The U.S. Department of Justice (DOJ) has opened a criminal investigation into UnitedHealth Group over possible Medicare fraud, according to a report by The Wall Street Journal. The probe is being led by the DOJ’s healthcare-fraud unit and has reportedly been underway since at least mid-2024.
UnitedHealth stock falls after report
News of the investigation shook investors. UnitedHealth Group’s stock (NYSE: UNH) dropped 8% in after-hours trading on Wednesday. That decline added to a broader sell-off sparked earlier in the week when the company suspended its 2025 financial forecast.
On Tuesday, CEO Andrew Witty resigned unexpectedly. The company cited rising medical costs as a reason for halting its financial guidance. The announcement led to a nearly 18% plunge in UnitedHealth’s stock, marking a four-year low.
Allegations remain unclear
The DOJ has not publicly disclosed specific details about the criminal probe. However, The Wall Street Journal reported that the investigation centers on potential fraud involving the Medicare Advantage program.
In February, The Journal also revealed that UnitedHealth was under a separate civil investigation into its Medicare billing practices. At the time, the company said it was unaware of any new investigations.
Political and legal pressure grows
Also in February, U.S. Senator Chuck Grassley launched a congressional inquiry into UnitedHealth’s Medicare billing. He requested detailed records about the company’s compliance systems and how it manages its Medicare Advantage operations.
A DOJ spokesperson declined to comment on the new criminal case, and both UnitedHealth and the DOJ did not respond to requests for comment from Reuters.
Focus on Medicare Advantage
The criminal probe comes amid growing scrutiny of the Medicare Advantage program across the healthcare industry. Earlier this month, the DOJ filed lawsuits against three major U.S. health insurers. The lawsuits allege that those companies paid large kickbacks to insurance brokers to steer patients into their Medicare Advantage plans.
Medicare Advantage is a private alternative to standard Medicare, which is run by the government. Nearly half of the 65 million people enrolled in Medicare have chosen Advantage plans, which are managed by private insurers like UnitedHealth.
Under the program, the government pays a fixed amount for each patient. However, payments increase when patients have multiple or more severe health conditions, creating potential incentives for overbilling or misreporting diagnoses.
Summary
UnitedHealth Group is now the latest company to face mounting legal pressure over its role in Medicare Advantage. The criminal investigation by the DOJ adds to a wave of federal scrutiny, civil probes, and political attention focused on how insurers operate within the government-backed healthcare program. As the DOJ continues to crack down on alleged abuses, the impact on the healthcare industry—and on seniors who depend on these plans—could be significant.
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