UnitedHealthcare, a unit of UnitedHealth Group (NYSE: UNH), is facing a federal lawsuit over its use of an artificial intelligence tool in making Medicare Advantage claims denials for patients in extended care facilities.
That same issue was at the center of a recently published piece in STAT, a health-oriented news outlet.
Aaron Albright, a spokesperson for Optum, the unit of UnitedHealth involved in the lawsuit’s claims, told Skilled Nursing News that the AI tool used in assessing claims is more for guidance and not for denial of insurance claims.
“The [NaviHealth] predict tool is not used to make coverage determinations. The tool is used as a guide to help us inform providers, families and other caregivers about what sort of assistance and care the patient may need both in the facility and after returning home,” said Albright, via an emailed statement. “Coverage decisions are based on CMS coverage criteria and the terms of the member’s plan. This lawsuit has no merit, and we will defend ourselves vigorously.”
The high level of denials were generated because UnitedHealth’s AI tool – one developed by its subsidiary NaviHealth – does not use input from doctors to predict the length of stay for patients in long-term care, according to the Class Action Complaint. Instead, the tool compares a patient’s demographic and medical information against a database of other similar patients, and uses that information to determine how many days United Healthcare will approve a necessary stay at a care facility, the plaintiffs’ lawyers said in a press release. This often “undercuts the amount of time recommended by a physician,” they argue.
Upon appeal, the MA denials don’t not hold up once doctors and medical experts review the claims, the lawsuit alleges. In fact, claims denials were reversed in 90% of the cases. That said, the lawyers note that currently, only around 0.2% of patients submit their claims for appeals, with the majority of residents having to pay out of pocket for the rest of their stay at a care facility.
And the STAT article points out that NaviHealth is used by other large insurance companies as well. “NaviHealth doesn’t just manage nursing home care within UnitedHealth’s plans, but also serves large Medicare Advantage insurers such as Humana and many regional health plans — potentially affecting the care of more than 15 million people, or half of all Medicare Advantage enrollees,” the article states.
NaviHealth set a target for 2023 to keep rehab stays of patients in MA plans within 1% of the days projected by the algorithm, STAT reported, citing internal documents that the publication obtained. The lawsuit seeks to stop UnitedHealth’s use of AI to replace doctor’s orders as well as get restitution for emotional distress damages, compensatory damages and punitive damages, the law firm’s press release stated.