How Cigna Saves Thousands and thousands by Having Its Docs Reject Claims With out Studying Them — ProPublica

When a cussed ache in Nick van Terheyden’s bones wouldn’t subside, his physician had a hunch what was unsuitable.

With out sufficient vitamin D within the blood, the physique will pull that important nutrient from the bones. Left untreated, a vitamin D deficiency can result in osteoporosis.

A blood check within the fall of 2021 confirmed the physician’s prognosis, and van Terheyden anticipated his firm’s insurance coverage plan, managed by Cigna, to cowl the price of the bloodwork. As an alternative, Cigna despatched van Terheyden a letter explaining that it will not pay for the $350 check as a result of it was not “medically mandatory.”

The letter was signed by one in all Cigna’s medical administrators, a physician employed by the corporate to assessment insurance coverage claims.

One thing concerning the denial letter didn’t sit nicely with van Terheyden, a 58-year-old Maryland resident. “This was a scientific resolution being second-guessed by somebody with no data of me,” stated van Terheyden, a doctor himself and a specialist who had labored in emergency care in the UK.

The obscure wording made van Terheyden suspect that Dr. Cheryl Dopke, the medical director who signed it, had not taken a lot care together with his case.

Van Terheyden was proper to be suspicious. His declare was simply one in all roughly 60,000 that Dopke denied in a single month final yr, based on inner Cigna data reviewed by ProPublica and The Capitol Discussion board.

The rejection of van Terheyden’s declare was typical for Cigna, one of many nation’s largest insurers. The corporate has constructed a system that permits its docs to immediately reject a declare on medical grounds with out opening the affected person file, leaving folks with surprising payments, based on company paperwork and interviews with former Cigna officers. Over a interval of two months final yr, Cigna docs denied over 300,000 requests for funds utilizing this methodology, spending a mean of 1.2 seconds on every case, the paperwork present. The corporate has reported it covers or administers well being care plans for 18 million people.

Earlier than well being insurers reject claims for medical causes, firm docs should assessment them, based on insurance coverage legal guidelines and rules in lots of states. Medical administrators are anticipated to look at affected person data, assessment protection insurance policies and use their experience to resolve whether or not to approve or deny claims, regulators stated. This course of helps keep away from unfair denials.

However the Cigna assessment system that blocked van Terheyden’s declare bypasses these steps. Medical administrators don’t see any affected person data or put their medical judgment to make use of, stated former firm staff accustomed to the system. As an alternative, a pc does the work. A Cigna algorithm flags mismatches between diagnoses and what the corporate considers acceptable assessments and procedures for these illnesses. Firm docs then log off on the denials in batches, based on interviews with former staff who spoke on situation of anonymity.

“We actually click on and submit,” one former Cigna physician stated. “It takes all of 10 seconds to do 50 at a time.”

Not all claims are processed by means of this assessment system. For these which are, it’s unclear what number of are accredited and what number of are funneled to docs for automated denial.

Insurance coverage consultants questioned Cigna’s assessment system.

Sufferers count on insurers to deal with them pretty and meaningfully assessment every declare, stated Dave Jones, California’s former insurance coverage commissioner. Beneath California regulations, insurers should think about affected person claims utilizing a “thorough, honest and goal investigation.”

“It’s laborious to think about that spending solely seconds to assessment medical data complies with the California regulation,” stated Jones. “At a minimal, I imagine it warrants an investigation.”

Inside Cigna, some executives questioned whether or not rendering such speedy denials glad the regulation, based on one former govt who spoke on situation of anonymity as a result of he nonetheless works with insurers.

“We thought it’d fall right into a authorized grey zone,” stated the previous Cigna official, who helped conceive this system. “We despatched the concept to authorized, and so they despatched it again saying it was OK.”

Cigna adopted its assessment system greater than a decade in the past, however insurance coverage executives say related methods have existed in numerous kinds all through the business.

In a written response, Cigna stated the reporting by ProPublica and The Capitol Discussion board was “biased and incomplete.”

Cigna stated its assessment system was created to “speed up cost of claims for sure routine screenings,” Cigna wrote. “This permits us to routinely approve claims when they’re submitted with right prognosis codes.”

When requested if its assessment course of, often called PXDX, lets Cigna docs reject claims with out inspecting them, the corporate stated that description was “incorrect.” It repeatedly declined to reply additional questions or present further particulars. (ProPublica staff’ medical health insurance is offered by Cigna.)

Former Cigna docs confirmed that the assessment system was used to rapidly reject claims. An inner company spreadsheet, considered by the information organizations, lists names of Cigna’s medical administrators and the variety of circumstances every dealt with in a column headlined “PxDx.” The previous docs stated the figures characterize whole denials. Cigna didn’t reply to detailed questions concerning the numbers.

