays and denials — specifically long-term risks like increasing consumer debt.”

But the risk is far greater.

Houston, we have a (systems) problem

In addition to accounting for 17.6% of GDP, healthcare spending is a major driver of U.S. national debt. Healthcare alone is projected to surpass all other federal spend by 2028 and rise by 73% in the next decade.

In 2024 and 2025 respectively, the Eurasia Group’s top risks were “The United States Versus Itself” and the emerging “G-Zero” world — one in which people have historically low trust in core institutions and “no one power or group of powers is both willing and able” to lead.

Trust and leadership are lacking when they are needed most — in global politics, U.S. healthcare, and perhaps our very culture.

“I think the dysfunction is not only corporate but within society as a whole,” adds Courtney Henry.

“There is systemic dysfunction in the way we take care of our bodies, which is leading to sickness. There's systemic dysfunction in the way our economic system works, which requires us to work 12-hour days just to make ends meet. There is systemic dysfunction in large organizations, where you have 40,000 employees pushing paper every day who aren't connected with the actual mission and are just focused on bottom lines within a department.”

Workplace diversity, equity and inclusion was supposed to be part of the solution.

So, will post-Brian Thompson reforms go the way of DEI? The fate of Medicaid waivers, free preventive care, and shareholder activism may help answer the question. It will take time — perhaps too much already.

Seven years ago, HHS declared the opioid crisis a Public Health Emergency. It has renewed that call 30 times. Seven years ago, U.S. health insurers also signed a consensus statement with the American Medical Association, promising to “help patients get access to safe, timely, and affordable care while reducing administrative burdens for both health care professionals, hospitals and health insurers."

AMA president Dr. Bruce A. Scott invoked that consensus following Brian Thompson’s death.

“Now” — Scott declared, in light of past and future promises — “we await action.”