An already tumultuous year for UnitedHealth Group just got even rockier.
Shares sank 17.79% today after CEO Andrew Witty announced he is immediately stepping down from his role for personal reasons, shocking investors. Chairman Stephen Hemsley will be taking over as chief executive.
That wasn’t the only bad news: The insurance giant also suspended its 2025 forecast due to higher medical costs that are handicapping the company.
Other insurers fell into the red today, including CVS Health, Humana, Cigna, and Elevance Health.
Not united or healthy
Witty, who took the role of CEO in 2021, has led the insurance giant through a remarkably shaky period over the last few months.
UnitedHealth Group shares crashed over 20% in a single day after it revealed disappointing earnings and cut its fiscal forecast in April, both due to higher-than-expected Medicare costs. It was the company’s first earnings miss since 2008, and roughly $190 billion in market cap has been wiped out in the weeks afterward.
Before enduring the stock’s worst day of trading in 26 years, UnitedHealth Group was already facing fierce backlash after UnitedHealthcare CEO Brian Thompson was killed last December. Thompson’s death has shed a harsh spotlight on UnitedHealth Group’s business practices.
Patients weren’t the only people pissed off: A group of shareholders just filed a class action suit against UnitedHealth Group, accusing it of not adjusting its 2025 net earnings forecast to account for how Thompson’s death would impact the company.
Thompson’s death has also cost the company in other ways: UnitedHealth Group spent $1.6 million in security fees for executives last year after the slaying.
Turning the clock back even further, one of UnitedHealth Group’s subsidiaries, Change Healthcare, was hit with a major cyberattack in February 2024. This January, UnitedHealth disclosed the damage was far worse than originally thought: The private data of over half of the US population was stolen, and the attack cost UnitedHealth Group $3.1 billion.
And if all that wasn’t enough, President Trump’s pharmaceutical industry executive order yesterday will likely be another headwind for the company's recovery—not to mention the potential pharma tariffs that have yet to be rolled out.
The only silver lining to all this is that Hemsley is a veteran of UnitedHealth Group who ran the company from 2006 to 2017. Looks like he’ll need every minute of that experience to help the largest health insurer in the country recover.—LB
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