When an insurance company denies a health claim overruling a doctor, it can be necessarily concluded that either:
1. somehow the company knows more about the patient's condition and the doctor is wrong
2. the doctor is defrauding the system and the insurance company caught the doctor cheating
3. the company is defrauding its clients.
There is no middle ground honestly, and yet "5% of denied in-network claims were turned down because the care was deemed not medically necessary".
This is absolutely crazy and evil. I would expect a few thousand cases annually and probably for million of cases you get denied what you pay for because "we detected your doctor is wrong and we're not paying".
>In fact the single largest category, 36% of denials, was an unexplained "other." A system that rejects tens of millions of claims a year and files more than 1/3 of those rejections under no stated reason is hard for an outsider, or a member, to audit.
I can't even imagine getting lifesaving care denied because of "other". I didn't know things were so grim in the USA and honestly now I'm kinda surprised that more people are not getting "Luigi'd".
There is also “medically reasonable”.
For example getting your teeth cleaned professionally is not medically necessary. But it’s medically reasonable.
I don’t want a health insurance that only does “Medically necessary” things.
- patients who adamantly insist on X treatment, make a fit and threaten a bad review, even though they don't need it
- fear of malpractice suits (e.g. 99.9% chance treatment is unnecessary and a waste of money, but in the 0.1% case I might get sued to oblivion if I didn't prescribe it)
- intense lobbying from pharma companies who spend boatloads of money trying to convince them to prescribe their products
In general, they don't directly pay the costs of using limited healthcare resources, but they can pay serious costs for failing to use them, so their incentives are skewed.
Our current system is far from ideal. But a system where a single person gets to make all the decisions, while foisting all the financial burden on someone else, would collapse within a week. Someone has to be the bad guy to sometimes say "we can't afford this, sorry".
I think the truth is murkier than what you're providing. With the caveat that I am presenting a strong case here that likely isn't what occurs most of the time, consider this:
A person may require long-term therapy after an illness. There are data suggesting that beginning this therapy works better once you attain a certain level of clinical recovery in the hospital. There are also data suggesting that it's better to begin the long-term therapy as early as possible.
Both sets of data are, on their face, credible. There is no obvious reason to always believe one set of data over another. Reasonable people can make reasonable arguments to reasonable listeners for either case. Note that this does not mean that there is not a 'correct' interpretation for any given person's clinical situation!
So what does your insurance company favor? Obviously it will always favor the less expensive option, and there will be no way for them to be convinced otherwise because the underlying question is just not well-determined.
This is literally illegal! Physicians cannot refer patients to entities they own or have an interest in.
What is perverse is that, while we have the Stark Law to constrain physician behavior, we've decided that it's okay if a diffuse group like a non-physician-owned hospital chain enforces rules to this effect.
There has to be a done of exceptions to this.
You see a cardiologist and they recommend a stent. They aren’t going to recommend a different cardiologist does it.
You see a doctor, and they refer you for a test. They have a share portfolio that contains shares in the facility they referred to.
Medicine is riddled with potential conflicts of interest. Managing them is what professionals are supposed to do and what regulators are supposed to enforce.
I don’t live in the US, I’m a n Mew Zealand. Sadly, I am aware of behaviour that looks like corruption in our system.
Things must be different in NZ.
First, it's true that you're going to want to go to who your doctor knows/recommends. The law in the US is just that they can't refer you to a group they own/their spouse owns, or for which they get a financial benefit.
Next, you're speaking about the doctor doing a consult visit before doing a procedure. That is not the same thing as ordering a treatment for you to go get the treatment elsewhere—which describes what happens you go to the pharmacist to get drugs.
Finally, the cardiologist you see in the office is almost certainly not doing stents for you as those are very distinct skillsets (in the US).
We then find that physicians who own a DI practice (or a share in one) refer their patients to diagnostic imaging at rates several standard deviations above other physicians and at rates that are "statistically improbable" when correlated to underlying ICD-10 diagnostic codes.
