Massachusetts Sues UnitedHealthcare Over Alleged $100 Million MassHealth Billing Fraud

Massachusetts Attorney General Andrea Joy Campbell has sued UnitedHealthcare Insurance Company, accusing the insurer of receiving more than $100 million in improper MassHealth payments by allegedly overstating the care needs of seniors enrolled in a Medicaid managed-care program.

The complaint, filed May 29 in Suffolk County Superior Court, claims UnitedHealthcare, doing business as UnitedHealthcare Community Plans of Massachusetts, submitted inaccurate health assessments for members in its Senior Care Options plan. The assessments allegedly caused MassHealth, the state’s Medicaid program, to pay the company more than it should have.

Senior Care Options serves MassHealth members age 65 and older. MassHealth pays private insurers a fixed monthly rate per member, with higher rates for seniors classified as needing more care. UnitedHealthcare’s own assessments determined whether a member fell into Level 1, the lowest payment category, Level 2, for certain behavioral health or substance use conditions, or Level 3, the highest category for members with serious care needs.

UnitedHealthcare was paid more than $5 billion by MassHealth from 2014 through 2025 for its Senior Care Options plan, the filing states. More than $3.8 billion involved members living in community settings, rather than nursing homes or other institutions. Level 3 payments accounted for about $2.96 billion in community-based payments during that period.

Massachusetts argues that UnitedHealthcare repeatedly placed members in higher payment levels than their records supported. Some seniors were allegedly classified at Level 2 after the insurer listed conditions such as depression or anxiety, even though they allegedly lacked a corresponding diagnosis or treatment. Others were allegedly kept in Level 3 despite records that did not support the highest MassHealth reimbursement rate.

The attorney general’s office also claims UnitedHealthcare later moved some members from Level 3 to Level 1 or Level 2 after internal reviews and audits, despite no clear change in their medical condition. The state says the insurer did not tell MassHealth that those members had allegedly been overclassified before the downgrade and did not return the difference between the higher payments it received and the lower amounts the state says should have applied.

A major allegation involves skilled nursing services. Level 3 could be triggered when a member needed daily skilled services, or skilled nursing at least three times per week, combined with help in daily activities such as bathing, dressing, or moving around.

Massachusetts says it reviewed 88,696 Level 3 assessments submitted between 2014 and 2024 and found that 99.3 percent listed members as receiving visiting nursing services seven days per week. The state’s analysis claims billing data showed no nursing visit in the week before the assessment for 89.47 percent of those entries.

The complaint also describes alleged warning signs inside UnitedHealthcare. Massachusetts says managers were told that assessments included copied-and-pasted language, inaccurate diagnoses, and information that did not match medical records. MassHealth audits allegedly raised similar concerns, including a 2018 review in which 16 out of 30 Level 3 assessments were not supported by other member documentation.

Under the Massachusetts False Claims Act, the state may seek damages and penalties when a company allegedly obtains public money through false claims or false records, or keeps money after learning it was overpaid. The law can apply when a company allegedly knows information is false, ignores the truth, or acts with reckless disregard for accuracy.

The state argues the care-level assessments were material because MassHealth relied on them to set UnitedHealthcare’s monthly payments. Health care fraud cases often use the term upcoding when records describe care as more serious or costly than the underlying documentation supports.

Massachusetts also brings common-law claims for unjust enrichment and breach of contract. The attorney general’s office is seeking damages, civil penalties, litigation and investigation costs, and treble damages where allowed by law.