Shares of UnitedHealth Group Inc. (UNH) plummeted 7.64% in pre-market trading on Friday, following news that the U.S. Justice Department has launched an investigation into the company's Medicare billing practices.

According to reports, the civil fraud investigation is examining UnitedHealth's practices for recording diagnoses that trigger extra payments to its Medicare Advantage plans, including at physician groups the insurance giant owns. The probe comes after a series of articles published by The Wall Street Journal last year raised questions about billions of dollars in questionable diagnoses that led to higher Medicare payments for UnitedHealth.

The investigation focuses on whether UnitedHealth improperly encouraged its healthcare providers to add lucrative diagnoses to patient records, even if the conditions were not treated or relevant. This practice could potentially inflate the payments the company receives from the federal government for its Medicare Advantage plans.