LAS VEGAS — In an escalating technology arms race, providers are beginning to adopt the same technology they say insurers are using to deny claims in masse — artificial intelligence — to combat claims disputes.
Insurers so far have the upper hand in the race to implement AI into the claims review process, panelists at HLTH said this week. Some of the nation’s largest insurers, including UnitedHealth, Humana and Cigna, already leverage algorithmic decision tools when deciding what care to cover.
This week, nonprofit Blue Shield of California said it will also test claims automation technology early next year, through a partnership with Salesforce. The insurer billed the tool as way to alleviate provider and patient frustration with the prior authorization process, saying it would cut down decision time from weeks or days to seconds.
Payers argue the tools — which have mostly been applied to the prior authorization process— allow them to quickly flag services that do not align with coverage criteria and plan terms.
However, providers’ experience with current tools — supported by investigations and reports from lawmakers — suggest that when AI enters the equation, more claims are denied.
Providence CFO Greg Hoffman told Healthcare Dive that his nonprofit health system noticed underpayments or initial denials increased by more than 50% over a two-year period when payers began to more heavily adopt AI tools to review claims.
The surge forced Providence to increase its number of human “touches per claim” by over 50% because physicians had to submit additional documents, the executive said.
A Senate subcommittee report last week alleged three of the nation’s largest Medicare Advantage insurers — UnitedHealthcare, Humana and CVS — use predictive technology to systematically deny patients access to post-acute care in order to increase their profits.
The largest offender was UnitedHealth, which increased its post-acute services denial rate from 8.7% in 2019 to 22.7% in 2022, alongside the roll out of its predictive tool, NaviHealth-backed nH Predict.
In some sense, payers are forcing an “AI arms race,” said Jeffrey Cribbs, a distinguished vice president analyst on consultancy Gartner’s healthcare team.
“We will see more efficient coding, more efficient submission of authorization claims and then resubmission of claims,” he said. “And then on the other side, we will see more efficient extraction of exceptions and things that might be cause for denial of those claims.”
Providers say they’re currently behind payers in that race — though they’re dedicated to catching up.
During a Monday panel on provider and payers’ use of AI, Sara Vaezy, EVP and chief strategy and digital officer at Providence said providers lag payers in developing large language models, but are likely to have sophisticated options soon.
The executive urged providers to form coalitions to share data and develop standards around AI in the claims process to better compete in the space.
Once providers catch up, experts believe AI could ultimately help them in prior authorizations.
“It’s still early innings, but I think the technology is actually going to go a long way to leveling that playing field, from a provider’s perspective,” said Amit Phull, chief physician experience officer for online networking service Doximity, during the Monday panel.
He said the tech will ultimately offer providers “a leg up” in claims disputes and cut down time it takes to complete claims documentation.
Bill Fera, a principal consultant at Deloitte, agreed.
“Plans have been building for longer. They have the the upper hand right now. Providers are newer to thinking this way and building these tools,” Fera said during an interview. But he said AI will be an equalizer, because it will help providers quickly go through massive amounts of data to find a “truth” about whether the patient ought to qualify for a service under their plan’s terms.
“Policies will now be available to a provider. I wouldn’t go to read a policy in full, but … now we’re surfacing all that knowledge. We’re taking the mystery away,” Fera said. “And there is a fact base. There’s a core piece of information that can be interrogated. It’s just now, it can be interrogated very quickly.”
Still, health systems are contending with payers that are ready to apply AI right now, and many don’t have the AI know-how to build competing models today.
Providence decided to outsource its revenue cycle management to compete in the short-term, Hoffman said. The nonprofit entered a 10-year partnership with R1, a revenue cycle management company, in January, in part to combat rising claims denials associated with payers’ increased use of AI tools.
“As we began to look at our technology roadmap for us to respond quickly and so forth, we realized that it would take us two to three years to build the technology roadmap to be more efficient in this area,” Hoffman said. “And that’s where we’ve now leaned into our partnership with R1 to leverage equivalent technologies.”
