US health insurers accused of using AI to deny claims in bulk

Murder of UnitedHealthcare executive Brian Thompson highlights simmering fury at US system of health care

An unidentified healthcare worker outside the McDonald's restaurant where the Altoona Police Department in Pennsylvania arrested the suspected killer of UnitedHealthcare chief executive Brian ThompsonShow more

Within minutes of UnitedHealthcare’s chief executive Brian Thompson being shot dead in the heart of Manhattan, the internet was flooded with anecdotes of how patients had been denied coverage by their insurers.

Instead of shock at Mr Thompson's killing, a torrent of hate was unleashed on the industry as public anger at the profit-hungry healthcare model in the US has once again been laid bare. A new twist on the decades-long battle over health care are allegations that insurers are using artificial intelligence to deny claims on mass.

Despite spending more than $4 trillion annually on health care – a per capita rate about twice as much as other industrialised nations – the US does not guarantee life-long coverage for all of its citizens and most Americans must turn to the complicated private health insurance market, which has the denial of claims built into its business model.

Much of the fury was aimed at UnitedHealthcare, the insurance giant that provides cover for more than 49 million Americans. It took in $281 billion in premiums last year.

The suspect in Mr Thompson's murder, identified as Luigi Mangione, 26, was arrested in Pennsylvania on Tuesday.

In July, 11 people were arrested after protesters took to the streets outside UnitedHealthcare's headquarters at Minnetonka, Minnesota. Demonstrators accused UnitedHealthcare of operating “a systemic practice of refusing to approve care through prior authorisation denials or pay for care through claim denials".

The company did not help its cause when Andrew Witty, the British chief executive of UnitedHealth, UnitedHealthcare’s parent company, condemned the public response after Mr Thompson's death.

“Our role is a critical role, and we make sure that care is safe, appropriate and is delivered when people need it,” Mr Witty said in a leaked video. “And we guard against the pressures that exist for unsafe care or for unnecessary care to be delivered in a way which makes the whole system too complex and ultimately unsustainable.”

This only increased the public anger. Kaylan, a mother from Texas, published an appeal letter to United after her daughter was denied anti-emetics to help cope with the nausea caused by her chemotherapy drugs.

“Obviously you know better about the side-effects of chemotherapy than me, my peers and the entire scientific community,” she wrote.

Other health insurers are accused of similar behaviour. A woman in Wisconsin faced a $52,000 bill after she was taken to an “out-of-network” hospital after suffering a heart attack, rather than the one in network three blocks further down the road.

A mother was told to spend $6,000 on insulin – money she neither hard nor could raise – because the 90-day supply for her son was spoiled when the family fridge failed.

Matthew Claassen, a veteran insurance broker, was withering in his condemnation.

“Insurance companies have started practising medicine by defining what the medical professional can and cannot do,” he said on X. “They are not saving money for the consumer. They are generating an income for themselves by denying the consumer the care they expect because the insurance company will not pay the medical professional who should make those decisions.”

The centre of Mr Claassen’s complaint is the growing use of artificial intelligence to decide on claims, which should be vetted by medical professionals. In some cases, the handling of claims is outsourced, creating what cynics call a flourishing “dollars for denials” industry.

Cigna, another health insurance giant, which is being sued in California in a class action, rejected 18 per cent of its claims because it was allegedly using an AI algorithm to process claims.

According to the writ, it was this algorithm that enabled the company’s doctors to “automatically deny payments in batches of hundreds or thousands at a time”.

Cigna, which is contesting the case, said it used AI to “help expedite patient reimbursement.”

Another point of contention is insurers questioning treatment on the grounds of medical necessity, Caitlin Donovan of the Patient Advocate Foundation told The National.

“We are seeing an uptick in medical necessity being used to deny a claim,” she said. “What I can tell you is that there's an incredible amount of frustration and a sense of unfairness among the people we talk to, both professionally and anecdotally, because they feel like they're paying for insurance and not receiving it.

“It is becoming harder to navigate, even for our professional case managers. How long it takes us to resolve a case and how long how many different calls we have to make on behalf of our clients has gone up.”

Insurers have even questioned the use of an air ambulance for emergency treatment for a child.

It is not only patients who are unhappy. Hospitals are haggling with insurers and have been holding seminars to explore ways to counteract skyrocketing denials.

President-elect Donald Trump has enlisted TV personality Dr Oz and Robert F Kennedy to shake up American health care. They face a challenge.