UnitedHealth says it is facing DOJ investigation over Medicare billing practices

UnitedHealth Group revealed Thursday it is facing a Justice Department investigation over its insurance arm’s Medicare billing practices.

In a securities filing, the company said it has started complying with formal criminal and civil requests from the DOJ. UnitedHealth also said it has launched a third-party review of its business policies and performance metrics.

The company said it “has full confidence in its practices and is committed to working cooperatively with the Department throughout this process.”

UnitedHealth Group shares dropped nearly 4% in premarket trading Thursday.

It comes after the Wall Street Journal reported in May that the Department of Justice is conducting a criminal investigation into the health-care giant over possible Medicare fraud. In response at the time, the company said it stands “by the integrity of our Medicare Advantage program.”

In July, the Journal also reported that the DOJ interviewed several doctors about UnitedHealth’s practices and whether they felt pressured to submit claims for certain conditions that bolstered payments from the Medicare Advantage program to the company. 

That marked the second time this year that the insurer’s Medicare Advantage business has come under federal scrutiny. The Journal also reported in February that the DOJ is conducting a civil investigation into whether the company inflated diagnoses to trigger extra payments to its Medicare Advantage plans. 

But in March, UnitedHealth moved a step closer to ending a yearslong legal battle with the DOJ that began with a whistleblower who alleged the company illegally withheld at least $2 billion through the Medicare Advantage program. A special master assigned to the case by the judge issued a recommendation in favor of UnitedHealth, saying the DOJ lacked evidence. 

UnitedHealthcare’s Medicare and retirement segment, which includes the Medicare Advantage business, is UnitedHealth Group’s largest revenue driver, raking in $139 billion in sales last year.

The update in the probe comes after a tumultuous last year for UnitedHealthcare, the nation’s largest and most powerful private health insurer. Shares of UnitedHealthcare’s parent company, UnitedHealth Group, are down more than 42% for the year after it suspended its 2025 forecast amid skyrocketing medical costs, announced the surprise exit of former CEO Andrew Witty and grappled with the reported probe into its Medicare Advantage business. 

The company’s 2024 wasn’t any easier, marked by a historic cyberattack and the torrent of public blowback after the murder of UnitedHealthcare’s CEO Brian Thompson.

— CNBC’s Bertha Coombs contributed to this report.