Health Plan Weekly

Although the outcome of a Dept. of Justice investigation into UnitedHealth Group is far from certain, it recently led UnitedHealth shareholders to file a lawsuit claiming that the company deceived investors before the DOJ investigation came to light. 

In February, news broke that the DOJ had been quietly looking into UnitedHealth’s buyup of physician practices — including how that vertical consolidation affects rival providers and health insurers — as well as Medicare Advantage billing issues. UnitedHealth’s shares tumbled on the news, which came to light after the New York-based Examiner News obtained an internal email showing the firm first became aware of the investigation in October 2023. 

Momentum to roll back health care consolidation is building in Washington, D.C. Lawmakers in both parties have attacked the trend in recent weeks, and prominent senators trained their sights on MultiPlan Corp., with one senator accusing the firm and its insurer clients of collusion, a violation of antitrust law. 

Given all the scrutiny on health care consolidation, one antitrust expert says Congress might be motivated to grant federal authorities the ability to review the kind of health care transactions that federal regulators are currently unable to block. 

Two committees of the House of Representatives held hearings on health care consolidation last week, and both featured continuous attacks by members of both parties on routine health care dealmaking. 

Plan sponsor groups say that health insurers have blocked or ignored employers’ requests to obtain information relating to both parties’ role as plan fiduciaries under the Employee Retirement Income Security Act of 1974 (ERISA). That’s despite the fact that insurers are required under a recent law to provide that information to employers on request — and that plan sponsors and plan members have begun to sue insurers to gain access to it. 

Plan sponsors have growing legal risk in their role as ERISA fiduciaries due to ongoing litigation and provisions included in the Consolidated Appropriations Act, 2021 (CAA). The lawsuits, many of which spring from requirements in the CAA, all relate to requirements that say health plans must prove they obtained the lowest prices possible for health care services and prescription drugs.  

During the Bernstein Strategic Decisions Conference, CVS Health Corp. executives directly addressed the company’s rumored desire to find a private equity partner to fund the growth of its Oak Street Health clinics. Meanwhile, managed care stocks took a hit after UnitedHealth Group CEO Andrew Witty called out reimbursement headwinds associated with Medicaid eligibility redeterminations. 

“There’s been a lot of inquiries, you know, based on some recent press reports on Oak Street,” CVS Chief Financial Officer Tom Cowhey said during a May 29 “fireside chat” with Bernstein analyst Lance Wilkes and CVS CEO Karen Lynch. Bloomberg reported on May 23 that the company has reached out to a handful of private equity firms in a bid to generate more capital to support new, senior-focused primary care clinics under the Oak Street brand.