UnitedHealth reportedly secretly paid nursing – Business News
UnitedHealth shares fell more than 4% on Wednesday after the UK’s Guardian newspaper reported that the company made secret funds to nursing properties to scale back hospital transfers, including to the woes of the healthcare conglomerate.
The alleged motion, half of a sequence of cost-cutting ways, has saved the company thousands and thousands, however at occasions risked residents’ health, the Guardian reported, citing an investigation.
The allegations add to the litany of negatives which have harm UnitedHealth within the final a number of months, following a huge cyberattack at its Change Healthcare unit, studies of felony and civil investigations into the company’s practices, together with one for Medicare fraud and the abrupt departure of CEO Andrew Witty final week.
UnitedHealth reportedly made secret funds to nursing properties to scale back hospital transfers, including to the healthcare conglomerate’s woes. AP
Shares have stumbled all 12 months, shedding more than 39%, in contrast with a 0.6% lower for the Dow.
UnitedHealth mentioned in response that “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.”
The company additionally mentioned in an emailed assertion that the DOJ declined to pursue the matter after reviewing all of the proof during its multiyear investigation.
Reuters has not independently verified the article’s allegations.
“The news is only seemingly getting worse for UnitedHealth,” mentioned Sahak Manuelian, managing director, international equity trading at Wedbush.
“This is kind of a tough situation for investors to come in and have any kind of confidence in putting money to work, so we’ll have to kind of wait and see how this plays itself out, unfortunately,” Manuelian mentioned.
Stephen Hemsley returned as UnitedHealth CEO final week. AP
Separately, HSBC downgraded the stock to “reduce” from “hold,” and cut the price goal to a street-low of $270.
The brokerage mentioned greater medical prices, stress on drug pricing and its pharmacy benefit management unit, OptumRx, and a potential Medicaid funding cut can upset the company’s restoration journey.
The company is now relying on the expertise of Stephen Hemsley, who returned as CEO to steer it by the present disaster.
“We believe Hemsley has the experience and leadership attributes that the company needs to restore credibility and right the ship,” mentioned James Harlow, senior vice president at Novare Capital Management.
