Humana is currently defending several major lawsuits: a proposed class action alleging it used an artificial intelligence tool to deny post-acute care to Medicare Advantage members, a securities fraud class action brought by investors, a federal False Claims Act case over alleged broker kickbacks, an antitrust suit over out-of-network claim repricing, and an ERISA class action over a tobacco surcharge charged to employees. The insurer also lost two of its own lawsuits against the Centers for Medicare and Medicaid Services challenging its 2025 star ratings and has appealed to the Fifth Circuit. In August 2024, Humana separately paid $90 million to settle a False Claims Act case involving Medicare Part D bids.
AI Denial of Post-Acute Care
The case drawing the most attention is Barrows et al. v. Humana, Inc., filed in December 2023 in the U.S. District Court for the Western District of Kentucky (Case No. 3:23-cv-00654).1Georgetown Law Litigation Tracker. Barrows et al. v. Humana, Inc. The complaint alleges Humana used an algorithm called nH Predict to cut off coverage for Medicare Advantage patients in skilled nursing facilities and other post-acute settings, relying on the model’s predicted length of stay rather than the individualized medical judgment members were promised.2Healthcare Dive. Humana Lawsuit Algorithm Medicare Advantage Deny Claims
Plaintiffs allege that Humana set internal targets requiring patient stays to fall within one percent of nH Predict’s projections and disciplined employees who deviated. When patients appealed AI-generated denials, the denials were reportedly overturned more than 90 percent of the time, which plaintiffs cite as evidence that the model was inaccurate.3Georgetown Law Litigation Tracker. Barrows v. Humana Complaint Named plaintiff Sharon Merkley allegedly received seven denials for the same care within 30 days and five more after successful appeals.4McKnight’s Long-Term Care News. Humana Must Face Class Action Suit Over Use of AI in Denying Post-Acute Care The suit alleges the company counted on the fact that only about two percent of policyholders ever appeal a denial.2Healthcare Dive. Humana Lawsuit Algorithm Medicare Advantage Deny Claims
Humana and naviHealth, the tool’s developer, have said nH Predict is a guide used to inform providers rather than to make final coverage decisions, with a human decision-maker applying CMS criteria.5Becker’s Payer Issues. Humana Uses AI Algorithm From UnitedHealth to Deny Medicare Advantage Claims, Lawsuit Alleges Investigative reporting by STAT found that in practice care managers treated the predictions as a hard rule, and that no peer-reviewed studies had assessed the tool’s accuracy.6STAT News. Medicare Advantage Plans Denial Artificial Intelligence
On June 13, 2026, U.S. District Judge Rebecca Grady Jennings denied Humana’s motion to dismiss the core claims. The judge ruled that plaintiffs did not have to exhaust the Medicare administrative appeals process before suing because the process was “futile” and posed a risk of “irreparable harm.” Claims for breach of contract, breach of the duty of good faith and fair dealing, unjust enrichment, and common law fraud were allowed to proceed. Claims for insurance bad faith, unfair competition, unfair and deceptive insurance practices, and claims settlement practices were dismissed on federal preemption grounds.4McKnight’s Long-Term Care News. Humana Must Face Class Action Suit Over Use of AI in Denying Post-Acute Care
The suit seeks an injunction requiring future claims to be “individually assessed by a medical professional rather than artificial intelligence,” along with actual, statutory, and punitive damages. A status report was due July 10, 2026, and the class has not yet been certified.1Georgetown Law Litigation Tracker. Barrows et al. v. Humana, Inc.
Securities Fraud Class Action by Investors
In re Humana Inc. Securities Litigation (Case No. 1:24-cv-00655-JLH) is pending in the U.S. District Court for the District of Delaware. Filed in June 2024 and consolidated in September 2024, the case names Humana, former CEO Bruce D. Broussard, and CFO Susan M. Diamond, with SEB Investment Management AB serving as lead plaintiff.7Kessler Topaz Meltzer & Check, LLP. Humana Inc.
