The Lying Machine
1st June 2026
There is a lawsuit grinding through a federal court in Minnesota that every insurance executive in America should be reading instead of their quarterly AI roadmap.
The case is Estate of Lokken v. UnitedHealth Group. It was filed in late 2023 by the families of two deceased Medicare Advantage members, and it alleges that UnitedHealthcare used an artificial-intelligence tool called nH Predict to decide how much post-acute care its members were entitled to — and that the tool was wrong roughly nine times out of ten, a figure the plaintiffs draw from how often its denials were reversed on appeal. UnitedHealth denies that the tool makes coverage decisions at all; it calls nH Predict “a guide” and says the real decisions are made by clinicians following Medicare criteria. A judge will sort out who’s right. But this past March, that judge ordered the company to open its books and hand over a wide swath of documents about exactly how the thing works. The machine is going to testify.
I’m not here to litigate that case. I’m here because of the legal theory the plaintiffs were allowed to keep. The court tossed several of their claims but let two survive, and one of them should make every carrier’s general counsel sit up straight: breach of the implied covenant of good faith and fair dealing. Bad faith. The doctrine that turns a wrong coverage decision from a refund into punitive damages.
Hold onto that, because it’s the whole column.