A lawsuit against UnitedHealth alleges that an algorithm used to estimate patients’ needs after hospital stays helped lead to premature denials of covered care. The case focuses on older people in Medicare Advantage plans who were receiving rehabilitation or nursing care after an injury, illness, or other acute event.
What the lawsuit alleges
The suit was filed in the US District Court for the District of Minnesota by the estates of two people who died after their coverage was denied. It seeks class-action status for others in similar circumstances, potentially tens of thousands of people across the country, according to the complaint.
At issue is nH Predict, a tool developed by NaviHealth, a UnitedHealth subsidiary. The lawsuit says UnitedHealth began using it in at least November 2019 and continues to use it. The tool estimates a patient’s post-acute care needs, including the length of a stay and a possible discharge date.
Post-acute care can include therapy and skilled services provided at home, in a nursing home, or at an inpatient rehabilitation center. The lawsuit says nH Predict’s projections were used in decisions that cut off coverage, despite treating doctors’ judgments that more care was needed.
How the tool is described
The article says the algorithm’s precise operation is unclear. According to the lawsuit and reporting by Stat, case managers enter details such as a patient’s age, living situation, and physical abilities. The system compares those details with cases in a database containing medical records from 6 million patients.
A former NaviHealth case manager told Stat that the model did not account for important differences in health and recovery. The examples cited include other medical conditions and complications that arise during care, such as pneumonia or COVID-19.
The lawsuit and Stat’s investigation describe estimates that can be substantially shorter than the care patients and clinicians believe is necessary. The article gives the example of nursing home stays: it says patients with a three-day hospital stay are typically entitled to up to 100 days of covered nursing home care under a Medicare Advantage Plan, while patients using nH Predict rarely stayed more than 14 days before UnitedHealth denied payment.
Appeals, targets, and company response
The lawsuit says patients and doctors who asked to see nH Predict reports were told the information was proprietary. It also alleges that when treating physicians disagreed with UnitedHealth’s view of a patient’s care needs, their assessments were overridden.
According to the complaint, more than 90 percent of denials based on nH Predict were reversed when members appealed, either through UnitedHealth’s internal process or federal Administrative Law Judge proceedings. The lawsuit argues that this reversal rate shows the estimates were inaccurate. It further says employees were pushed to keep nursing home stays close to the algorithm’s projections: within 3 percent of the predicted days in 2022, and within 1 percent in 2023.
Former employees told Stat that NaviHealth’s priorities shifted toward performance measures and shorter post-acute stays after UnitedHealth acquired the company in 2020. The article reports that case managers who missed length-of-stay targets could face discipline or termination. Amber Lynch, an occupational therapist and former case manager, told Stat she was fired after missing the target and falling behind on documentation.
UnitedHealth’s subsidiary Optum Health said the naviHealth predict tool is not used to make coverage decisions. It described the tool as a guide for informing providers, families, and caregivers about support a patient may need, and said coverage is based on CMS criteria and the member’s plan. The company called the lawsuit meritless and said it would defend itself.
The article notes that physician medical reviewers make the final coverage decisions, while case managers advise them and are held to the stated targets. It also describes training materials instructing case managers how to respond when patients or caregivers challenge a denial, including by explaining that projections compare a patient with similar cases.
Why the dispute matters to patients
The allegations raise a practical question for people receiving rehabilitation or skilled nursing care: how much influence can a model’s estimate have when a clinician believes a patient needs more time? A projection can help organize information, but the lawsuit argues that narrow targets and pressure on staff can make an estimate shape care decisions even if the tool is officially described as guidance.
Appealing may not end the dispute, either. The source article says that even patients who successfully challenge an AI-backed denial can receive another denial soon afterward, sometimes within days. The suit’s claims have not been established as findings of fact; UnitedHealth disputes them and says the algorithm does not determine coverage.