Health Insurers' Chronic Problem: Profits, Fraud, and a Government Squeeze

UnitedHealth and others are caught between cost-cutting regulators and questionable billing practices

Health insurers are in a bind, but don’t mistake their pain for yours.

Companies like UnitedHealth, Humana, and Centene are getting squeezed hard. On one side, rising healthcare costs. On the other, a stingier federal government trying to rein in spending. Medicare Advantage, the crown jewel of health insurer profits, is now under the microscope.

And it’s about time.

The Wall Street Journal reports the feds are running a criminal investigation into UnitedHealth’s Medicare billing practices. Prosecutors are digging into how doctors and nurses were deployed to boost the number of costly diagnoses tied to higher government payouts.

You read that right: send in the nurse, write down a few extra conditions, and watch the reimbursements roll in. Former employees say the company built systems to capture every billable ailment—whether the patient needed care or not.

Medicare Advantage was sold to Americans as a more efficient, market-based solution for seniors. But somewhere along the way, “efficient” became “exploitable.”

UnitedHealth says it stands by the “integrity” of its program and welcomes oversight. But only after being outed by investigative reporting. Only after former staff started talking. Only after the DOJ showed up.

Meanwhile, insurers are losing their grip on costs. Government reimbursements are tightening. Hospital bills are climbing. And their profits are starting to feel the heat.

But here’s the catch: they’re still doing just fine.

UnitedHealth reported billions in earnings. Humana and Centene aren’t far behind. So when you hear them crying about government pressure and hacking threats (yes, they’re under cyberattack too), remember; the game isn’t over. They’re just not winning by as much.

And you? You’re the one paying premiums. The one whose claims get denied. The one who has to prove over and over that your diagnosis is real.

Maybe the chronic problem in health insurance isn’t medical.

Maybe it’s moral.

—Jack D. Hapsburg

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