UnitedHealth Seeks Dismissal of Ballad Health Medicare Advantage Lawsuit

UnitedHealth Group has filed a motion in federal court in Tennessee to dismiss a lawsuit initiated by Ballad Health, a healthcare system based in Johnson City, Tennessee.

The lawsuit accuses UnitedHealth of systematically denying medically necessary care and underpaying for services offered to Medicare Advantage members across Ballad's 19 hospitals. Ballad Health is seeking damages exceeding $65 million and aims to invalidate the arbitration clauses in its contracts with UnitedHealth.

UnitedHealth contends that Ballad Health's predecessor organizations had previously agreed to binding arbitration as the dispute resolution method in facility participation agreements from 2010 and 2014, which Ballad has admitted to being bound by. The insurer's legal team characterizes Ballad's lawsuit as an attempt primarily to gain publicity rather than a substantial legal challenge to arbitration agreements.

Additionally, UnitedHealth argues that Ballad's claims conflict with federal standards governing Medicare coverage determinations and lack sufficient specifics to support allegations of breach of contract and fraud. Ballad Health has stated that pursuing legal action was a last resort in response to what it perceives as harmful practices by UnitedHealth affecting patients, healthcare providers, and community hospitals.

The healthcare system also announced it will not renew its Medicare Advantage contract with UnitedHealth upon its expiration in June 2027. This dispute highlights ongoing tensions in Medicare Advantage contracting, provider reimbursement, and dispute resolution mechanisms, with implications for hospital and insurer negotiations and federal regulatory oversight.