Posted on 05/21/2025 9:25:04 AM PDT by Red Badger
UnitedHealth shares fell more than 6% on Wednesday after the UK’s Guardian newspaper reported that the company made secret payments to nursing homes to reduce hospital transfers, adding to the woes of the healthcare conglomerate.
The alleged action, part of a series of cost-cutting tactics, has saved the company millions, but at times risked residents’ health, the Guardian reported, citing an investigation.
The allegations add to the litany of negatives that have hurt UnitedHealth in the last several months, following a massive cyberattack at its Change Healthcare unit, reports of criminal and civil investigations into the company’s practices, including one for Medicare fraud and the abrupt departure of CEO Andrew Witty last week.
Shares have stumbled all year, losing more than 39%, compared with a 0.6% decrease for the Dow.
UnitedHealth said in response that “the U.S. Department of Justice investigated these allegations, interviewed witnesses, and obtained thousands of documents that demonstrated the significant factual inaccuracies in the allegations.”
The company also said in an emailed statement that the DOJ declined to pursue the matter after reviewing all the evidence during its multi-year investigation.
Reuters has not independently verified the article’s allegations.
“The news is only seemingly getting worse for UnitedHealth,” said Sahak Manuelian, managing director, global equity trading at Wedbush.
“This is kind of a tough situation for investors to come in and have any kind of confidence in putting money to work, so we’ll have to kind of wait and see how this plays itself out, unfortunately,” Manuelian said.
Separately, HSBC downgraded the stock to “reduce” from “hold,” and cut the price target to a street-low of $270.
The brokerage said higher medical costs, pressure on drug pricing and its pharmacy benefit management unit, OptumRx, and a potential Medicaid funding cut can upset the company’s recovery journey.
The company is now counting on the experience of Stephen Hemsley, who returned as CEO to steer it through the current crisis.
“We believe Hemsley has the experience and leadership attributes that the company needs to restore credibility and right the ship,” said James Harlow, senior vice president at Novare Capital Management.
It needs to fall!
The more that gets uncovered about UH...well...
How many other insurance companies pull the same stunts?
these are payments for murder before the fact,
and where are the Trials, or Tribunals?
All of them...................
Gotta wonder if this would have happened before the assignation of their CEO.
U mean the guy deserved to die?
More love letters for Luigi.
Short term of course, because long term this kind of action tends to send your company into the crapper. But short term it is great. You just have to make your exit at the right time.
Why do you think they supported Obama(DON'T)Care?
RICO?
Share price should not be involved in medical care.
More here...
I’d be very careful on this one.
Don’t make any assumptions.
Still more...
https://www.healthcarefinancenews.com/news/unitedhealth-shares-drop-again-kickback-allegations
The best places to do business are with those businesses that are not listed on any stock exchange.
Should not be that way but it is.
Well, one key player, who was rumored to be cooperating with the Feds, was executed by a guy from an Italian family.
This story reminded me that Mario Cuomo forced Covid ravaged patients out of hospitals, back into nursing homes, where they exposed all of the other vulnerable patients.
That type of company shouldn’t be for profit.
UnitedHealth has ben a failed company from when they merged with metrahealth in 1996, metrahealth was travelers health and metlife health. screwed up a wonderful Midwestern company.
WRONG
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