Shares of UnitedHealth Group fell in early trading Wednesday on a news report alleging the Eden Prairie-based health care giant secretly paid bonuses to nursing homes to slash transfers to hospitals, thereby saving money for the company’s UnitedHealthcare insurance business.
Shares closed down nearly 6% Wednesday.
In an investigative report, the Guardian reported UnitedHealthcare paid out secret bonuses as part of a program that stations the company’s medical teams in nursing homes and pushes them to cut care expenses for residents with United health insurance. The report cited several instances of nursing home residents who needed immediate hospital care but failed to receive it following interventions by UnitedHealth staff.
The news outlet said its investigative report was based on thousands of confidential corporate and patient records as well as court files, interviews with more than 20 current and former UnitedHealth and nursing home employees and two whistleblower declarations submitted to Congress this month through the nonprofit legal group Whistleblower Aid.
It incorporates allegations, as well, from two whistleblower lawsuits against the company that the Justice Department opted not to join — a point seized on by the company in response to the story.
“The U.S. Department of Justice investigated these allegations, interviewed witnesses, and obtained thousands of documents that demonstrated the significant factual inaccuracies in the allegations,” UnitedHealth Group said in a statement. “After reviewing all the evidence during its multi-year investigation, the Department of Justice declined to pursue the matter.”
It’s the latest in a series of setbacks for Minnesota’s largest company by revenue, which has seen its stock value cut in half in recent months amid missteps in the Medicare Advantage business as well as an abrupt CEO change.
The events — including a massive cyberattack more than a year ago, the killing of a company executive, federal investigations and copious litigation — have created a sense of siege at UnitedHealth, which employs about 400,000 people including 19,000 in Minnesota.
