UnitedHealth Lawsuit Filed Over Allegedly Misleading Medicare Advantage Ads

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A proposed class action alleges UnitedHealth has misleadingly advertised that its Medicare Advantage plans combine the benefits of original Medicare, Parts A and B, with additional benefits, and that Medicare Advantage includes “all the benefits of Medicare.” 

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The 62-page lawsuit contends that UnitedHealth’s inaccurate Medicare Advantage ads are central to a purported scheme whereby the insurer aims to divert vulnerable beneficiaries out of the government-funded original Medicare and Medicaid programs and into United’s own “overly profitable, commercially driven” Medicare Advantage plans. 

Although UnitedHealth expressly touts Medicare Advantage as an “enhancement” to original Medicare, misled consumers who enroll in Medicare Advantage plans are, in truth, required to forfeit their original Medicare benefits completely and are left with a commercial insurance product with substantial restrictions, the suit alleges. 

“United’s conscious non-disclosure of material facts to their [Medicare Advantage] enrollees of their highly restricted and shrinking MA network of participating hospitals and providers, limited geographic area of services, substantially restricted skilled nursing facility services, restricted specialist access, prior authorization requirements and known improper denials, pre-payment medical record reviews, and high rate of improper payment denials are core to its oversized MA member enrollment,” the lawsuit charges.

As a result of UnitedHealth’s intentionally confusing marketing, the case says, Medicare Advantage members wrongfully present their government-issued original Medicare cards for services and are ultimately denied by both Medicare and United, leaving the consumer with full responsibility for the out-of-pocket costs. 

The filing says the impact of UnitedHealth’s deliberate deception is “profound and far-reaching” in that enrollment in Medicare Advantage has grown based on the exploitation of “a demographic that is most often elderly, disabled, and financially constrained.” 

“This vulnerable demographic relies heavily on clear and accurate information to make informed healthcare and financial decisions at a critical time in their life,” the suit relays, claiming United’s messaging about Medicare Advantage has caused a widespread misunderstanding about the nature of the plans, leading some beneficiaries to hand over their Medicare benefits “without ever being advised or understanding that they have done so. 

According to the complaint, United now insures a third of all Medicare Advantage beneficiaries nationwide, and a fifth of its insureds are under Medicare Advantage plans. The case adds that the defendants’ Medicare Advantage plans are “200% as profitable as other plans,” and, as an added benefit, are funded entirely by taxpayers. 

“United MA’s growth has been fueled by aggressive marketing tactics that prioritize profitability over transparency, always at the expense of the most vulnerable,” the case alleges. 

Overall, UnitedHealth has systematically overbilled the Medicare Trust while misrepresenting the health of its members to secure inflated government reimbursements, the lawsuit claims. At the same time, the insurer underpays healthcare providers with rates significantly lower than standard Medicare fees and denies beneficiaries access to necessary medical care, the filing says. 

The case looks to cover all persons who bought Medicare Advantage plan health insurance from UnitedHealth in the United States or its territories within the last four years. 

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