How AI is letting insurance companies to deny coverage

AI is a new frontier and can be potentially extremely helpful in healthcare. Assembling all known information to solve a problem could benefit many. But there is a dark side to AI, which many have predicted. When it comes to health insurance and denials of care to patients, AI has already triggered a class action lawsuit.

As reported in ALM Benefits Pro, a class action lawsuit has been filed against UnitedHealthcare, one of the largest Medicare Advantage Plan insurers, for using artificial intelligence in an algorithm that wrongfully denied care to many. Quoting from the Introduction in that lawsuit, the plaintiffs allege:

“This putative class action arises from Defendants’ illegal deployment of artificial intelligence (AI) in place of real medical professionals to wrongfully deny elderly patients care owed to them under Medicare Advantage Plans by overriding their treating physicians’ determinations as to medically necessary care based on an AI model that Defendants know has a 90% error rate.”

The plaintiffs also allege that the technology lets the company “aggressively deny coverage, because they know they will not be held accountable for wrongful denials.” Those denied care are typically elderly, according to the complaint, and only a tiny minority will fight back against a wrongful denial.

The problem with appeals
There is nothing new about insurers overriding the patient’s treating doctor’s recommendations for care. With traditional Medicare denials, there is a regulated process for appealing a denial. From personal experience, we know that when an unfair denial of Medicare payment happens and there is an opportunity to present evidence of the patient’s need for the disputed bill for care, there is a reasonable chance of getting payment. The decision is made by an independent hearing officer, not the insurer. With Medicare Advantage plans this process is not so clear and those needing long term care in a nursing home, for example, may not have the wherewithal to go through the appeal process. The class action lawsuit alleges that UnitedHealthcare knows this and uses the algorithm to deny care on purpose. None of these allegations are yet proven. Litigation of the matter will ultimately result in a verdict or a settlement. We can’t yet know how it will turn out. But it is not the first lawsuit ever filed for something done with artificial intelligence.

It is probably inevitable that the risks of the largely unregulated use of AI are steadily coming to light as some originators of this technology have warned. When it comes to harm to our vulnerable elders, the lawsuit is a very disturbing signal that we need regulations over AI in healthcare coverage. The outcome of the class action lawsuit is an unknown. And the fact that the issue is now before the court is known and deserves our attention.

Very heavy promotion of Medicare Advantage plans takes place across media during the open enrollment period between October and early December every year. No one warns the potential customer that one company or another who wants to sell their plan to millions might have invented a scary way to be sure few people get one of the benefits they supposedly offer. Extended care in a rehab facility after hospitalization is one of those benefits. If the plaintiffs are successful in this class action case, the use of AI in development of algorithms to determine whether health care is covered or not will likely change.

Advocating for an elder in rehab
In a real life example, a client at AgingParents.com sought our advice about a discharge plan for her elderly husband who had been hospitalized after a stroke. The facility providing care threatened to discharge the husband on short notice with no ongoing rehab. He needed continued physical therapy and speech therapy, as he was making progress. The facility, being paid by Medicare, wanted to cut off his rehab and deny further care. A fight ensued and the wife had to appeal the denial of continued therapy to Medicare. This wife was well educated, assertive and and quite capable of resisting and appealing the imminent denial. We offered her advice about how to advocate for her husband and she used it. His stay and therapy did continue. But this was an unusual case. The patient’s wife was neither elderly nor frail nor afraid of asserting her husband’s right in the hospital system and Medicare. For many others, as described in the class action lawsuit, there would be no appeal and the elder in need of care would not receive it. All too many elders and their family members are intimidated by the hospital or care facility’s decision to deny care and they do not know what to do. The care they need and want, supported by the doctor’s recommendation, does not happen.

The takeaway:
If you or any elder in your family receiving Medicare is considering changing insurers during open enrollment time, look extremely carefully at how often the insurer denies care and what information they provide about the appeal process for denials of coverage. They should reveal what is involved in the appeal process if you ask about it. You can ask how frequently care authorization from their company is denied and how care denials through them are appealed. You can ask how long appeals normally take. But sales people want to sell their product and may not be able to answer these important questions. Beware if the insurer’s representative does not or can’t answer when you ask about these specifics.

Denials of care happen. They should never be 90% of the time when it comes to extended care issues and overriding the treating doctors’ recommendations about treatment a loved one needs. Take heed from the lawsuit described here. AI can trigger more of same until our legislature figures out how to regulate it across the insurance industry and other sectors in our society. Forbes