How UnitedHealthcare became the face of a broken health care system

On Monday, police in Altoona, Pennsylvania, arrested Luigi Mangione in connection with last week’s shooting death of UnitedHealthcare CEO Brian Thompson. When Mangione’s identity became public, the online reaction around Thompson’s death went into overdrive; unlike most shootings, this one has brought a stream of support for the suspected killer rather than for the victim, and Mangione’s capture has only intensified that sentiment.

Mangione, 26, has since been charged with second-degree murder in New York, among other crimes, and has been valorized as a folk hero in many corners of the internet, though the killing of Thompson, 50, has also been widely condemned. After Mangine was arrested and identified, his following on X went from a few dozen followers to more than 300,000 overnight. From a flood of supportive memes on Instagram and X to a shooter lookalike contest this weekend in Manhattan’s Washington Square Park, making jokes about Thompson’s death somehow came to be considered acceptable and appropriate.

The widespread interest in Mangione demonstrates just how much built-up hate there is toward insurance companies: Americans are infuriated about the costs and complications of health care coverage, and Thompson’s murder has brought that anger to the surface. To try to better grasp the reaction among Americans, Today, Explained reached out to journalist Bob Herman, who covers the business of health care at Stat News and has co-reported several investigations about UnitedHealthcare.

Today, Explained co-host Sean Rameswaram spoke with Herman about UnitedHealthcare’s business practices, their place in the health care market, and why they have been a target of so much anger. An excerpt of his conversation with Herman, edited for length and clarity, is below. In the full podcast we also get into who Mangione is and what we know about his motives, why it took police five days to find him, and how they eventually did, so listen to Today, Explained on Apple Podcasts, Spotify, or wherever you get podcasts.

UnitedHealthcare is the largest health insurance company in America, and it is part of a bigger company called UnitedHealth Group. UnitedHealthcare covers older adults on Medicare Advantage, they cover the poor who are on Medicaid, they sell Obamacare plans, and they’re also the plans that employers offer to their workers. We’ve had a whole series this year called Health Care’s Colossus that has looked at this massive company and how it has its tentacles everywhere. A lot of people recognize it for UnitedHealthcare, the insurance company. It is not just a health insurance company — that’s what it’s most known for, that’s why it’s often reviled — but people don’t recognize all the other components that it owns. It owns a ton of medical practices. It either employs or is affiliated with one out of every 10 doctors in the country. It is the largest claims processor. They are everywhere.

What was your reaction when you saw that Brian Thompson had been shot last week?

I’ve never covered a homicide on my beat. Normally, this is a beat filled with white-collar crime, so this definitely has been outside of the norm. My colleague and I were watching UnitedHealth Group’s Investor Day on Wednesday morning, just kind of a routine thing. It’s a big meeting every year — all kinds of investors and shareholders get together and they talk about their earnings for the year — and it’s a big cheerleading routine. Normally Brian Thompson appears pretty early on, as the head of the insurance division for United. And then about an hour in, that’s when I first got a text of a New York Post story saying that Thompson had been shot and killed. So a little bit more than an hour into it, that’s when Andrew Witty, the CEO of UnitedHealth Group, the parent company, came back out and canceled the rest of the conference. We had never seen anything like it.

Almost immediately, people were celebrating this homicide. What was your reaction to that?

The reactions were pretty morbid. Pretty grim. The dancing on the death of somebody was pretty vile. But anyone who covers health care knows that people are fed up with the system. This is not new. This has been going on for decades. Even when the Affordable Care Act, or Obamacare, came into play 15 years ago, people still hated the system and it’s persisted since then. So people’s frustrations have been bubbling under the surface for so long. To say you were surprised by all the reactions, then I think maybe you had your head buried in the sand a little bit.

Before we talk about what this company does that might upset people, can you just tell us about the company generally?

UnitedHealthcare is the largest health insurance company in America. They cover more people than anyone — [its coverage] includes Medicare Advantage, Medicaid, Obamacare, and all the different types of employer plans out there. And there’s a lot.

Which I imagine makes them pretty powerful in this market.

Yeah. Now, a lot of health care dynamics are local. The fights that often occur between health insurers and providers, like hospitals and doctors, are all about who has market share in a specific area. United might not always have the biggest market share in a given area, but nationally they are very powerful, they are very profitable. There’s no way of getting around them in pretty much any market. They exist almost everywhere in some capacity.

And what do they do with that power? How do they throw it around?

If you have a UnitedHealthcare plan, you want them to negotiate better rates for you. That’s their primary function. And so they use some of that to try and drive better deals with hospitals and doctors and other types of facilities. They’re also an insurance company and they happen to deny or delay claims as well. As an insurance company, the easiest way to make money is to make sure you’re paying out fewer dollars. Now, there are laws in place, especially a federal law that says you have to spend a certain amount of your premium dollars on care for people. You just have to do it. But insurers have an incentive to stay as close to those thresholds as possible. They don’t want to have to pay out more than they absolutely have to.

