UnitedHealth Under New Scrutiny for Billing Practices
A recent Wall Street Journal article titled “DOJ Investigates Medicare Billing Practices at UnitedHealth” by Christopher Weaver and Anna Wilde Matthews (Feb. 21. 2025) describes a new investigation into the insurer’s “practices for recording diagnoses that trigger extra payments to its Medicare Advantage plans, including at physician groups the insurance giant owns.” As noted in previous CMA Alerts and described in the article, the Journal published a series of articles last year which “showed that Medicare paid UnitedHealth billions of dollars for questionable diagnoses.” The article also discusses other, ongoing Department of Justice probes of the insurer.
In the wake of the new DOJ investigation against UnitedHealth, Senator Chuck Grassley (R-Iowa) sent a letter to UnitedHealth Group Chief Executive Officer Andrew Witty on February 24, 2025 “demanding detailed information on the company’s Medicare billing practices.” As outlined in a press release issued by the Senator’s office:
Grassley’s letter cited reports of apparent fraud, waste and abuse at UnitedHealth Group, including efforts to diagnose enrollees with obscure revenue-generating diagnoses that were irrelevant or inaccurate. According to reporting, this resulted in $8.7 billion in extra payments in 2021 alone.
“Despite these oversight efforts, [Medicare Advantage Organizations] continue to defraud the American taxpayer, costing them billions of dollars a year … The apparent fraud, waste, and abuse at issue is simply unacceptable and harms not only Medicare beneficiaries, but also the American taxpayer,” Grassley wrote [emphasis added].
Amid these investigations, however, the insurer appears to be lobbying to roll back oversight of their activities. STAT News recently issued the latest article in their “Health Care Colossus” series about UnitedHealth titled “Under siege after a tragedy, UnitedHealth grapples with fresh security threats and a customer backlash” by Tara Bannow, Bob Herman, Casey Ross and Lizzy Lawrence (Feb. 25, 2025). The article states that the insurer is “moving to align itself with the new Trump administration, urging officials to reverse changes under former President Biden that have made their private Medicare plans for older Americans less profitable, while promising to take up the president’s quest to ‘make America healthy again.’” Later in the article, the authors note that such efforts are “central to the company’s drive to double down on its practices and slash federal regulations to bring back more profitable insurance plans.”
Nominee for CMS Administrator Has Promoted Private Medicare Advantage Plans for His Own Personal Gain
Dr. Mehmet Oz has been nominated by President Trump to be the Administrator of the Centers for Medicare & Medicaid Services (CMS), the agency under the Department of Health & Human Services that oversees the Medicare program. As discussed in a recent New York Times article titled “Dr. Oz: How His Millions Collide With Medicare” by Reed Abelson and Susanne Craig (Feb. 24, 2025), Dr. Oz “has been a relentless promoter of controversial private insurance plans for older Americans.”
The article describes how Dr. Oz promoted MA plans during his TV career, but “did not tell the audience that he made money from touting the plans” through a “for-profit company operating [a] call center, TZ Insurance Solutions [which] paid to be featured.” The article also notes that “Dr. Oz even became a licensed broker for TZ Insurance in almost every state, according to regulatory filings newly unearthed by The New York Times, with the idea that he could sell plans directly to viewers.” Noting his wealth of tens to hundreds of millions of dollars, including by “hawking dietary supplements [… and being] paid by medical device firms and health-related ventures” the article states:
An examination by The Times of his myriad financial interests revealed not only opaque ties with the industries he may soon regulate but also a coziness with health care companies that lawmakers have already highlighted in questioning his independence.
The authors also note that his wealth includes “as much as $600,000 in stock in UnitedHealth Group.” If confirmed, The Times notes that:
he would wield immense power, overseeing health insurance coverage for nearly half of all Americans and a budget of about $1.5 trillion in annual spending. Given his advocacy of Medicare Advantage, Dr. Oz would have the authority to expand the privatization of the government program as he and many Republicans have urged.
As the Center for Medicare Advocacy has raised in a previous CMA Alert (Nov. 21, 2024), Dr. Oz has called for “Medicare Advantage for All,” meaning private insurance companies would run the entire program – and beyond. We assert that this is a dangerous direction for Medicare and would harm beneficiaries. We urge the Senate not to confirm him.
Conclusion
As the insurance industry, including the largest MA insurer, is pushing for more money and less oversight, the Trump Administration has nominated a Medicare director who, with a clear personal financial stake, has advocated for everyone to be in MA plans.
As we argued in a recent CMA Alert (Jan. 9, 2025), rather than roll back recent improvements, it is time to expand on important oversight and consumer protection measures surrounding MA plans. Over the last four years, progress has been made in trying to rein in wasteful MA overpayments, curb plans’ inappropriate use of prior authorization, and other measures – but much more still needs to be done.
Such efforts in recent years may have had a modicum of impact on a long-overdue and necessary course correction – slowing the rapid rise of Medicare Advantage at the expense of traditional Medicare. As highlighted in a STAT News article titled “Medicare Advantage enrollment growth slows drastically” by Bob Herman (Feb. 26, 2025), “[t]he number of people enrolled in a private Medicare Advantage plan grew just 3.1% from 2024 to 2025 — well below projections from the federal government and Wall Street, and one of the slowest years of growth ever in the program.” The article states:
Between 2016 and 2022, enrollment in Medicare Advantage increased 9%-10% annually, fueled by a marketing bonanza from health insurers that wanted a piece of the $500 billion program. That scorching growth resulted in more than half of all Medicare enrollees being in Medicare Advantage. But since 2022, annual enrollment growth has slowed, largely because a majority of Medicare beneficiaries have already migrated to the program. Medicare Advantage also faces criticism from lawmakers, regulators, and beneficiaries themselves over its bloated payment system and onerous denials of care.
Despite this recent slowdown in MA enrollment, policies favoring MA are already vast, and still growing. The Medicare program and beneficiaries cannot afford to tip the scales even further towards privatizing Medicare.
February 27, 2025 – D. Lipschutz