{"id":6566,"date":"2025-01-03T19:54:42","date_gmt":"2025-01-03T19:54:42","guid":{"rendered":"https:\/\/africanamericanvoice.net\/?p=6566"},"modified":"2025-01-05T20:00:07","modified_gmt":"2025-01-05T20:00:07","slug":"as-ai-denied-health-insurance-claims-rise-so-does-nationwide-frustration","status":"publish","type":"post","link":"https:\/\/africanamericanvoice.net\/?p=6566","title":{"rendered":"As AI-Denied Health Insurance Claims Rise, So Does Nationwide Frustration"},"content":{"rendered":"
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By <\/span>Selen Ozturk<\/a><\/div>\n<\/div>\n<\/div>\n
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The killing of UnitedHealthcare CEO Brian Thompson sparked a national debate over rising health care costs and claim denials.<\/p>\n

AI is used to deny millions of health insurance claims today, while\u00a0two-thirds<\/a>\u00a0of health care organizations plan to increase AI spending in the next three years.<\/p>\n

The health insurance landscape and AI<\/h2>\n

\u201cHealth insurance is often the most dysfunctional, fragile and poorly functioning example of the fraught relationship between policy holders and insurers across the insurance industry,\u201d said Dr. Katherine Hempstead, senior policy officer at the Robert Wood Johnson Foundation, at a Friday, December 20 Ethnic Media Services briefing on AI-denied health insurance claims.<\/p>\n

\u201cIn health insurance, we have a few things that increase that mistrust,\u201d she continued. \u201cAs opposed to a one-time claim, like in life insurance, you have ongoing contact between insurers and policy holders \u2014 often when people are ill or feel like their future health is at stake \u2026 There\u2019s a fundamental powerlessness for policyholders when providers say something is necessary, but insurers say it\u2019s not \u2026 and there\u2019s a tremendous amount of fragmentation as to what\u2019s covered between states or between plans.\u201d<\/p>\n

A November 2024\u00a0Gallup poll<\/a>\u00a0found that Americans\u2019 rating of U.S. health care is at its lowest since 2001, with 44% saying the quality is excellent or good and 28% saying the coverage is excellent or good.<\/p>\n

Why are Americans growing increasingly dissatisfied with this system now?<\/p>\n

\u201cOne reason, ironically, is that more people are covered under managed care and Medicare Advantage plans \u2013 which is a great thing, but it\u2019s one of the environments where issues around denied claims for services and often life-changing medications \u2014 like\u00a0GLP drugs<\/a>\u00a0for diabetes and obesity \u2014 are coming to a head,\u201d Hempstead said.<\/p>\n

Medicare Advantage (MA) is a Medicare-approved private health plan, covering seniors and people with disabilities.<\/p>\n

An October 2024\u00a0report<\/a>\u00a0released by the U.S. Senate found that the three largest MA companies \u2014 UnitedHealthcare, Humana and CVS, together covering 60% of enrollees \u2014 drastically increased algorithm-automated claim denials between 2019 and 2022 and systematically limited post-acute (PA) care, including home health services and long-term hospital care, to maximize profits.<\/p>\n

UnitedHealthcare\u2019s PA denial rate rose from 10.9% in 2020 to 22.7% in 2022 as the company ramped up automation; Humana\u2019s PA denial rate was 16 times higher than its overall denials; and CVS\u2019 PA denials were unchanged even as PA requests surged by 57.5%.<\/p>\n

\u201cWhen people appeal, and especially when the press is involved, many times the decision changes, which can drive a lot of cynicism on the part of people who feel rightly that insurers will try to get away with denying services until they\u2019re exposed or pressured,\u201d explained Hampstead. \u201cThat drives inequity by disadvantaging people who don\u2019t speak English as their first language, or are lower-income or less-educated, and so are less likely to dispute a decision.\u201d<\/p>\n

At the heart of increasing claim denials is the use of prior authorization, the process requiring insurance approval before a patient can get a service or prescription.<\/p>\n

