Insurers Come Under Fire for Using AI to Deny Claims

Health insurance companies, often criticized for high costs and refusal to cover physician-mandated treatments, now have a new trick up their sleeve.

Many insurance providers are using Artificial Intelligence (AI) technology to determine whether medical costs are eligible for coverage. Some insurers have come under fire for using AI to deny medical care to elderly and disabled patients. 

One new lawsuit claims that the insurance company UnitedHealthcare illegally denied “elderly patients care owed to them under Medicare Advantage Plans” by deploying an AI model known by the company to have a 90% error rate. These determinations went against the physician’s decision that the care denied was medically necessary.

Perhaps even more alarming, both UnitedHealthcare and Humana have allegedly disciplined and fired employees who approved services found to be ineligible for coverage by the AI-based algorithm. This holds true “regardless of whether a patient require[d] more care,” according to the lawsuit.

Using AI to lower administrative costs (and presumably pass these savings onto consumers) is one thing. But punishing employees for disagreeing with a recently launched AI model over coverage of essential services sounds like the stuff of science fiction. If only it were.

Same As It Ever Was: Insurance Companies Will Do Anything to Save a Buck   

AI is just the latest in a long history of unscrupulous tactics insurance companies use to avoid paying claims. An estimated 1 in 7 claims for treatment are rejected, according to state and federal regulators.

What other tricks do they use? Read on for three of the most common ways experts say insurance companies try to sidestep insurance payouts.

  • Deny, Deny, Deny Claims

Insurance companies will outright deny that an accident occurred or that the policyholder was seriously injured. Some companies even offer gifts and bonuses to employees who deny claims and keep payments to a minimum. Arbitrary rules will crop up, often referencing provisions that do not exist or that contradict a previous statement. The hope is that denial after denial will defeat and deflate claimants, making them feel they have no choice but to throw in the towel.

  • Delay Paying as Long as Possible … Even Until Death

Delaying payment is another common tactic used to boost profits. Insurance companies are known to send out incorrect forms and then blame claimants for the error or set short time limits on when a claim can be filed after an accident, injury, or illness. In cases involving elderly or gravely ill claimants, some insurance companies have even delayed payments in hopes that the customer dies before they have to pay.

  • Defend in Court

Following a denied claim or a delayed payment, insurance companies know they can further delay writing a check by defending their questionable tactics in court. Billions of dollars in profits and thousands of high-priced lawyers on the payroll mean they are always ready for a trial. Insurance companies know many customers may be afraid or unwilling to hire a lawyer. They use that fear to convince claimants that a court battle would only end in an insurance company victory.

Do You Suspect Your Health Insurance Claim Was Denied Unfairly?  

An experienced lawyer can guide you through your claims process and provide the legal support you need to challenge your insurance company in court. If you wish to discuss the specifics of your case in a free consultation with an experienced Tucson-based attorney, please contact us today.