Cigna’s clarification that its assessment system was designed to approve claims didn’t make sense to at least one former firm govt. “They had been paying all these claims earlier than. Then they weren’t,” stated Ron Howrigon, who now runs an organization that helps non-public docs in disputes with insurance coverage firms. “You’re speaking a couple of system constructed to disclaim claims.”

Cigna emphasised that its system doesn’t stop a affected person from receiving care — it solely decides when the insurer received’t pay. “Critiques happen after the service has been offered to the affected person and doesn’t end in any denials of care,” the assertion stated.

“Our firm is dedicated to enhancing well being outcomes, driving worth for our purchasers and clients, and supporting our group of highly-skilled Medical Administrators,” the corporate stated.

PXDX

Cigna’s assessment system was developed greater than a decade in the past by a former pediatrician.

After leaving his follow, Dr. Alan Muney spent the subsequent a number of many years advising insurers and personal fairness corporations on the right way to wring financial savings out of well being plans.

In 2010, Muney was managing medical health insurance for firms owned by Blackstone, the non-public fairness agency, when Cigna tapped him to assist spot financial savings in its operation, he stated.

Insurers have vast authority to reject claims for care, however processing these denials can value a number of hundred {dollars} every, former executives stated. Usually, claims are entered into the insurance coverage system, screened by a nurse and reviewed by a medical director.

For lower-dollar claims, it was cheaper for Cigna to easily pay the invoice, Muney stated.

“They don’t wish to spend cash to assessment a complete bunch of stuff that prices extra to assessment than it does to simply pay for it,” Muney stated.

Muney and his group had solved the issue as soon as earlier than. At UnitedHealthcare, the place Muney was an govt, he stated his group constructed an identical system to let its docs rapidly deny claims in bulk.

In response to questions, UnitedHealthcare stated it makes use of expertise that permits it to make “quick, environment friendly and streamlined protection choices primarily based on members profit plans and scientific standards in compliance with state and federal legal guidelines.” The corporate didn’t straight deal with whether or not it makes use of a system just like Cigna.

At Cigna, Muney and his group created an inventory of assessments and procedures accredited to be used with sure sicknesses. The system would routinely flip down cost for a remedy that didn’t match one of many situations on the listing. Denials had been then despatched to medical administrators, who would reject these claims with no assessment of the affected person file.

Cigna ultimately designated the listing “PXDX” — company shorthand for procedure-to-diagnosis. The listing saved cash in two methods. It allowed Cigna to start turning down claims that it had as soon as paid. And it made it cheaper to show down claims, as a result of the corporate’s docs by no means needed to open a file or conduct any in-depth assessment. They merely denied the claims in bulk with an digital signature.

“The PXDX stuff just isn’t reviewed by a doc or nurse or something like that,” Muney stated.

The assessment system was designed to stop claims for care that Cigna thought-about unneeded and even dangerous to the affected person, Muney stated. The coverage merely allowed Cigna to cheaply establish claims that it had a proper to disclaim.

Muney stated that it will be an “administrative problem” to require firm docs to manually assessment every declare rejection. And it will imply hiring many extra medical administrators.

“That provides administrative expense to drugs,” he stated. “It’s not environment friendly.”

However two former Cigna docs, who didn’t wish to be recognized by title for concern of breaking confidentiality agreements with Cigna, stated the system was unfair to sufferers. They stated the claims routinely routed for denial lacked such primary data as race and gender.

“It was very irritating,” one physician stated.

Some state regulators questioned Cigna’s PXDX system.

In Maryland, the place van Terheyden lives, state insurance coverage officers stated the PXDX system
as described by a reporter raises “some pink flags.”

The state’s regulation regulating group well being plans bought by employers requires that insurance coverage firm docs be goal and versatile after they sit down to judge every case.

If Cigna medical administrators are “actually rubber-stamping the output of the matching software program with none further assessment, it will be troublesome for the medical director to adjust to these necessities,” the Maryland Insurance coverage Administration wrote in response to questions.

Medicare and Medicaid have a system that routinely prevents improper cost of claims which are wrongly coded. It does not reject payment on medical grounds.

Throughout the world of personal insurance coverage, Muney is definite that the PXDX formulation has boosted the company backside line. “It has undoubtedly saved billions of {dollars},” he stated.

Insurers profit from the financial savings, however everybody stands to realize when well being care prices are lowered and unneeded care is denied, he stated.

Speedy Critiques

Cigna rigorously tracks what number of affected person claims its medical administrators deal with every month. Twelve occasions a yr, medical administrators obtain a scorecard within the type of a spreadsheet that exhibits simply how briskly they’ve cleared PXDX circumstances.

