Universal Health Services, Inc. (NYSE:UHS) Investor Securities Class Action Lawsuit 12/23/2016
December 23, 2016 (Shareholders Foundation) - An investor in shares of Universal Health Services, Inc. (NYSE:UHS) filed a lawsuit in the U.S. District Court for the Central District of California over alleged violations of Federal Securities Laws by Universal Health Services in connection with certain allegedly false and misleading statements made between February 26, 2015 and December 7, 2016.
According to the complaint the plaintiff alleges on behalf of purchasers of Universal Health Services, Inc. (NYSE:UHS) common shares between February 26, 2015 and December 7, 2016, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between February 26, 2015 and December 7, 2016, the Defendants made false and/or misleading statements and/or failed to disclose that Universal Health admitted patients based on its own financial considerations and not upon the medical necessity of the patient, that Universal Health would keep patients admitted until their insurance payments ran out in order to ensure the maximum payment for its services, that as a result, Universal Health’s revenues from inpatient care relied on unsustainable practices, that in turn, Universal Health lacked effective internal control concerning its practices and policies of admitting patients, and that as a result, Universal Health’s public statements were materially false and misleading at all relevant times.
Universal Health Services, Inc. reported that its annual Total Revenue rose from over $8.2 billion in 2014 to over $9.04 billion in 2015 and that its Net Income increased from $545.34 million in 2014 to $680.53 million in 2015.
On December 7, 2016, a report was published detailing its investigation into Universal Health, which was “…based on interviews with 175 current and former UHS staff, including 18 executives who ran UHS hospitals; more than 120 additional interviews with patients, government investigators, and other experts; and a cache of internal documents.” The report stated that “[c]urrent and former employees from at least 10 UHS hospitals in nine states said they were under pressure to fill beds by almost any method – which sometimes meant exaggerating people’s symptoms or twisting their words to make them seem suicidal – and to hold them until their insurance payments ran out.”
On December 8, 2016, Universal Health Services, Inc published a statement regarding the report and said that it disputes and denies the conclusions in the report.
Shares of Universal Health Services, Inc. (NYSE:UHS) declined from $127.94 per share on December 7, 2016 to as low as $99.72 per share on December 14, 2016.