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UnitedHealth's headquarters in Minnetonka, Minnesota. (Photo: UnitedHealth)

Life Health > Health Insurance > Medicare Planning

UnitedHealth Faces Suit Over AI-Based Medicare Advantage Claim Denials

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The estates of two Medicare Advantage plan enrollees are suing UnitedHealth Group over the use of an automated system for managing coverage for skilled nursing facility care, rehabilitation facility care and other forms of post-acute care.

The plaintiffs say the company’s nH Predict system is too rigid.

The plaintiffs filed the complaint in the U.S. District Court for the District of Minnesota and are seeking national class-action status.

In addition to UnitedHealth, the list of defendants includes a UnitedHealth health insurance subsidiary, UnitedHealthcare, and the subsidiary that runs the nH Predict system, naviHealth.

The plaintiffs have accused the defendants of breach of contract, unjust enrichment and violation of state good-faith requirements.

Representatives for UnitedHealth were not immediately available for comment.

The patients: One of the patients involved in the suit, Gene Lokken, was a 91-year-old man who broke his leg in May 2022, went to the hospital and later entered hospice care.

After covering three weeks of hospice care, UnitedHealth said Lokken should be discharged.

His family appealed and lost. Lokken had out-of-pocket care expenses ranging from $12,000 to $14,000 per month until July 17, when he died.

The other patient, Dale Henry Tetzloff, was a 74-year-old man who had a stroke in October 2022. He received care in a hospital and then entered a skilled nursing facility.

After Tetzloff was in the facility for 20 days, UnitedHealth denied further coverage for facility care.

Tezloff and his wife appealed but lost. Tetzloff entered an assisted living facility and lived there until Oct. 11, when he died. His out-of-pocket expenses averaged $7,000 per month for 10 months.

The nH Predict System: The nH Predict artificial intelligence model compares information about a patient’s diagnosis, age, living situation and physical function with a database of 6 million patient records.

The system then uses the comparison to predict patients’ medical needs and expected discharge dates, according to the complaint.

The model “spits out generic recommendations that fail to adjust for a patient’s individual circumstances and conflict with basic rules on what Medicare Advantage plans must cover,” the plaintiffs assert.

The plaintiffs cite allegations in a STAT news article that UnitedHealth required workers to hold stays in skilled nursing facilities to within 1% of the days projected by the AI model.

“Employees who deviate from the nH Predict AI Model projections are disciplined and terminated, regardless of whether a patient requires more care,” the plaintiffs assert.

Credit: UnitedHealth


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