Dopke, the physician who turned down van Terheyden, rejected 121,000 claims within the first two months of 2022, based on the scorecard.

Dr. Richard Capek, one other Cigna medical director, dealt with greater than 80,000 immediate denials in the identical time span, the spreadsheet confirmed.

Dr. Paul Rossi has been a medical director at Cigna for over 30 years. Early final yr, the doctor denied greater than 63,000 PXDX claims in two months.

Rossi, Dopke and Capek didn’t reply to makes an attempt to contact them.

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Howrigon, the previous Cigna govt, stated that though he was not concerned in growing PXDX, he can perceive the economics behind it.

“Put your self within the footwear of the insurer,” Howrigon stated. “Why not simply deny all of them and see which of them come again on enchantment? From a price perspective, it is sensible.”

Cigna is aware of that many sufferers pays such payments somewhat than take care of the effort of interesting a rejection, based on Howrigon and different former staff of the corporate. The PXDX listing is concentrated on assessments and coverings that usually value a number of hundred {dollars} every, stated former Cigna staff.

“Insurers are superb at realizing after they can deny a declare and sufferers will grumble however nonetheless write a examine,” Howrigon stated.

Muney and different former Cigna executives emphasised that the PXDX system does depart room for the affected person and their physician to enchantment a medical director’s resolution to disclaim a declare.

However Cigna doesn’t count on many appeals. In a single company doc, Cigna estimated that solely 5% of individuals would enchantment a denial ensuing from a PXDX assessment.

“A Adverse Buyer Expertise”

In 2014, Cigna thought-about including a brand new process to the PXDX listing to be flagged for automated denials.

Autonomic nervous system testing will help inform if an ailing affected person is affected by nerve harm brought on by diabetes or quite a lot of autoimmune ailments. It’s not a really concerned process — taking about an hour — and it prices a number of hundred {dollars} per check.

The check is flexible and noninvasive, requiring no needles. The affected person goes by means of a handful of checks of coronary heart price, sweat response, equilibrium and different primary physique features.

On the time, Cigna was paying for each declare for the nerve check with out bothering to have a look at the affected person file, based on a corporate presentation. Cigna officers had been weighing the price and advantages of including the process to the listing. “What is occurring now?” the presentation requested. “Pay for all situations with out assessment.”

By including the nerve check to the PXDX listing, Cigna officers estimated, the insurer would flip down greater than 17,800 claims a yr that it had as soon as lined. It could pay for the check for sure situations, however deny cost for others.

These denials would “create a unfavorable buyer expertise” and a “potential for elevated out of pocket prices,” the corporate presentation acknowledged.

However they’d save roughly $2.4 million a yr in medical prices, the presentation stated.

Cigna added the check to the listing.

“It’s Not Good Drugs”

By the point van Terheyden obtained his first denial discover from Cigna early final yr, he had some solutions about his prognosis. The blood check that Cigna had deemed “not medically mandatory” had confirmed a vitamin D deficiency. His physician had been proper, and really useful dietary supplements to spice up van Terheyden’s vitamin stage.

Nonetheless, van Terheyden saved pushing his enchantment with Cigna in a course of that grew extra baffling. First, a unique Cigna physician reviewed the case and stood by the unique denial. The blood check was pointless, Cigna insisted, as a result of van Terheyden had by no means earlier than been discovered to lack enough vitamin D.

“Data didn’t present you had a beforehand documented Vitamin D deficiency,” acknowledged a denial letter issued by Cigna in April. How was van Terheyden presupposed to doc a vitamin D deficiency with no check? The letter was signed by a Cigna medical director named Barry Brenner.

Brenner didn’t reply to requests for remark.

Then, as allowed by his plan, van Terheyden took Cigna’s rejection to an exterior assessment by an impartial reviewer.

In late June — seven months after the blood check — an out of doors physician not working for Cigna reviewed van Terheyden’s medical file and decided the check was justified.

The blood check in query “confirms the prognosis of Vit-D deficiency,” learn the report from MCMC, an organization that gives impartial medical opinions. Cigna ultimately paid van Terheyden’s invoice. “This affected person is susceptible to bone fracture with out correct supplementations,” MCMC’s reviewer wrote. “Testing was medically mandatory and applicable.”

Van Terheyden had identified nothing concerning the vagaries of the PXDX denial system earlier than he obtained the $350 invoice. However he did sense that only a few sufferers pushed as laborious as he had executed in his appeals.

As a doctor, van Terheyden stated, he’s dumbfounded by the corporate’s insurance policies.

“It’s not good drugs. It’s not caring for sufferers. You find yourself asking your self: Why would they do that if their final objective is to look after the affected person?” he stated.

“Intellectually, I can perceive it. As a doctor, I can’t. To me, it feels unsuitable.”