7 hours Ago By Debadrita Sur
UnitedHealth Group announced that CEO Andrew Witty was stepping down immediately, effective Tuesday, due to "personal reasons" as stock prices began to plummet. This comes amid the company being possibly probed by the Justice Department for alleged medicare fraud , six months after the former CEO of the insurance unit, Brian Thompson, was assassinated in New York City. Article continues below ADVERTISEMENT Due to surging medical costs, the company also suspended its annual forecast, which forced shares to tumble by nearly 1% to a four-year low.
Israel targets Hamas leader Mohammed Sinwar in devastating strike on hospital Dad made friend dig own grave and kill himself after raping 6-year-old daughter Witty will be replaced by Stephen Hemsley, the company's board chairman and former CEO from 2006 to 2017. Witty, who was at the helm for four years, will be a senior adviser to Hemsley. In his statement, Hemsley praised Witty, saying that they "greatly valued his leadership and compassion as chief executive and as a director and wish him and his family the best.
" "We are grateful for Andrew’s stewardship of UnitedHealth Group, especially during some of the most challenging times any company has ever faced," Hemsley added. During a call with investors, Hemsley said, "Many of the issues standing in the way of achieving our goals as well as our opportunities are largely within our control." During last month's call, Witty said that the "overall performance was frankly unusual and unacceptable," which plummeted shares by more than 20%, marking the biggest single-day drop in almost 30 years.
After Thompson's fatal shooting, Witty defended the company's health insurance policy while also acknowledging in a New York Times essay that the system "is not perfect." The Wall Street Journal reported that the Justice Department is investigating a possible criminal Medicare fraud by the company without shedding light on the potential criminal allegations. However, sources told them that the federal probe is focused on UnitedHealth's Medicare Advantage business practices.
This is yet another blow to the company's growing list of government inquiries, namely potential antitrust violations as well as a civil probe of Medicare billing practices, among others, amid U.S. President Donald Trump 's administration to crack down on federal health spending, a primary source of the company's success story.
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