(Bloomberg) — The US Justice Department\u2019s criminal division is digging into UnitedHealth Group Inc.\u2019s prescription management services as well as how it reimburses its own doctors under an ongoing probe into the firm\u2019s operations, according to people familiar with the matter.<\/p>\n
The previously unreported areas of the probe show the scrutiny is broader than was known and goes beyond an inquiry into possible Medicare fraud. Investigators are looking into business practices at the company\u2019s pharmacy benefit manager Optum Rx, in addition to the physician payments, said the people, who asked not to be identified discussing a confidential matter.<\/p>\n
Most Read from Bloomberg<\/p>\n
The Justice Department hasn\u2019t accused UnitedHealth or its executives of wrongdoing and the existence of a probe doesn\u2019t mean that charges will be filed.<\/p>\n
But the broader scrutiny of UnitedHealth\u2019s operations in prescription benefits management and doctor reimbursements could complicate the matter for the company.<\/p>\n
UnitedHealth shares dropped 1.5% at the New York market close, reversing earlier gains.<\/p>\n
\u2018Full Confidence\u2019<\/p>\n
UnitedHealth referred Bloomberg to a July filing in which the company said it was responding to civil and criminal Justice Department probes and has \u201cfull confidence in its practices.\u201d The Justice Department declined to comment.<\/p>\n
The Wall Street Journal reported in May that the department\u2019s criminal fraud unit has been investigating UnitedHealth\u2019s Medicare Advantage billing practices since at least last summer. UnitedHealth is the largest seller of those private health plans for seniors, which have driven much of the health insurance industry\u2019s growth in recent years.<\/p>\n
The health care conglomerate has also been under investigation by the department over potential civil antitrust issues, while the US Federal Trade Commission has filed a lawsuit accusing the company and two rival pharmacy benefits managers of driving up insulin prices. The companies have disputed the FTC\u2019s allegations and Optum Rx called the suit \u201cbaseless.\u201d<\/p>\n
The Justice Department also has a civil fraud investigation into the company\u2019s Medicare billing practices that\u2019s separate from the criminal inquiry and was first reported in February.<\/p>\n
\u201cThe company has a long record of responsible conduct and effective compliance,\u201d UnitedHealth said in the July filing. The company also said it\u2019s been vindicated by audits by the Centers for Medicare and Medicaid Services, and has pointed to a favorable development in a long-running civil Medicare fraud case.<\/p>\n
Story Continues <\/p>\n
A court-appointed special master in that litigation said in March the Justice Department didn\u2019t have evidence to support claims the company overbilled Medicare by $2 billion.<\/p>\n
Top Three<\/p>\n
Optum Rx is one of the top three pharmacy benefit managers in the US and also dispenses drugs through mail-order and specialty pharmacies. It serves patients on UnitedHealthcare insurance plans as well as external customers. The segment had $133 billion in revenue last year.<\/p>\n
The company\u2019s Optum Health care delivery division includes clinics, surgery centers and home care. The company has about 135,000 \u201caligned\u201d physicians and advanced practice clinicians, including thousands that are employed directly. Until recently, Optum Health had been the company\u2019s fastest growing source of profit.<\/p>\n
UnitedHealth shares have lost about 40% this year through Monday\u2019s close. In April, the company missed its earnings targets for the first time in more than a decade and slashed its forecast. Its chief executive officer, Andrew Witty, resigned abruptly in May, and the company brought back board chair and former CEO Stephen Hemsley to take over.<\/p>\n
Hemsley is trying to restore the confidence of investors, regulators, and the public. He\u2019s led a management shakeup, including naming new leadership at the Optum Rx pharmacy unit and the Optum Health division.<\/p>\n
As part of that effort, UnitedHealth announced a new committee of its board in August to increase oversight. The \u201cpublic responsibility committee\u201d will oversee regulatory and reputational risks, among other functions. The committee\u2019s charter, posted on UnitedHealth\u2019s website, highlights the company\u2019s pharmacy benefits management practices among the key reputational risks the company faces.<\/p>\n
The company\u2019s shares got a boost this month when Warren Buffett\u2019s Berkshire Hathaway Inc. disclosed that it had purchased 5 million shares in the second quarter.<\/p>\n
(Updates with closing share price in fifth paragraph, context about Berkshire stake in final paragraph.)<\/p>\n
Most Read from Bloomberg Businessweek<\/p>\n
\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"(Bloomberg) — The US Justice Department\u2019s criminal division is digging into UnitedHealth Group Inc.\u2019s prescription management services as…\n","protected":false},"author":2,"featured_media":94833,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[43],"tags":[4056,102,2960,13299,5059,46966,46967,56,54,46965,55],"class_list":{"0":"post-94832","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-healthcare","8":"tag-bloomberg","9":"tag-health","10":"tag-healthcare","11":"tag-justice-department","12":"tag-medicare","13":"tag-medicare-fraud","14":"tag-prescription-management","15":"tag-uk","16":"tag-united-kingdom","17":"tag-unitedhealthcare","18":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/94832","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=94832"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/94832\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/94833"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=94832"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=94832"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=94832"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}