There’s more new evidence that some huge, profitable corporate health insurance companies are letting computer algorithms deny important care to real people who need it.
- According to a recent investigation by STAT, the “nation’s largest health insurance company pressured its medical staff to cut off payments for seriously ill patients in lockstep with a computer algorithm’s calculations, denying rehabilitation care for older and disabled Americans as profits soared.”
- According to the report, insurance company employees who let patients keep accessing care for longer than their corporate bosses wanted were at risk of being disciplined or even fired.
It’s yet another example of some corporate health insurance companies putting profits ahead of patients and their bottom lines ahead of people’s lives.
Sadly, it’s nothing new.
Some corporate insurance companies are misusing technologies like AI and automated processing to deny patients’ claims categorically. Meanwhile, they’ve made appealing denials so difficult that, on average, only one in every 500 denials is disputed. Insurance companies count on these low appeal rates to pad their profits.
These tactics are endangering people’s lives.
- Nearly 90% of physicians say they have personally seen burdensome policies from insurance companies, like when insurers require prior authorization, negatively affect patients’ clinical outcomes.
- Nearly 20% said they have seen the insurance company policies cause a life-threatening event.
- And when medical professionals have to jump through hoops and wade through red tape, it diverts health professionals’ time and attention away from caring for people who need help.
These mass denials of coverage aren’t just unfair to patients. They also hurt the hospitals and health systems that patients and communities count on for 24/7 care.
- The cost burden from insurance denials exploded by 67 percent in 2022.
- Half of all hospitals have more than $100 million in outstanding claims that are older than six months.
- One recent study found 40 percent of hospitals report losing more than a half million dollars every year to denied claims.
When insurers deny care, the burden falls on hospitals already facing financial headwinds. Just last week, hospitals in Minnesota explained they have seen “hundreds of millions of dollars in operating losses so far in 2023.” Yet some corporate insurance companies keep piling even more unfair liabilities on struggling hospitals to line their own pockets.
To make things even worse, the huge health insurance companies are also buying up physician practices, potentially injecting their “profit over patients” attitude right into frontline care settings.
- A single corporate insurer now employs approximately 10 percent of all physicians in the U.S., controlling 90,000 employed and affiliated physicians.
- Corporate health insurers have spent billions of dollars acquiring physician practices over the past five years.
- From 2019 to 2023, fully 90 percent of physician acquisitions were made by health insurers, private equity firms and physician medical groups. Only six percent were made by hospitals.
- The largest employer of physicians in all of America is the nation’s largest corporate insurance company.
- Corporate insurers have raised the rates that hospitals pay for services, driving up patient costs.
Policymakers need to stand with patients and the hospitals that care for them, and stand up to the huge insurance corporations that make money by denying claims and buying up practices.
Holding corporate health insurers accountable is an important step towards ensuring Americans get the high-quality health coverage and care they deserve.