Appeals court tosses lawsuit accusing UnitedHealth of misleading seniors

A federal appeals court affirmed a lower-court ruling Tuesday that defendants cannot challenge how UnitedHealthcare markets its Medicare Advantage plans on state-law grounds.

In March, California District Court Judge Monica Ramirez Almadani tossed the lawsuit solely on federal preemption grounds. A three-judge panel from the 9th U.S. Circuit Court of Appeals agreed.

The lawsuit, The Estate of Bibi Ahmad v. UnitedHealth Group Inc., et al., accused UnitedHealth of deceptively marketed Medicare Advantage plans. Plaintiffs make claims under California’s False Advertising Law, Unfair Competition Law, and Consumers Legal Remedies Act.

State law has no controlling interest, the appeals court ruled.

“The Estate brings state law claims regarding allegedly misleading marketing materials and communications for a United Medicare Advantage plan,” Tuesday’s ruling reads. “Such Medicare Advantage plan marketing and communications are subject to CMS approval and extensive regulatory oversight.”

'Aggressive marketing tactics'

For years, UnitedHealth advertised seamless healthcare, the lawsuit alleged. Colorful brochures and cheerful commercials convinced seniors that UnitedHealth’s Medicare Advantage plans were designed to enhance existing government coverage, combining everything you need into one convenient package, plaintiffs say.

Instead of merely supplementing their original Medicare, seniors discovered a harsh reality after enrolling, the lawsuit claims. By signing the dotted line, they had unknowingly surrendered their government-backed benefits, trading them away for a private plan that replaced their original coverage entirely.

UnitedHealth now insures about one-third of all MA beneficiaries in the United States, plaintiffs claim, and a fifth of its health insurance customers are under MA plans. United’s MA plans are "200% as profitable as its other plans," the complaint states, and have the added benefit of being funded entirely by taxpayer dollars in the form of guaranteed monthly government payments.

"United’s MA growth has been fueled by aggressive marketing tactics that prioritize profitability over transparency, always at the expense of the most vulnerable," the lawsuit says.

In one example, A 96-year-old Southern California cancer survivor was allegedly stripped of her original Medicare coverage and left without medical recourse due to deceptive enrollment practices by UnitedHealthcare, the lawsuit alleges.

© Entire contents copyright 2026 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.