Health Care

UnitedHealth’s Stephen Hemsley joins a long tradition of former chief executives returning to lead their companies through a crisis. The record of other “boomerang” CEOs suggests he faces a tricky challenge. UnitedHealth tapped its 72-year-old chairman and former CEO to help the health-insurance giant recover from a series of business challenges, including federal investigations and the fallout from the shooting death of a top executive. Hemsley, who led UnitedHealth for more than a decade until 2017, follows other executives in making a repeat run, including Disney’s Bob Iger, Starbucks’s Howard Schultz and UBS’s Sergio Ermotti. Corporate boards bring back former CEOs in difficult times for good reason: They often understand the company inside and out and can capitalize on lingering goodwill and relationships throughout the organization. Many companies believe relying on a tried-and-true leader is a faster path to a turnaround than hiring someone who might need months to get […]

UnitedHealth Group (UNH) on Friday refuted claims by The Wall Street Journal that the US Department of Justice had launched an investigation into the health insurer’s Medicare billing practices. The Journal reported Friday, citing sources, that the DOJ was looking into UnitedHealth’s protocol for recording diagnoses that prompt additional payments to its Medicare Advantage, or MA, plans. The Journal said that the new civil fraud investigation was launched in recent months. Prior WSJ reports show that Medicare paid the company “billions of dollars” for dubious diagnoses, according to the latest report by the Journal. The Department of Health and Human Services’ Office of Inspector General is also involved in the latest probe, the Journal reported Friday. UnitedHealth’s shares were down 8.9% in afternoon trade. “We are not aware of the ‘launch’ of any ‘new’ activity as reported by the Journal,” the company said in a statement. “Any suggestion that our

UnitedHealth Group stock tumbled in premarket trading Friday following a report that said the Justice Department had launched a civil fraud investigation into the company’s Medicare billing practices. The stock fell 8.8% to $458 in premarket trading. The DOJ probe aims to examine the healthcare company’s practices for documenting diagnoses that trigger extra payments to its Medicare Advantage plans, The Wall Street Journal reported, citing people familiar with the matter. Under the current system, the federal government pays insurers a fixed amount each month to oversee enrollees’ Medicare benefits. These payments can increase when patients have certain diagnoses. An official Medicare booklet notes that each Medicare Advantage plan “can charge different out-of-pocket costs and have different rules for how you get services.” Barron’s has reached out to the Justice Department and UnitedHealth for comment. News of the investigation comes months after the DOJ moved to block UnitedHealth’s acquisition of home

UnitedHealth Group is scheduled to report its financial results on Thursday, a month and a half after the killing of the head of its health insurance division. Recent months have raised other challenges for UnitedHealth, which is the largest healthcare company in the country, and has operations that touch virtually every corner of the healthcare system. It owns an insurer, a pharmacy benefit manager, a key software provider, and physician practices, among other businesses. In mid-December, President-elect Donald Trump threatened to “knock out” pharmacy-benefit managers from their role as middlemen in the drug market, a risk for UnitedHealth because its OptumRx is among the largest such companies. The healthcare news website STAT reported in late December that a number of Democratic U.S. senators were calling for a potential breakup of UnitedHealth. The advent of the Trump administration could bring other changes. Investors are anticipating a friendlier atmosphere for Medicare Advantage,

UnitedHealth Group (UNH) shareholders have proposed that the health insurance company report on “public health-related costs and macroeconomic risks” caused by practices that “limit or delay access to healthcare.” The shareholder proposal said the report should evaluate how the company’s practices “impact access to healthcare and patient outcomes.” It said the report should include how often authorization requirements or denials of coverage have led to a delay or abandonment of medical treatment, as well as serious adverse events for patients as a result. “UNH has been in the media and legislative spotlight for some time given its market dominance, aggressive marketing of Medicare Advantage and questionable use of AI algorithms to deny care to patients,” said Timnit Ghermay of the Sisters of the Holy Names of Jesus and Mary. “Our proposal suggests some introspection by UNH that will help the company and all its stakeholders thrive.”

UnitedHealth Group (UNH) is seeing a steeper-than-expected medical cost trend amid elevated Medicare coding intensity and temporary Medicaid acuity headwinds, RBC Capital Markets said in a note Wednesday. RBC said it is raising its 2025 Medical Care Ratio estimate by 70 basis points to 84.7% and lowering its adjusted earnings per share estimate to $29.75 from $30.84 previously. “Our estimate reflects elevated Medicare coding intensity, which has persisted beyond resumption prior authorization, as well as Medicaid acuity headwinds, which should be transitory,” RBC analysts said in the note. UnitedHealth’s management cited three headwinds, including an about 20% rise in Medicare coding intensity, elevated Medicaid acuity from timing mismatches, and increased specialty drug prescribing, RBC said, adding that these specialty headwinds should not affect the medical cost ratio beyond Q4 as the company has priced for Inflation Reduction Act drug provisions in its 2025 bids. RBC reiterated its outperform rating on

UnitedHealth Group’s 2025 earnings guidance came in below analyst forecasts, weighing on its shares as the healthcare heavyweight deals with a variety of factors that are hurting profitability. The company says recent Medicaid redeterminations have left it with fewer, but sicker, members, while funding from Medicare has declined despite elevated hospital spending, Mizuho analyst Ann Hynes says in a research note. There has also been an increase in the utilization of expensive specialty drugs, the analyst says. UnitedHealth says it expects to continue facing these cost pressures as certain care patterns persist at higher levels than previously expected, the analyst says. Shares fall 7% to $562.48.