From its CEO’s resignation to a reported federal investigation into its Medicare Advantage business practices, May was a challenging month for UnitedHealth Group.
Here are four things to know:
Andrew Witty resigns
UnitedHealth Group announced May 13 that CEO Andrew Witty was stepping down for personal reasons. Mr. Witty served as the company’s CEO since 2021. He will continue to serve as a senior adviser.
On May 20, Mr. Witty resigned from UnitedHealth Group’s board of directors, effective immediately. He will not stand for re-election as a director during the company’s annual shareholder meeting scheduled for June 2.
Mr. Witty was replaced as CEO by board chairman and former Chief Executive Stephen Hemsley. Mr. Hemsley, 72, joined UnitedHealth Group as COO in 1997. He was named CEO in 2006, a role he held until his retirement in 2017. He has chaired the UnitedHealth Group board since 2017. UnitedHealth Group is asking shareholders to support a $60 million stock option award for its new CEO.
UnitedHealth Group suspends earnings outlook
On the same date Mr. Witty announced his resignation, UnitedHealth suspended its 2025 earnings outlook as “care activity continued to accelerate while also broadening to more types of benefit offerings than seen in the first quarter,” especially in the Medicare Advantage business. The company expects to return to growth in 2026.
In its first-quarter earnings for 2025, the company was caught off guard by care utilization rates twice as high as expected among its Medicare Advantage membership, especially for outpatient and physician services. The rise in costs led UnitedHealth to cut its earnings guidance for 2025, sending its share price down 20% on April 17.
A reported criminal investigation
The Wall Street Journal reported May 14 that UnitedHealth Group is under criminal investigation by the Justice Department for alleged Medicare Advantage fraud.
Citing individuals familiar with the matter, the outlet said the Justice Department has been investigating the company since at least summer 2024 over its MA business practices, but exact allegations are unclear.
UnitedHealth told the Journal that it stands “by the integrity of our Medicare Advantage program.”
Alleged nursing home incentives
The Guardian reported May 21 that a UnitedHealth Group program allegedly incentivized nursing homes to avert medically necessary hospital transfers for their residents.
The program places UnitedHealth employees at about 2,200 nursing homes across the country. The Guardian reported these nursing homes were secretly paid thousands in bonuses to prevent transferring residents to hospitals — which was part of a strategy that saved the company millions while risking patient safety.
UnitedHealth Group refuted the claims.
“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 responding to the report. “After reviewing all the evidence during its multi-year investigation, the Department of Justice declined to pursue the matter.”
