In first speech back, UnitedHealth’s new CEO pledges to review hot-button issues

Newly back in the CEO chair at UnitedHealth Group, Stephen Hemsley on Monday vowed to address a series of lightning-rod issues that have heightened public scrutiny of the company.

That includes fresh reviews of the Eden Prairie company’s pharmacy business, the way it scores Medicare patients’ health risks and its care management practices.

But Hemsley, the longtime executive who resumed his role as CEO last month, kept his cards close to the vest during the company’s annual meeting Monday, offering almost no specifics about the new reviews.

He also apologized for recent financial missteps that have shocked investors and prompted an unprecedented decline in UnitedHealth Group’s share price.

“Importantly, I’m returning to the company with a fresh perspective on some of the most publicly discussed matters,” Hemsley said.

“I’m introducing new initiatives to include a comprehensive review of all our policies, our practices, and the associated processes and performance measures for risk assessment coding, for managed care practices and for pharmacy services. We will use authoritative independent experts to evaluate and assess these reviews, and we’ll modify our approaches where appropriate.”

A former top physician executive with UnitedHealth told the Minnesota Star Tribune last month that addressing reputational hits likely would be a top priority for Hemsley, who is replacing previous CEO Andrew Witty.

Witty remains with the company as senior advisor after stepping down for personal reasons following uncharacteristic financial missteps. The company’s share price has plummeted in recent months.

UnitedHealth Group is parent company to UnitedHealthcare, the nation’s largest health insurer, and a large pharmacy benefit manager (PBM) called Optum Rx.

A federal watchdog report last year found UnitedHealth Group stood out from its peers in using questionable diagnosis data to boost payments in Medicare Advantage, a privatized version of the federal government health insurance program for seniors. And Optum Rx has been caught up in Federal Trade Commission scrutiny of the PBM industry.

Since the Dec. 4 killing of company executive Brian Thompson, UnitedHealth has been at the center of public discussion over health insurance denials, although Hemsley did not directly address that issue in his remarks Monday.

The company did not specify what he meant by “managed care practices.”

In a Q&A period during Monday’s event, one shareholder asked UnitedHealth to provide specific data on the factors used by the company’s artificial intelligence technology to override decisions from physicians and health care providers. That premise was immediately rejected by Dr. Wyatt Decker, a former Mayo Clinic executive who is the chief physician for value-based care at UnitedHealth Group.

“We do not use AI to deny care or tell our doctors or nurse practitioners how to practice,” Decker said. “We believe that there’s a terrific future for health care when providers are supported by smart systems that can put pressing needs and suggestions in front of them — frankly at their fingertips — and we are on the front edge of that technology with decision support for our physicians.”

A patient lawsuit is moving forward in the U.S. District Court of Minnesota where plaintiffs allege UnitedHealthcare has used a faulty artificial intelligence program to deny coverage for post-acute care needed by Medicare patients. UnitedHealth says the lawsuit is based on unfounded allegations and mischaracterizes the work of its clinicians.

Hemsley opened his annual meeting remarks by apologizing for the company’s recent financial performance and pledging to shareholders that UnitedHealth would “earn back your trust and your confidence.”

The company had a stellar reputation on Wall Street for growth and profitability during Hemsley’s first stint as CEO, from 2006 through 2017. At that point, he graduated to the position of board chairman, a job he still holds today.

Going forward, the most immediate area of focus is “pricing discipline,” Hemsley said.

“Clearly we have gotten things wrong,” he said. “We underestimated care activity and cost trends and generated outsized growth. We are intensively examining our approaches and have already begun to make improvements, including, most notably, a significant retooling of our efforts to ensure more precise and more accurate forecasting of both care and financial activity.”

Last month, UnitedHealth Group suspended financial guidance for the year due in part to unexpected costs in Medicare Advantage as well as the company’s Optum Health clinics that care for seniors. Hemsley said the company would issue new guidance with the release of second quarter results on July 29.

“Across the enterprise, our pricing decisions and benefit designs for the next year are being fully shaped with an abundance of respect for the trend factors we noted in May and the environment we find ourselves in today and see going forward,” Hemsley said.

In recent weeks, the company has been making changes in management teams and processes to ensure it has the right leadership in place going forward, Hemsley said. He added that UnitedHealth this week is submitting bids to the federal government for 2026 work that reflects “our elevated care activity experience” in Medicare Advantage.

“It has never been more evident to me that we need to reinvigorate the performance culture and disciplines that have long been the hallmark of this company to more effectively navigate through this dynamic period.”