US Justice Department launches criminal probe into UnitedHealth’s Medicare practices

US DOJ Opens Criminal Investigation into UnitedHealth Over Medicare Fraud Allegations

Health insurance giant under federal scrutiny as turmoil deepens and shares plunge

The United States Department of Justice (DOJ) has launched a criminal investigation into UnitedHealth Group, one of the nation’s largest health insurers, over its Medicare Advantage business practices, according to a Wall Street Journal report published Wednesday.

The probe is being led by the DOJ’s healthcare fraud unit and adds to the mounting legal and political scrutiny facing the company. While the exact details remain unclear, sources close to the matter told the WSJ that the investigation has been ongoing since at least mid-2023.

UnitedHealth denies DOJ contact, defends program integrity

UnitedHealth responded by stating it had not received formal notification of a criminal investigation and reaffirmed its confidence in the integrity of its Medicare Advantage program. “We stand by the integrity of our program,” a company spokesperson said.

Last week, UnitedHealth acknowledged in regulatory filings that it is subject to “various governmental investigations, audits, and reviews,” though no further specifics were provided.

A DOJ spokesperson declined to comment on the report. Reuters also reported no immediate response from the department.

Medicare Advantage under fire

The case is part of a broader federal and congressional crackdown on alleged abuse in the Medicare Advantage system, a private-sector alternative to government-managed Medicare. Under the system, insurers receive fixed payments per patient, with additional compensation if enrollees have multiple health conditions—an incentive structure that critics say invites billing inflation.

Nearly 50% of the 65 million Americans enrolled in Medicare now use Medicare Advantage plans provided by private insurers such as UnitedHealth, which has long been a dominant player in the space.

Prior investigations and political pressure

The new criminal probe follows a civil investigation reported in February into UnitedHealth’s Medicare practices. Around the same time, Senator Chuck Grassley launched an inquiry into the company’s billing methods, requesting detailed compliance documentation.

Earlier this month, the DOJ also filed a lawsuit against three major health insurers—unrelated to UnitedHealth—accusing them of paying hundreds of millions of dollars in kickbacks to brokers to steer patients into Medicare Advantage plans, adding further pressure on the industry.

Executive shakeup and financial fallout

UnitedHealth has been grappling with internal instability amid growing external pressure. On Tuesday, CEO Andrew Witty unexpectedly stepped down, and the company withdrew its 2025 financial guidance due to rising medical costs. The double announcement sent UnitedHealth shares down 18%, marking a four-year low.

Stephen Hemsley, who served as CEO from 2006 to 2017, has returned to lead the company through its turbulent period, which has also been marred by the December murder of Brian Thompson, the CEO of its insurance division.

Following the WSJ report on Thursday, UnitedHealth shares tumbled another 18%, hitting a five-year low. The company has now lost nearly $300 billion in market capitalization since its November peak.

Investor confidence shaken

“The stock is already in the doghouse with investors, and additional uncertainty will only pile on,” said James Harlow, Senior Vice President at Novare Capital Management, a UnitedHealth shareholder.

If the losses persist, UnitedHealth could end up as the worst-performing stock in the S&P 500 for two of the last three trading days—an astonishing reversal for a company once considered a blue-chip healthcare leader.

As the DOJ's criminal investigation intensifies, UnitedHealth finds itself at the epicenter of a growing storm over the future of Medicare Advantage and corporate accountability in the American healthcare system.

Stay tuned to The Horizons Times for the latest updates on U.S. healthcare investigations, regulatory shifts, and major industry developments.