Investors allege that between July 27, 2022, and October 1, 2024, executives publicly downplayed rising Medicare Advantage utilization driven by a backlog of elective procedures deferred during the pandemic, even as internal data showed benefit expenses climbing. The complaint also alleges executives promoted Humana’s star ratings as a competitive advantage while internal mock surveys had signaled a major downgrade as early as late 2021. Aggressive prior authorization practices and cost-cutting measures allegedly masked rising costs and degraded plan quality.7Kessler Topaz Meltzer & Check, LLP. Humana Inc.
On April 27, 2026, Judge Jennifer L. Hall largely denied Humana’s motion to dismiss, finding the complaint adequately alleged material misrepresentations about both utilization and star ratings, scienter (with support from former-employee testimony about internal meetings), and loss causation tied to corrective disclosures in November 2023, January 2024, and October 2024. The court dismissed star-ratings claims only as to Gamla Liv, which had sold its stock before the October 2024 disclosure and therefore could not show a loss.8U.S. District Court for the District of Delaware. In re Humana Inc. Securities Litigation, C.A. No. 24-655-JLH The case has moved into fact discovery.
Humana’s Own Lawsuits Over 2025 Star Ratings
On October 2, 2024, Humana disclosed that the share of its members in Medicare Advantage plans rated four stars or higher had fallen from 94 percent in 2024 to just 25 percent for 2025, affecting roughly 1.6 million members. A single contract covering about 45 percent of Humana’s Medicare Advantage membership dropped from 4.5 stars to 3.5 stars. Humana’s stock fell 15 percent the morning of the disclosure, and analysts estimated the ratings decline could cost the company between $1 billion and $3 billion in 2026 revenue.9Fierce Healthcare. Humana’s Stock Stumbles After It Reveals Star Ratings Drop10Healthcare Dive. Humana Medicare Advantage Star Ratings
Humana sued CMS in the U.S. District Court for the Northern District of Texas in October 2024, arguing the agency had acted arbitrarily and capriciously and that the company could not replicate 60 percent of CMS’s calculations.11Fierce Healthcare. Humana Joins Chorus of Lawsuits Over Sinking Star Ratings On July 18, 2025, Judge Reed O’Connor dismissed that case without prejudice for failure to exhaust CMS’s administrative appeals process.12Becker’s Payer Issues. Judge Dismisses Humana’s Medicare Advantage Star Ratings Lawsuit
Humana refiled a narrower complaint focused on three phone calls from a CMS study testing foreign-language interpreter availability. Two calls were allegedly disconnected early and one was classified incorrectly, and CMS’s no-callbacks policy prevented recovery, resulting in failing scores that pulled down the entire contract. On October 14, 2025, Judge O’Connor dismissed the refiled case with prejudice, ruling the no-callbacks policy reasonable and the analysis the product of a rational process.13Healthcare Finance News. Humana Loses Second Lawsuit Challenging Medicare Advantage Star Ratings14Healthcare Dive. Humana Medicare Advantage Star Ratings Lawsuit Dismissed Again
Humana and co-plaintiff Americans for Beneficiary Choice appealed to the Fifth Circuit in late November 2025 (Case No. 25-11302). Briefing continued into 2026, with a notice of supplemental authority filed on June 2, 2026.15Healthcare Dive. Humana Appeals Medicare Advantage Star Ratings Case16Georgetown Law Litigation Tracker. Humana Inc. et al. v. Department of Health and Human Services et al. Separately, a proposed CMS rule announced November 25, 2025, would eliminate a dozen star rating measures for Contract Year 2027, including the call center metric at the heart of Humana’s case, though the rule had not been finalized as of mid-2026.17CMS. CMS Proposes New Policies to Strengthen Quality, Access, Competition in Medicare Advantage and Part D
$90 Million Medicare Part D Settlement
In August 2024, Humana agreed to pay $90 million to settle a False Claims Act case alleging it had overcharged the federal government for Medicare Part D prescription drug contracts. The case began with a 2016 whistleblower complaint from Steven Scott, a former Humana actuary, who alleged that from 2011 to 2017 the company maintained “two sets of books”: accurate internal cost projections for business planning and inflated assumptions submitted to CMS in bids that secured higher-paying contracts.18Healthcare Dive. Humana $90M Settlement Medicare Part D Fraud19Phillips & Cohen LLP. Humana Settles for $90 Million The Department of Justice declined to intervene, but Scott’s team pressed forward and the case settled on the eve of trial after the district court denied Humana’s summary judgment motions. Humana did not admit wrongdoing.
