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When Megan Rothbauer experienced a heart attack while at work in Wisconsin, she was promptly transported to the nearest hospital via ambulance.
Due to the seriousness of her condition—Rothbauer was placed in a medically induced coma for ten days—the closest medical facility was chosen for her immediate care.
This decision resulted in unexpected financial burden.
Unfortunately for Rothbauer, the hospital she was taken to was outside her health insurance network, leading to a staggering bill of $52,531.92 for her treatment.
If the ambulance had traveled just three additional blocks to Meriter Hospital in Madison, she would have faced only a $1,500 bill.
Rothbauer expressed her frustration, noting, “I was in a coma. I couldn’t very well wake up and say, ‘Hey, take me to the next hospital’.”
She felt no fault lay with the ambulance service: “It was the closest hospital to where I had my event, so naturally the ambulance took me there.”
Ms Rothbauer was in a coma for ten days
Although the hospital later reduced her bill by 90 percent, this incident highlighted the intricate and costly nature of the U.S. healthcare system. Many patients discover that, despite paying substantial premiums, they may find themselves uncovered due to the fine print in their policies.
In numerous situations, insurance companies deny coverage based on subjective determinations of whether treatments are necessary, a decision increasingly influenced by artificial intelligence systems rather than direct medical professionals.
This trend has contributed to a sharp increase in coverage denials. Major players, such as EviCore, are responsible for reviewing claims for approximately 100 million individuals, often utilizing AI to assess doctors’ requests for prior authorization.
ProPublica indicates that this reliance on technology has led to a culture where coverage is denied on a large scale, with criticism labeling it a “dollars for denial” system, where some contracts incentivize reducing spending.
The serious implications of these widespread coverage denials were starkly illustrated by the assassination of Brian Thompson, UnitedHealthcare’s CEO, in Manhattan.
While the motives behind the incident remain unclear, witnesses noted that shell casings left at the scene bore words like “deny,” “defend,” and “depose,” which many interpreted as symbolic of the tactics used in the insurance sector to evade payment.
Data from ValuePenguin revealed UnitedHealthcare rejected approximately one in three claims last year, a rate significantly above the industry average.
‘Illegal scheme’
In a similar vein, Cigna, the fourth-largest health insurer in the U.S., was reported to have denied 18 percent of its claims and is currently facing a class action lawsuit in California over its widespread denial practices.
The lawsuit alleges that Cigna has engaged in an “illegal scheme” to consistently and unjustly deny its clients the thorough, individualized reviews mandated by California law, as well as the reimbursements for necessary medical services outlined in their insurance policies.
Cigna responded by asserting that the allegations in the lawsuit are unsubstantiated and largely rooted in a mischaracterized article.
They further clarified, “Cigna utilizes technology to confirm that coding on routine, low-cost procedures is accurately submitted according to our publicly accessible coverage policies to expedite the process of reimbursement for physicians.”
They emphasized that these reviews occur post-treatment, ensuring there are no denials of necessary care, and that they provide guidance for correcting and resubmitting denied claims.
Insurers frequently reject claims on the grounds of unnecessary treatment despite a physician’s recommendation.
Furthermore, the class action asserts that many medical reviews were conducted by algorithms instead of practicing physicians.
Algorithm used to deny claims
At the center of this controversy lies PXDX, an algorithm created by Cigna enabling its doctors to “automatically deny payments en masse.”
This system allegedly allowed for rejections without properly examining individual files, leaving many patients unexpectedly burdened with medical costs.
In just two months in 2022, it was claimed that Cigna’s doctors denied over 300,000 payment requests, with each request reviewed in about 1.2 seconds.
Cigna was accused of promoting this system knowing that around 98 percent of rejected claims would go unchallenged.
Glenn Danas from Clarkson Law Firm, which represents the affected patients, remarked on the growing trend of insurers utilizing AI to cut costs, stating, “Our position is not that AI has no role in the insurance sector, but it must be implemented responsibly and should not replace the professional judgment of physicians.”
The financial motives for employing AI are significant, offering not only reduced payouts but also substantial savings on workforce costs.
Danas pointed out that considerable savings also arise from claimants who choose not to pursue their claims further.
Another prominent insurer, Anthem, faced backlash due to plans to limit reimbursements for anesthetics used during surgeries.
It intended to halt payments for anesthetic services that exceeded a specific time threshold, regardless of the procedures still in progress.
‘Appalling behaviour’
In response, an outraged anesthesiologist raised concerns about stopping treatment mid-operation or leaving patients with overwhelming medical bills.
Donald Arnold, president of the American Society of Anesthesiologists, criticized this practice, stating, “This is just the latest in a long line of appalling behaviour by commercial health insurers looking to enhance profits at the expense of patients and the medical professionals dedicated to providing essential care.”
Eventually, Anthem reversed its decision, acknowledging that miscommunication contributed to confusion regarding the policy change.
KFF, a nonprofit health policy organization, reported that around 60 percent of Americans encountered issues when attempting to utilize their insurance.
These issues often included claim denials, significant delays in pre-authorizing treatments, or finding that their healthcare providers were not adequately covered within their networks.
The groups most affected were those receiving insurance through their employers or via health plans established under the Affordable Care Act.
Outreach to Cigna, Anthem, EviCore, and AHIP, the health insurance trade association, has not yet yielded responses.
Source
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