Becker's Healthcare: UnitedHealth wants Medicare Advantage algorithm denials suit tossed

May 22, 2024 | By Andrew Cass

This story was originally published by Becker's Healthcare.

UnitedHealth Group said a proposed class-action lawsuit alleging an AI algorithm wrongfully denied Medicare Advantage patients care should be dismissed because "plaintiffs have failed to exhaust the exclusive administrative appeal process set by the Medicare Act for challenging coverage determinations."

"The Medicare Act, CMS regulations, and plaintiffs' Medicare Advantage plans specify an exclusive administrative procedure that plaintiffs must complete before bringing their case to federal court," UnitedHealth argued in a May 20 court filing. "None of the plaintiffs have completed Medicare's administrative appeal process, and some have not appealed at all."

The motion seeking dismissal is in response to a November lawsuit filed in Minnesota federal court alleging the company's insurance arm — UnitedHealthcare — used an artificial intelligence-powered algorithm, nH Predict, to set coverage criteria for patients in post-acute care. The algorithm predicts how long a patient will need to remain in skilled nursing care, but overrides physicians' determinations of what care a patient needs. 

The lawsuit was filed by the families of two deceased UnitedHealthcare Medicare Advantage members. The families alleged the two men were wrongfully denied coverage of medically necessary post-acute care by UnitedHealthcare. NaviHealth, the developer of the algorithm, was also named in the suit. 

UnitedHealth further argued in its motion for dismissal that even if the plaintiffs had "exhausted or were able to show an exceptional circumstance exempting them from appealing through all four required levels of the exclusive process, plaintiffs have sued the wrong defendants." The company said the Medicare Act requires the plaintiffs to sue HHS, not the insurance companies. (Becker's Healthcare)