UnitedHealth Group Inc (NYSE:UNH, ETR:UNH) shares slumped following reports that the US Department of Justice has initiated a civil fraud investigation into the company’s Medicare billing practices.
The probe is focused on how the company documents diagnoses that can lead to increased payments for its Medicare Advantage plans, particularly within physician groups owned by UnitedHealth, according to a Wall Street Journal (WSJ) report citing sources with knowledge of the matter.
This follows a series of WSJ articles that reported on UnitedHealth potentially pocketing billions of dollars through dubious billing practices.
UnitedHealth said the report contained “misinformation” about the Medicare Advantage (MA) program. "The government regularly reviews all MA plans to ensure compliance and we consistently perform at the industry’s highest levels on those reviews,” it said in a statement.
The group added that it was unaware of new activities being launched by the regulator.
"The Wall Street Journal continues to report misinformation on the Medicare Advantage program," UnitedHealth said in a statement. "The government regularly reviews all MA plans to ensure compliance and we consistently perform at the industry’s highest levels on those reviews.'
UnitedHealth shares fell 8.3% to $460 on Friday morning.