Claims Being Denied as Insurance Companies Use AI

The rise of artificial intelligence (AI) and algorithm-based decision-making is now firmly embedded in the insurance industry. Is it, then, a coincidence that the number of claims being denied is also rising, according to policy research organization KKF? 

Many experts say no.

David Lipschultz, an attorney who represents Medicare patients, told CBS News that he believes the increase in claim denials happening in parallel with the growing use of AI is no coincidence. 

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

Insurers claim that AI is just one tool used to help determine whether claims will be covered and that there is always a human element to the decision. However, new lawsuits against UnitedHealthcare and Humana allege that both companies 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 lawsuits. 

The suit against UnitedHealthcare further claims that the insurance company 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.

How To Protect Yourself From Denial of Coverage

Over-reliance on decidedly imperfect AI technology for claims review is just one in a laundry list of barriers erected by insurance companies to delay and deny essential care. Sadly, many of these delays come with irreversible health consequences, including shortened life spans. 

What can David do against these insurance-company Goliaths? Here are some tips on what to do before, during, and after filing a claim with an insurance company:

  • Pick a reputable company: It pays to do a little homework before signing on the dotted line. For starters, make sure to avoid all carriers that have the embarrassing distinction of appearing on The National Law Journal’s 11 worst insurance companies. This is not a guarantee that you will avoid unscrupulous behavior though, as the lawsuit against Humana illustrates. 
  • Read your policy carefully: It’s not the most thrilling way to spend an afternoon, but you absolutely must read your policy from start to finish. Big things to look for? What precisely is covered, and what documents you will need for an appeal if your claim is denied.
  • Double- and triple-check forms: An incorrectly filled-out form can be used by an insurance company to deny or delay claims. Simple errors are also often an excuse to retroactively deny coverage. Be thorough and honest on every form you fill out.
  • Do not cash the check immediately: Insurance companies will send checks with lowball offers or pay premium refunds if they rescind your coverage. Cashing these checks can be legally interpreted as accepting an offer.
  • Get everything in writing: If you need to fight your insurance company, you are very likely to need every related bill, form, and piece of correspondence. Make sure you have both physical and digital file systems set up in advance so you are not scrambling when the time comes. 

If You’re In Over Your Head, Ask For Help 

Don’t feel defeated or guilty if you can’t make progress in getting a claim filed or paid out. The system is designed to bury you in paperwork and leave you bewildered. When it’s not possible to navigate the claims process alone, an experienced lawyer can provide the legal support you need. 

If you have been injured in a traffic accident and you wish to discuss the specifics of your case in a free consultation with an experienced personal injury lawyer, please contact us today.