DOJ Broker Kickback Case
On May 1, 2025, the U.S. Department of Justice filed a False Claims Act complaint against Humana, CVS Health’s Aetna, and Elevance Health, along with brokers eHealth, GoHealth, and SelectQuote. The case, United States ex rel. Shea v. eHealth, et al. (Case No. 21-cv-11777), is pending in the U.S. District Court for the District of Massachusetts.20U.S. Department of Justice. United States Files False Claims Act Complaint Against Three National Health Insurance Companies
The DOJ alleges that between 2016 and 2021, the insurers paid hundreds of millions of dollars in illegal kickbacks to steer seniors into their Medicare Advantage plans regardless of fit, and that Aetna and Humana went further by pressuring brokers to avoid enrolling disabled beneficiaries in order to limit costs.21Healthcare Dive. DOJ CVS Humana Elevance Medicare Advantage Broker Kickbacks On March 25, 2026, the court denied the defendants’ motion to dismiss the kickback and discrimination allegations, dismissing only the unjust enrichment claim because the False Claims Act provided a sufficient remedy.22Becker’s Payer Issues. Judge Rules Aetna, Elevance, Humana Must Face Medicare Kickback Allegations
Antitrust Case Over Out-of-Network Repricing
Humana is one of five major insurers named alongside health-tech vendor Zelis Healthcare in a consolidated antitrust case in the U.S. District Court for the District of Massachusetts (Lead Case No. 25-10734-BEM). The other insurer defendants are Aetna, Cigna, Elevance Health, and UnitedHealth Group.23Fierce Healthcare. 5 Major Insurers, Vendor Zelis Must Face Repricing Antitrust Claims, Judge Rules
Healthcare providers allege a hub-and-spoke conspiracy in which Zelis uses its repricing tools to systematically slash payments for out-of-network services on behalf of the insurer defendants. One plaintiff alleged a claim was repriced at a discount of more than 88 percent.24Insurance Business Magazine. Massachusetts Court Greenlights Antitrust Suit Against Zelis, Aetna, Cigna, UnitedHealth23Fierce Healthcare. 5 Major Insurers, Vendor Zelis Must Face Repricing Antitrust Claims, Judge Rules25U.S. District Court, District of Massachusetts. Pacific Inpatient Medical Group, Inc. et al. v. Zelis Healthcare, LLC et al.
ERISA Class Action Over the Tobacco Surcharge
In March 2026, a former Humana employee filed a proposed class action, Cassady v. Humana Inc. et al. (Case No. 3:26-cv-00187), in the U.S. District Court for the Western District of Kentucky.26Bloomberg Law. Former Humana Employee Sues Over Health Plan’s Smoker Penalty The suit alleges Humana charged employees who smoke an extra $80 per month for health coverage without adequately explaining how to waive the surcharge by completing a wellness program, and without guaranteeing retroactive reimbursement for workers who qualified. The complaint characterizes the charge as a penalty rather than a compliant wellness incentive under ERISA rules for health-contingent wellness programs.27BenefitsPRO. Humana Accused of Violating ERISA Over Hidden Tobacco Surcharges The proposed class is open to U.S.-based individuals who paid the surcharge since 2014.
Where the Cases Stand
None of Humana’s active cases have reached final judgment as of mid-2026, and the company has not admitted wrongdoing in the matters that have settled. The most recent rulings have gone against Humana on threshold motions: courts have allowed the Barrows AI case, the securities class action, and both the broker kickback and Zelis repricing cases to move past motions to dismiss, while Humana’s own challenges to its 2025 star ratings sit before the Fifth Circuit on appeal.