By Haddon Libby
The largest medical provider in the United States is United Healthcare. The Department of Justice (DOJ) is conducting civil and criminal investigations into whether the company inflated patient diagnoses to secure billions in higher payments from the Centers for Medicare & Medicaid Services (CMS). Last week, The Wall Street Journal alleged that United Healthcare trained doctors to document higher-revenue diagnoses for conditions not actively treated. A 2023 analysis estimated that the company netted $8.7 billion in 2021 alone for untreated diagnoses. Known as upcoding, this practice exploits the Medicare Advantage’s payment model which compensates insurers more for sicker patients thus incentivizing providers like United Healthcare to exaggerate claims.
A 2023 Senate report highlighted $140 billion in industry-wide overpayments, with United Healthcare’s dominance making it a prime target.
The company also faces scrutiny for anticompetitive practices, particularly through its vertical integration with Optum, which employs or affiliates with 90,000 physicians. A 2024 antitrust investigation examined whether UnitedHealthcare favored Optum’s providers in contracting, potentially sidelining rival providers and limiting patient access to care. Critics argue this consolidation allowed United Healthcare to bypass regulations like the Affordable Care Act’s Medical Loss Ratio, which mandates that 80–85% of premiums be spent on care.
The DOJ is suing United Healthcare as it attempts to block its $3.3 billion acquisition of Amedisys, a home health provider. The issue here is that the acquisition would reduce competition, with allegations that the deal would harm patients and nurses in over 100 markets, including areas like the Coachella Valley.
United Healthcare’s 42% Medicare Advantage market share and extensive provider network amplify its ability to influence healthcare delivery, often at the expense of smaller competitors and patient choice.
Public and media criticism frequently highlights the company’s high rates of care denials, particularly through its prior authorization processes. Critics argue that the company’s use of algorithms and stringent authorization protocols prioritize cost-cutting over medical necessity, delaying or denying care. The discontent over such practices led to the murder of United Healthcare’s Brian Thompson.
The murder of Brian Thompson in December 2024 crystallized public anger toward United Healthcare. Social media platforms erupted with sentiments blaming the company for prioritizing shareholder value—evidenced by $14.2 billion in 2024 profits—over patient outcomes. Critics point to the company’s role in exacerbating healthcare disparities, particularly in underserved areas like the Coachella Valley, where access to care is critical. The company’s response to investigations, often dismissing allegations as “outrageous and false,” has been criticized as tone-deaf, further eroding trust.
A 2025 cyberattack on UnitedHealth’s Change Healthcare subsidiary, compromising 190 million people’s data, added to perceptions of negligence, with inadequate safeguards that harmed patients and providers.
In the Coachella Valley, United Healthcare’s presence through Medicare, Medicaid, and small business plans is significant. Residents using Covered California or Medi-Cal plans face the same risks of care denials and billing issues as the rest of the nation. The DOJ’s investigations signal potential systemic issues that could impact United Healthcare members, particularly if fraudulent billing inflates costs or limits provider access.
The company states that its Medicare Advantage plans comply with CMS standards, citing high performance in government reviews. It denies awareness of DOJ probes and argues that its provider network and tools enhance care access. The company also emphasizes its role in the Coachella Valley through Chamber of Commerce membership and partnerships, claiming to prioritize affordable, quality care.
The arguments against United Healthcare center on allegations of Medicare fraud, anticompetitive consolidation, excessive care denials, and ethical lapses that fuel public distrust. DOJ investigations into billing and antitrust issues, combined with high-profile incidents like Thompson’s murder, highlight a company accused of exploiting healthcare for profit. While the company defends its operations, the weight of regulatory and public criticism suggests a need for greater accountability to restore trust.
On May 13th, Andrew Witty stepped down from the CEO seat and was replaced with the company’s 72-year-old Chairman (and CEO from 2006-2017), Stephen Hemsley.
Haddon Libby is the Founder and Chief Investment Officer of Winslow Drake Investment Management, a Fiduciary RIA investment management firm. For more information on our services, please visit www.WinslowDrake.com.
