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After only three days of gains, shares of UnitedHealth Group (NYSE:UNH) fell in the premarket on Wednesday after The Guardian reported that the managed care giant secretly paid nursing homes that helped it win Medicare enrollees and cut hospital transfers for sick patients.
Citing an investigation, the publication said that the Eden Prairie, Minnesota-based health insurer paid thousands of dollars in bonuses to the facilities as part of a cost-cutting drive that saved it millions of dollars, but in some cases, put residents’ health at risk.
According to the Guardian, the payments were linked to a company program under which its own medical teams were operating from nursing homes, helping the facilities to cut expenses attributed to its enrollees.
The report was based on thousands of secret corporate and patient records and two whistleblower declarations presented to Congress this month. More than 20 current and former UnitedHealth (NYSE:UNH) and nursing home employees also gave details of the alleged practices.
The company denied the allegations, noting that any suggestion implying that its staffers were involved in preventing hospital transfers “is verifiably false.” Its payments to nursing homes help avoid unnecessary hospitalizations, and its partnerships help the facilities to improve health outcomes, UnitedHealth (NYSE:UNH) added.
Last week, UNH shares ended an eight-day losing streak amid insider purchases following the abrupt resignation of its former CEO, Andrew Witty, and a WSJ report about a DoJ criminal probe against the company.
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