The US Department of Justice has initiated an antitrust investigation into
This investigation adds another layer of scrutiny to the largest US health insurer, operating in pharmacy benefits, medical care, technology, and other services. Concerns have arisen regarding UnitedHealth’s acquisitions of health-care providers and data companies, as stated by an anonymous source. Both the company and the Justice Department declined to comment. The news of the probe caused UnitedHealth shares to drop by up to 5% upon the market opening on Wednesday, the most significant intraday decrease in a month.
UnitedHealth has faced criticism over the years for its expansion across the health-care system. Renowned for its UnitedHealthcare insurance unit covering over 47 million Americans, the company generates an increasing share of revenue and profits from health-services businesses under its Optum arm.
Optum’s clinics, home-care services, drug plans, and pharmacies often serve UnitedHealthcare members, allowing the company to convert expenses in its insurance business into revenue for Optum. While this strategy has fueled UnitedHealth’s growth, it has also drawn regulatory scrutiny, including antitrust concerns.
Regulatory Scrutiny
The Justice Department is reviewing UnitedHealth’s planned $3.3 billion acquisition of home-health provider Amedisys Inc. following the purchase of rival LHC Group last year. The department previously attempted to block UnitedHealth’s acquisition of Change Healthcare, the largest electronic data clearinghouse connecting healthcare providers with insurance companies for reimbursement.
UnitedHealth executives insist on maintaining a strict separation between its insurance business and Optum services, emphasizing that Optum serves many other insurance companies that compete with UnitedHealthcare.
Reports surfaced from a local news outlet in New York, the Examiner News, on Monday regarding UnitedHealth’s antitrust probe, which was later confirmed by The Wall Street Journal on Tuesday.
UnitedHealth is under investigation by more than a dozen US authorities, including the Department of Justice, as disclosed in the company’s regulatory filings.
(Updates included with opening share movement in the third paragraph)
To contact the reporters on this story:
Chris Strohm in Washington at cstrohm1@bloomberg.net;
Leah Nylen in Washington at lnylen2@bloomberg.net
To contact the editors responsible for this story:
John Lauerman
© 2024 Bloomberg L.P. All rights reserved. Used with permission.