\u201cWe have tools like prior authorization and automation to try to expedite delays, curb over-prescriptions and impose guardrails on health care spending, which is very high in the U.S.,\u201d said Dr. Miranda Yaver, assistant professor of health policy and management at the University of Pittsburgh. \u201cBut errors are one thing in a low-stake setting, and quite another in health care. We\u2019re spending a lot on health care that isn\u2019t care at all but administration.\u201d<\/p>\n

Nearly $1 out of every $5 spent in the U.S. is\u00a0spent<\/a>\u00a0on health care, which represents 17% of the national GDP; in 1960, it represented 5%, or 1$ out of every $20.<\/p>\n

Meanwhile, 30 cents on every medical dollar spent \u2014 roughly $750 billion annually \u2014 goes to administrative costs.<\/p>\n

Although U.S. health care spending has skyrocketed, so have out-of-pocket costs spent by all Americans, with health insurance or not, on health care not paid for by a plan.<\/p>\n

These costs have soared from $115 in 1970 (adjusted for 2024 inflation, $677) to $1,425 per person in 2022, not including money spent on monthly health insurance premiums.<\/p>\n

For her book \u201cCoverage Denied: How Health Insurers Drive Inequality in the United States,\u201d upcoming in 2026, Yaver surveyed 1,340 adults nationwide and found 36% experienced at least one claim denial, with 60% of these facing multiple.<\/p>\n

\u201cNo matter who you are, you\u2019re vulnerable to this, but the effects can cause the most inequities for people from marginalized groups less likely to realize they can appeal,\u201d she said. Even when people are successful in appealing these automated denials, we need to think about the equity costs \u2026 It\u2019s time-consuming, physically and emotionally taxing, and can be expensive.\u201d<\/p>\n

Limiting AI<\/h2>\n

\u201cIt\u2019s unfortunate that we\u2019re pretty much the only industrialized country that operates in this way,\u201d said California State Senator Josh Becker, author of the Physicians Make Decisions Act (SB 1120<\/a>) limiting the scope of AI by requiring doctors to make final decisions on what treatment patients receive, and to oversee decisions made by AI like claim requests and prior authorization.<\/p>\n

The bill was signed by Governor Newsom last September and takes effect January 5, 2025.<\/p>\n

\u201cWe need the human element to ensure that health care decisions prioritize patient well-being over automated processes,\u201d he explained, adding that his bill \u2014 which faced general opposition by insurance companies and support by physicians\u2019 groups including the California Medical Association \u2014 \u201cflew a bit under the radar. There wasn\u2019t as much public attention on the issue as there is now \u2026 but we\u2019ve already had other states contact us, and had the federal government and some members of Congress reach out as well. We\u2019re hoping that this is another example where people will follow California\u2019s lead.\u201d<\/p>\n

\u201cThere will be important roles for AI in detecting disease or reading images, but we\u2019re talking about ensuring appropriate health care decisions that only trained physicians can make, and this holds significant risks,\u201d Becker continued.<\/p>\n

In 2023, for example, Cigna Healthcare faced a California lawsuit on the grounds that the company used AI algorithms to refuse over 300,000 pre-approved claims over two months in the previous year, with an alleged 1.2 seconds spent to reject each claim and 80% of customer-appealed claims being overturned.<\/p>\n

Cigna covers or administers health plans for\u00a018 million<\/a>\u00a0Americans.<\/p>\n

The suit alleged that a single Cigna medical director, Cheryl Dopke, rejected roughly 60,000 claims in one month.<\/p>\n

That same year, in 2023, for-profit health insurance companies made $70.7 billion in profits \u2014 \u201cmaybe due in part to practices like these denials,\u201d said Becker. \u201cEvidently, they\u2019re doing a pretty good job of cost containment.\u201d<\/p>\n

\u201cIf you\u2019re denying claims every 1.2 seconds, you\u2019re not really looking at what patients need,\u201d he added. \u201cWe just shouldn\u2019t have to spend so much of our health care dollars negotiating these claims. Let\u2019s focus more money on care for patients who need it.\u201d<\/p>\n

Source: Published without changes from Ethnic Media Services<\/p>\n<\/div>\n

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