STAT+: UnitedHealth investor lawsuit moves forward on allegations it ‘manufactured earnings’ to hide declining profits

A federal judge on Wednesday declined UnitedHealth Group’s motion to dismiss an investor lawsuit, allowing the case to move forward. The suit alleges the company “juiced” its earnings by $3.3 billion in 2024 to conceal weakness in its Medicare Advantage business.

The ruling was mixed for the California Public Employees’ Retirement System, or CalPERS. U.S. District Judge Jeffrey Bryan dismissed most of the pension fund’s allegations that UnitedHealth leaders deceived investors about multiple aspects of their business in order to artificially inflate the company’s stock, agreeing with UnitedHealth that most of the cited statements were not specific enough or were typical promotional “puffery” that investors would not act on.

One of the lawsuit’s central allegations was that UnitedHealth concealed an illegal practice of making its Medicare Advantage patients appear sicker on paper to siphon more money from the government. CalPERS cited company statements that home visits kept members healthy and that its clinicians made independent clinical decisions. Reporting has since shown that UnitedHealth used those visits to add diagnoses to patients’ records for which they received no follow-up care and pressured its doctors to do the same using bonuses.