You just, of course, used two of the operative words in this story because as we found out, the shooter had inscribed three words on his bullets: deny, delay, and depose. Is this company known for its denials?

Every health insurance company out there is known for their denials, to some degree. Specific rates of denials are tough to come by, but insurers — especially the for-profit ones that [trade] on the stock market — have an incentive to deny care. There have been so many issues with denials over the years. My colleague Casey Ross and I reported on a big one within Medicare Advantage, the program for older adults. UnitedHealthcare is the biggest [provider] in Medicare Advantage, and over the past several years, they’ve been using algorithmic prediction, predictive tools, and artificial intelligence to basically ramp up denials specifically in post-acute care, the care that somebody gets when they leave the hospital. So especially on that side of the coin, post-acute care denials have been a very big issue for United.

What exactly does that mean, that they’re using algorithms and AI to deny Medicare Advantage [claims]? How do they do that?

So let’s say someone goes to the hospital and then the hospital says, okay, you know, you’re ready for physical therapy, occupational therapy, speech therapy. Let’s send you to a rehab facility or a nursing home. So a person will go there and they’ll start their physical therapy, and behind the scenes, UnitedHealthcare has used a tool called NaviHealth. There’s an algorithm within the company that looks at the patient’s demographics — how sick they are, their history — and tries to come up with some kind of prediction of how much time they’ll need in that nursing home. Let’s say it’s 16 days. That’s what the algorithm says — after 16 days, you should be good. Now, if it’s used as a guide, that’s fine. But in many cases, we found documents that said that United told their case managers, “You have to stick to the algorithm.”

And that’s where it becomes a problem, because if you’re saying this algorithm spits out 16 days for somebody and they’re not ready to go home on the 16th day, if they can’t even go to the bathroom themselves, if they still can’t walk around but the algorithm says it’s time to ship them out, that’s where it’s a problem. And that’s what’s happened. Then families are left with the decision of, do I pay out of pocket to stay at this nursing home to get the care that my mom or dad or grandparent needs? Or do I take them home with me and then risk having them fall or get hurt again and have to go back to the hospital or worse? So that’s how the algorithms play in those types of situations.

And people know this is happening and they’re mad about it?

On the Medicare Advantage side, most people actually don’t. They’re not aware as much about this because the algorithm happens behind the scenes. It’s not like families are getting a sheet of paper saying, “Hey, our algorithm says you have this much time here.” They really don’t find out about this until the nursing home says, “Hey, your insurance is up and we have to kick you out now.”

The denials are very front and center in other insurance plans where they say, “I know I need this back surgery or I need this prescription,” and then United will come along with maybe a prior authorization which says, “Hey, doctor, fill out more paperwork to make sure that this person needs this procedure or needs this drug.” And then maybe they’ll come back with a denial that says, “We’re not going to cover this procedure or this prescription drug.” That’s where it’s most front and center for people, that’s where a lot of the outrage comes from: those widespread delays and denials.

We’re talking about our eldest citizens who are often on the receiving end of these algorithms or AI initiatives that tell them they’ve run out of care.

At least in our reporting it is — for the Medicare Advantage — it is the oldest, it’s the frail, often the poor, the oldest people in this country who often have no idea that this is going on. Once they find out, they can appeal; anyone can appeal any denial. But it is such an arduous process. If you’re sick or injured, that’s not something you want to be doing, and you might not have family to help you out either. So it is very clearly a problem.

Is this a UnitedHealthcare-specific problem or is this a systemic problem? It feels like a systemic problem.

This is systemic. This is not isolated to just UnitedHealthcare. UnitedHealthcare gets the most criticism and heat for this because they are the largest and they’re a very common provider for any workplace plan. But there are other large insurers: Cigna, Aetna, all the Blue Cross Blue Shield plans, Humana. This is just how US health insurance works. This is a systemic issue, especially for the insurance companies that are on the stock market. They have a duty to make money for shareholders. And one of the ways that they do that is by making sure that they pay out fewer claims. The most-watched number on every earnings call for an insurer is what’s called the “medical loss ratio.” That’s a number that says how much money from our premiums we spend on medical care, and lower is better. If it’s higher than expected, Wall Street freaks out. I think that kind of tells you a lot.

This has been an insane week for this industry. But do you think anything changes now, other than executives are going to have more security?

Could this be a galvanizing event to broader health care reform? It’s certainly possible, because the American public has made their voices very clear here. But this is completely dependent on a new administration, a new Congress. This is a federal policy issue. And if Congress doesn’t act, then you’re just going to continue to see more of this — unless companies start to make changes on their own. But if they do, it’ll be around the edges. It’ll be tinkering.