UnitedHealth's headquarters in Minnetonka, Minnesota. (Photo: UnitedHealth)
UnitedHealth Group will not be allowed to narrow the scope of discovery in an ongoing lawsuit accusing the insurance giant of wrongfully denying Medicare Advantage coverage through the use of artificial intelligence. A Minnesota federal judge issued the ruling in a case that was filed in 2023.
The lawsuit, filed by the families of two deceased Medicare Advantage members, alleged that UnitedHealth knowingly used a faulty AI algorithm to deny elderly patients coverage for extended care deemed necessary by their doctors. "The elderly are prematurely kicked out of care facilities nationwide or forced to deplete family savings to continue receiving necessary medical care, all because UnitedHealth's AI model 'disagrees' with their real live doctors' determinations," the complaint said.
The use of the allegedly defective AI model, developed by NaviHealth and called nH Predict, enabled the insurance company to "prematurely and in bad faith discontinue payment" to its elderly beneficiaries, causing them medical or financial hardships, the lawsuit said. Earlier this year, a federal judge dismissed several claims but allowed those dealing with breach of contract and the implied covenant of good faith and fair dealing to proceed.
UnitedHealth requested a two-phase discovery process in which broader discovery would be allowed only if the plaintiffs survived summary judgment in the first phase. The judge, however, denied the request, saying it would create unnecessary delays, duplicate litigation and disputes over whether certain discovery requests related to class action certification or the merits of the case. The court added that UnitedHealth already has resisted discovery in earlier stages of the case and that its proposal ultimately would work against the plaintiffs.
AI algorithms may help insurance companies automate between half and three-quarters of the manual work involved in approving insurance requests, such as gathering medical information and cross-validating date with patient records, McKinsey estimated. However, the use of AI in Medicare Advantage has come under increasing scrutiny.
A 2023 lawsuit alleged that Humana also used nH Predict to wrongfully deny Medicare Advantage members’ claims. Last month, a federal judge dismissed some state-law claims but allowed others, including breach of contract and fraud, to proceed. In early 2024, the Centers for Medicare & Medicaid Services issued guidance stipulating that algorithms can be used to help predict patient needs but not used solely to make coverage decisions.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.