Denials of insurance coverage have increased in recent years in the United States, thanks in part to automated algorithms powered by AI – and some recently launched artificial intelligence tools could fight back by generating robocalls.
But to see more lasting change, health experts say the health insurance system needs deeper reform to control high prices and ensure coverage.
UnitedHealth, Humana and Cigna face class action lawsuits alleging that insurers relied on algorithms to deny life-saving care.
One of the lawsuits alleges that Cigna rejected more than 300,000 claims over a two-month period, which equates to approximately 1.2 seconds for each claim reviewed by a doctor. Such a practice is facilitated by algorithms, according to the lawsuit.
In 2020, UnitedHealth Group acquired naviHealth and its care prediction algorithm, called nH Predict, which UnitedHealth also uses and outsources to other insurers, including Humana. (A UnitedHealth Group spokesperson denied that the algorithm is used to make coverage decisions; Humana did not respond to a request for comment.)
The lawsuit against them alleged that NH Predict has a 90% error rate, meaning that nine out of 10 denials are overturned on appeal – but very few patients (about 0.2%) appeal their denied claims , leading them to pay their bills out of pocket or forgo necessary treatment.
This figure corresponds to a investigation by the nonprofit KFF, which found that fewer than 0.2 percent of people purchasing insurance through HealthCare.gov use in-network claims that are denied.
When it comes to prior authorization, the practice in which doctors and patients must receive approval from an insurance company before starting care or medications, fewer than 10 percent of claims are denied in Medicare Advantage plans (Medicare-approved plans from a private company) were appealed. 2022, according to another KFF investigation.
Medical practices now have entire departments dedicated to process and appeal prior authorization decisions.
Nearly half of U.S. adults say they have unexpectedly received a medical bill or been charged a co-pay, a study finds. investigation of the Commonwealth Fund.
Four in five people said these delays caused worry and anxiety, and almost half said their condition worsened because of the delay in care. Most did not know they could appeal a refusal.
But for those who try to appeal, the process can be so labyrinthine that they are forced to give up.
Two of her three sons have severe food allergies. So Deirdre O’Reilly was worried about sending any of them to college. When he had a reaction, he went to the emergency room as usual.
But this time, the insurance company denied coverage for the entire visit — nearly $5,000, according to a denial letter reviewed by the Guardian. O’Reilly tried to appeal four times, and each time the insurer, BlueCross BlueShield of Vermont, gave her a different reason, she said.
“My son had no choice: He was going to die if he didn’t get to the nearest emergency room,” O’Reilly said.
She should know; she is a critical care physician at the University of Vermont. She’s seen denials like these happen to her own patients, like premature infants who were denied oxygen equipment.
“It’s gotten out of control. It’s changed tremendously in the 20 years I’ve been a doctor,” she said. “I can’t believe people have to go through this just to get health coverage – things that are basic needs. »
And many people don’t have the same medical expertise or the same time or resources for lengthy appeals processes.
“I was tenacious,” she says. “But at some point I couldn’t fight as much.”
A spokeswoman for BlueShield Vermont said in a statement that she could not comment on an individual’s health record, but denied the use of algorithms in care management. “Most” of the prior authorization decisions were made by the insurer’s team of doctors and nurses based on national guidelines, she said.
Vermont is one of several states that have recently passed legislation aimed at reducing prior authorization pressure.
Automated denials in particular have faced increased scrutiny from federal and state lawmakers.
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UnitedHealthcare, CVS and Humana – the three largest Medicare Advantage providers, together providing nearly 60% of all Medicare Advantage coverage – are rejecting prior authorization requests at high rates using technology and automation, according to a US Senate. report released in October.
Appealing these refusals costs more than $7.2 billion in administrative costs for providers each year, according to an analysis of data from the U.S. Centers for Medicare and Medicaid Services.
The agency recently announced new rules to regulate prior authorization of Medicare Advantage plans.
For those looking for details on why a claim was denied, ProPublica has launched a service to help patients submit records requests.
Some patients and companies have developed AI tools to appeal refusals in a “robot battle“.
Companies have launched new generative AI tools to help hospitals And patients writing appeal letters, while a large open-source language model developed by an engineer promises to help patients »Fighting health insurance“.
“Nobody likes the system we had a few years ago — which also used algorithms, just simpler algorithms,” said Michelle Mello, a professor of health policy at Stanford University School of Medicine. . “And now no one likes it with AI involved. But I think improved algorithms can play a constructive role.
AI can help make sure forms are coded and formatted to each insurer’s specifications, she said — ensuring applications aren’t rejected because they’re incomplete. It could also be used by insurance companies to approve insurance applications faster.
Most denials are due to errors in filling out or filing the form, Andrew Witty, CEO of UnitedHealth Group, said last week on an earnings conference call in which executives said UnitedHealthcare’s revenue in 2024 approached $300 billion, with the company expecting that figure to rise to $300 billion. 340 billion dollars in 2025.
Witty estimates that 85% of denied claims could be avoided “through technology and a more standardized approach across the industry”.
It’s especially important to move to an industry standard, instead of each company having different forms and processes, Witty said.
But experts say human oversight of automated processes is a necessary change.
“These algorithms don’t always work correctly, and so I think there is a fear that more of the human aspect is being removed from the system,” said Mika Hamer, assistant professor of policy and management at Health at the University of Maryland School. of Public Health.
California recently passed a law banning AI from making coverage decisions and requiring physician oversight.
But addressing AI alone doesn’t address some of the issues underlying the automation decision, Hamer said — including exorbitant prices for medical care and drugs.
“One in five dollars of U.S. GDP is spent on health care,” Hamer said. “It’s an absolutely massive system. This is going to require a massive overhaul.