UnitedHealthcare defrauded MassHealth of $100M, AG Campbell alleges

Attorney General Andrea Campbell sued UnitedHealthcare Insurance Company on Friday, accusing the insurer of misclassifying the conditions of elderly members and defrauding MassHealth of at least $100 million.

United fired back that Campbell's lawsuit is "meritless" and inaccurately captures the purpose of a managed care program.

The lawsuit revolves around MassHealth members ages 65 and up enrolled in the Senior Care Options plan. It alleges that United "falsely manipulated" their health evaluations in order to secure bigger payments, Campbell's office said. Members are assessed from Level 1 to Level 3, with higher levels corresponding to more serious conditions and higher payment rates.

"The state's managed care plans need to act in good faith on behalf of their members and the financial resources of our state's Medicaid program," Campbell said in a statement. "Our investigation found that United Healthcare knowingly violated these obligations by manipulating health assessments to increase its profits. This lawsuit sends a clear message that no company is above the law, and my office will hold companies accountable for exploiting vulnerable residents and misusing taxpayer dollars."

The lawsuit, filed in Suffolk Superior Court, comes as MassHealth officials look to slash spending at the agency amid looming federal funding cuts. The agency dominates the state budget and is slated to receive roughly $22 billion in fiscal 2027.

Campbell's office said United classified some members as Level 2 — intended for those with behavioral health or substance use disorders — even though they "lacked any corresponding diagnosis or treatment."

The AG also accused United of designating "many members" as Level 3 even though they did not qualify for that scope of services. Campbell's office contends United became aware of the Level 3 misclassifications through internal reviews but "never disclosed" the issue to MassHealth or repaid MassHealth "for any of the improperly inflated payments."

United also submitted assessments that said members needed daily skilled nursing services, while "most" of those individuals did not receive or need that care, the lawsuit alleges.

In a statement to the News Service, United said it is focused on working "with our state partner to help our members live healthier lives."

"The Massachusetts Attorney General's complaint is meritless and doesn't accurately describe our Senior Care Options program, which helps seniors with complex care meet their individual health needs," United said. "The Attorney General is simply wrong that Massachusetts seniors with complex care needs should not be receiving the support and services UnitedHealthcare is helping to provide."