DOJ Steps into Whistleblower Lawsuit Against SelectQuote Over Medicare Advantage Sales Practices

SelectQuote Under Fire: What DOJ Scrutiny Means for Medicare Advantage and Insurance Compliance

The insurance world is watching closely as SelectQuote Inc., a digital insurance platform best known for its Medicare Advantage business, finds itself in the crosshairs of both the Department of Justice and a class of investors. The case isn’t just about one company, it’s a lens into the growing scrutiny over compliance and sales ethics across the industry.

What’s Happening with SelectQuote?

At the heart of the matter is a whistleblower lawsuit, now joined by the DOJ. The government alleges that from 2016 through at least 2021, SelectQuote engaged in questionable practices. These include steering customers away from less profitable plans and receiving improper payments, actions that could amount to deceptive sales tactics under federal law.

When the DOJ publicly stepped in, markets reacted fast. SelectQuote’s stock price fell nearly 20% in a single day, with shares tumbling more than 40% over the following six months. For investors, the lawsuits raise painful questions about whether they were given the full picture.

“This case underscores just how tightly regulatory compliance and market trust are intertwined in the insurance sector.”

Investor Fallout

The class-action complaint, led by shareholder rights firm Hagens Berman, argues that SelectQuote misled investors. The company’s public stance of being an “unbiased” broker allegedly masked a system driven by kickbacks.

The suit specifically covers investors who bought stock between September 9, 2020, and May 1, 2025. Their claim: the company failed to disclose the risks tied to its Medicare Advantage practices, creating an inflated sense of growth potential.

Why This Case Matters for the Insurance Industry

For carriers, brokers, and digital platforms alike, this isn’t just about SelectQuote. The case highlights how compliance lapses, or even the appearance of them, can ripple across the industry.

• Federal scrutiny is intensifying. The DOJ’s involvement signals a stronger enforcement stance on sales practices in Medicare Advantage.

• Investor trust is fragile. Even hints of undisclosed risks can trigger shareholder lawsuits and steep market declines.

• Ethical sales are under the microscope. From steering practices to alleged kickbacks, regulators want clearer guardrails to protect both consumers and investors.

“The industry can’t afford to view compliance as a box-checking exercise, it’s a pillar of long-term trust.”

Looking Ahead

SelectQuote’s legal battles are far from over, and outcomes could reshape not only the company’s future but also regulatory oversight of digital insurance platforms. Industry professionals should be asking: how do we strengthen compliance frameworks, ensure transparency, and maintain consumer trust in an increasingly scrutinized Medicare Advantage market?

The SelectQuote case is a reminder that reputation, regulation, and revenue are more connected than ever. For insurance leaders, the challenge will be turning compliance into a competitive advantage rather than a compliance burden.