UnitedHealth Group announced on Tuesday that CEO Andrew Witty unexpectedly stepped down and suspended its financial forecasts for 2025 due to rising healthcare costs. Following this news, UnitedHealth shares fell more than 10% in pre-market trading.
The company’s former CEO and 28-year veteran, Stephen Hemsley, will return to lead the healthcare giant UnitedHealth. UnitedHealth stated that Witty’s departure was for personal reasons, but provided no further details.
During Witty’s tenure, the company faced significant challenges. The tragic death of UnitedHealth’s top insurance executive, Brian Thompson, in December, and a major cyberattack that disrupted healthcare across the US in early 2024 were among the highlights of this period. Following this attack, which affected approximately 200 million people, the company reported lower-than-expected earnings in April for the first time since the 2008 financial crisis. This decline was caused by higher-than-expected medical expenses and problems within the Optum unit, which negatively impacted the company’s expected repayments for 2025.
Bahl and Gaynor COO Kevin Gade stated, “Witty’s sudden departure was a surprise, but it reflects the unique challenges UnitedHealth faces compared to its competitors. At some point, leadership responsibility needed to be taken.”
He commented.Since mid-2023, the U.S. health insurance industry has been under pressure due to increased demand for care for the elderly and disabled under government-backed Medicare plans.
