TL;DR
A ProPublica and Capitol Forum investigation uncovers how insurance companies outsource prior authorization decisions to firms like EviCore, which use AI-driven algorithms to deny care and maximize cost savings. This practice impacts millions of Americans, raising concerns about care delays and denials driven by profit motives.
Major health insurance companies in the United States outsource the review of medical claims to companies like EviCore, which use AI-backed algorithms to determine whether treatments are ‘medically necessary.’ This practice has led to increased denial rates, affecting millions of patients and raising concerns about profit-driven decisions in healthcare coverage.
The investigation, conducted by ProPublica and Capitol Forum, found that EviCore, owned by Cigna’s Evernorth, employs an algorithm called ‘the dial’ that can be adjusted to influence approval and denial rates. The company’s contracts with insurers often incentivize reducing healthcare costs, with some boasting a 3-to-1 return on investment.
Internal data shows that EviCore denied nearly 20% of prior authorization requests in Arkansas since 2021, compared to about 7% for Medicare Advantage plans in 2022. The algorithm reviews requests and assigns scores; adjustments to thresholds can increase the likelihood of denials. Medical professionals have criticized these practices, claiming they lead to unnecessary delays and refusals of needed care.
Why It Matters
This practice raises critical questions about the influence of profit motives on healthcare decisions, potentially compromising patient care and delaying essential treatments. It also highlights systemic issues in how insurance companies control healthcare access, with millions affected nationwide.
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Background
Insurance companies often outsource prior authorization reviews to firms like EviCore, which has become a dominant player, covering about 100 million Americans. The use of algorithms to automate and influence approval decisions has been criticized for being rigid and profit-oriented. Past complaints from medical groups describe the company’s guidelines as outdated, leading to frustration and delays in care.
“They love to deny things.”
— Barbara McAneny, former AMA president
“We are improving the quality of health care, the safety of health care and decreasing unnecessary costs.”
— EviCore spokesperson
“We could control that. That’s the game we would play.”
— Former EviCore employee
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What Remains Unclear
It remains unclear how widespread the manipulation of the algorithm is across all contracts and whether regulators will intervene. The full extent of patient harm and the long-term impact of these practices are still being assessed.
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What’s Next
Regulators and lawmakers are likely to scrutinize these practices further, potentially leading to new rules or oversight of prior authorization companies. Industry insiders anticipate ongoing investigations and possible reforms to limit profit-driven denials.
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Key Questions
How do insurance companies decide which treatments to deny?
They outsource the review process to companies like EviCore, which use algorithms and medical guidelines to determine if treatments are ‘medically necessary.’ Adjustments to review thresholds can influence denial rates.
Are these denials justified or are they primarily profit-driven?
While companies claim to focus on safety and cost-effectiveness, internal data and industry reports suggest that profit motives influence denial rates, often leading to delays or refusals of needed care.
What impact does this have on patients?
Patients may experience delays in receiving necessary treatments, increased stress, and financial burdens due to denied or delayed care. Some may be forced to seek appeals or alternative options.
Is regulation changing to address these practices?
Regulators are beginning to scrutinize these practices, but concrete reforms are still in development. The industry remains largely unregulated in how algorithms are used to make denial decisions.
