Lawsuits aim at use of AI tools by health insurance companies to process claims

The health insurance industry’s growing use of artificial intelligence is facing increasing legal challenges, with patients claiming insurers are using the technology to unfairly deny coverage for necessary medical services.

The complaints, which target health insurers United Healthcare and Humana, have raised fears that the integration of AI into the health insurance sector will lead to coverage claims being denied, depriving chronically ill and elderly patients of quality medical care. Will be prevented from receiving. The high number of coverage denials is leading to growing calls for increased government oversight over the health insurance industry’s largely unregulated use of AI, experts told CBS MoneyWatch.

A class-action lawsuit filed Dec. 12 alleges that health insurer Humana unfairly charged medically necessary care for elderly and disabled patients covered under Medicare Advantage — a Medicare-approved plan run by private insurers. Used an AI model called NHPredict for denial. Another lawsuit filed last month also accuses UnitedHealthcare nHPredict used to refute claimsNearly 90% of the devices denied coverage despite knowing that the devices were defective, beyond the patient physicians’ determination that the expenses were medically necessary.

A spokesperson for Humana said the company “uses a variety of tools, including augmented intelligence, to expedite and approve utilization management requests,” and “keeps the ‘human in the loop’ in decision making whenever AI is used.” ” The spokeswoman said Humana does not comment on pending litigation.

UnitedHealthcare did not respond to CBS MoneyWatch’s request for comment.

Use of AI by Humana, United Healthcare

NHPredicts is a computer program created by NaviHealth, a subsidiary of United HeathCare, that develops personalized care recommendations for sick or injured patients, based on “real-world experience, data and analysis,” according to its website. Which notes that this tool “is not to be used to deny care or make coverage determinations.”

But a recent lawsuit is challenging that last claim, alleging that “the NH Predict AI model sets coverage criteria for Medicare Advantage patients in acute care settings with rigid and unrealistic predictions for recovery.” Both United Healthcare and Humana are being accused of setting policies to ensure that coverage determinations are made based on the output of NHPredicts’ algorithmic decision making.

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One lawsuit says Humana “employees who deviated from NH Predict AI model estimates were disciplined and terminated, regardless of whether the patient needed more care.”

Similarly, UnitedHealthcare “disciplined and terminated” employees who deviated from NH PREDICT guidelines, even if the patient required it.[d] More care,” according to a lawsuit against the insurer.

NavyHealth did not respond to CBS MoneyWatch’s request for comment.

Increase in claim rejections

David Lipschutz, an attorney who advocates for Medicare patients, said he has seen insurance claims denied “more frequently” and “unreasonably” this year. He said these changes coincide with the adoption of AI by health insurance companies to determine coverage for Medicare patients.

“In our experience, the use of these algorithmic tools has led to more denials or premature termination of coverage for things that otherwise should have been covered,” Lipschutz said.

According to KKF, in 2021, insurers rejected almost one in five claims they received, which is higher than several years ago.

Still, it’s impossible to know whether insurers’ AI tools are directly responsible for the increase in claim denials, according to Lipschutz. That said, since insurance companies are not legally required to disclose the reasons behind their coverage decisions, there is little publicly available data on insurers’ claims review processes, making it difficult to determine whether. What is the reason behind the refusal?

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Cindy Cardinal, a retired North Carolina woman who cares for her octogenarian father, has spent more than a year trying to deny various claims from UnitedHealthcare, the insurance company that offered her father’s Medicare Advantage plan. .

The first feud began when Cardinal’s father broke his hip, forcing him to undergo emergency hip-replacement surgery. After the operation, a doctor recommended that he be admitted to an intensive inpatient rehabilitation program to help him regain his mobility.

The program will cost $1,800 per day – the same cost as the average mortgage payment in the state of North Carolina.

Cardinal said the answer to his father’s claim came within minutes: UnitedHealthcare would not pay the bill.

The insurer did not provide any information about how it decided it would not cover the care ordered by her father’s physician, she said.

Lipschutz said the litigation against UnitedHealthcare and Humana could accelerate efforts to regulate the application of AI technology within the health insurance industry, even if the current fight may not be resolved for several years.

“Through litigation, law and the court of public opinion… [there’s] Hopefully such unfair practices will reduce,” he said.

Last week, Cardinal’s father moved into his house. She said she has recently been struggling to get coverage for her father’s physical therapy sessions, sometimes spending hours on the phone with United Healthcare. Her father’s doctor has also recommended palliative care for now. The Cardinals are expected to struggle in coverage for this one as well.

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