Humana is 2nd insurer to face lawsuit for AI-based denials of Medicare Advantage claims
One of the nation’s largest health insurance providers was using the same AI tool, nH Predict – with an alleged 90% error rate that overrides medical judgment – that UnitedHealthcare was sued for in November.
Humana is the latest insurer to be sued over allegations that it used artificial intelligence algorithms to deny certain rehabilitation care under Medicare Advantage. A similar lawsuit was filed against United Healthcare last month.
The lawsuit against Humana was filed Dec. 12 in the U.S. District Court for the Western District of Kentucky. The two plaintiffs said the affected class could “number in the thousands to millions.”
The AI model that Humana uses, nH Predict, was developed by UnitedHealth Group subsidiary NaviHealth, which it acquired in 2020. The model is designed to predict length of stay in skilled nursing facilities, but the lawsuit alleges that the algorithm has a high rate of error. It also claims patients were forced to prematurely end their care or pay out of pocket after claims were denied.
“As such, Humana makes coverage determinations not based on individual patients’ needs but based on the outputs of the nH Predict AI model, resulting in the inappropriate denial of necessary care prescribed by the patients’ doctors,” the plaintiffs said. “Humana’s implementation of the nH Predict AI model resulted in a significant increase in the number of post-acute care coverage denials.”
Human spokesperson Mark Taylor told Louisville Public Media that the company does not comment on pending litigation but that it does use “augmented intelligence” as a tool.
“By definition, augmented intelligence maintains ‘human-in-the-loop’ decision-making whenever AI is utilized,” he said. “Coverage decisions are made based on the health-care needs of patients, medical judgment from doctors and clinicians, and guidelines put in place by the Centers for Medicare and Medicaid Services.”
UnitedHealth Group is the target of a class-action lawsuit filed last month. One allegation is that UnitedHealth uses nH Predict to evaluate claims for post-acute care, including in-home care and extended stays in skilled nursing facilities, and that the company uses the algorithm to “prematurely and in bad faith” halt payments for health-care services.
The lawsuits come as Congress and the Biden administration express concerns about coverage denials in Medicare Advantage. A bipartisan group of lawmakers has been probing how often seniors in the program are denied care compared with those in traditional Medicare.
Related: Denied by AI: Medicare Advantage’s ‘predictive’ software cuts off care, say feds
In November, a Senate panel sent a bipartisan letter questioning some of the largest Medicare Advantage plans about their policies on coverage denials, including the use of AI-powered algorithms. House Democrats recently called for stricter oversight of AI algorithms by CMS. In January, a new federal rule will begin restricting how Medicare Advantage plans use predictive algorithms to make some coverage decisions.