The point is that they cannot refer you to one of their companies. Of course, there may not be a meaningfully-competitive local market, so patients may end up needing to go to the physician-owned imaging facility. I do not thing this is a large issue for most of the US population though it's probably an issue on a spatial basis.
In this case, two things:
The system decides on the initial denial at most insurers. And when a claims adjuster reviews, the system is presumed to be accurate, and the adjuster has to provide reasoning to overturn the system's denial (this is before the denial has been returned to the provider). It's not "assume the provider was correct", but "we've decided to deny it, give the system reasons why we shouldn't". And that person reviewing it is often an LPN (no shade thrown at LPNs, but they shouldn't be overriding physician decisions, doubly so given an absent history).
How this has affected me personally: I had, for most of my life, a severely deviated septum. I spent most of my life mouth breathing because I could barely pull enough air through my nostrils to make breathing that way not an active effort. I finally went to an ENT who confirmed, sure enough, an approximately ninety per cent deviation. "Great, so lets schedule surgery". ENT: "Slow down. First I have to prescribe you these two nasal sprays so that when you come back in four weeks and report no change, because to both our disappointment, the sprays didn't realign and open up the cartilage in your nose, then I can submit the pre-auth to your insurer and they won't immediately reject it." What a fucking joke.
> "we detected your doctor is wrong"
It's not even that your doctor is wrong, it's "our nurses/expert systems disagree with your doctor so we're not paying".
Healthcare ain't no different. Bureaucracy gonna bureaucracy.
Makes me think of that study a few years ago that found most Americans couldn't afford an unexpected $400 medical bill.
Not to mention the $$$ paid to greedy software engineers for all the mandatory e-health software systems which are all recurring-payment SaaS now raking in crazy amounts of cash.
Do you think your doctor is pocketing all that money? The average do-nothing schlub working in tech is making more than his doctor.
Which really freaks me out. If you're insured at a contract rate of $5000 and they bill $30,000...?
I can't tell if you're being serious. I'm not American but all of my American friends tell me the US healthcare system is an absolute nightmare
My criticism of the analysis is not a defense of US healthcare.
These are, of course, anecdotes, but here some things from my life:
- Next day MRI for my wife after she injured her back at the gym. Had it been more serious she would have been seen the same day.
- Friend's kid was diagnosed with leukemia. They were admitted to the cancer ward the next day, where they stayed for months. The room was large, with a pull out double bed for my friend and his wife to sleep on. The same thing happened with my cousin when she was diagnosed with a brain tumor.
- Our kids were both born at one of the "poor" hospitals in the largest city in our state. We were the only ones on the floor who shared the same last name, and most patients did not speak English. It was excellent. We had our own room (with bathroom, shower, small bed for me to sleep on), great staff, etc.
- Urgent care available 7 days a week at numerous locations within a 5-10 minute drive from my home. Typically a 15-20 minute wait for things like stitches, burns, dislocated fingers, etc.
- Nice pharmacies all over the place, which also provide things like vaccinations. Lots of our medications are now just shipped to our house directly
- The small surgeries I've needed have been done within 2-3 weeks of meeting with my primary care doctor. If they would have been more serious, the timeline would have been significantly shorter, within a day or two. Things like colonoscopies are also available within a number of weeks.
- The hospital system we use has done a really good job embracing technology. The app/website they offer can be used to view all of your test results, message the doctors or nurses, schedule appointments, etc
I had same-day CT for suspected diverticulitis/kidney stones. I had same day x-ray, ultrasound for hyperextension of my wrist (steering wheel airbag going off pushed my hand backwards towards my elbow)... all good. I was told to start PT immediately...
... "we can see you in 8-10 weeks." "We're not accepting new patients". "In 3 months, does that work?"
I've also worked for 14 years as a paramedic and EMT, and seen first hand the sheer number of simple things that become acute care issues requiring the ER that could have been prevented by simple access to a primary care provider.
> Nice pharmacies all over the place, which also provide things like vaccinations. Lots of our medications are now just shipped to our house directly
My insurer will only authorize 90 day prescriptions if you use their wholly owned pharmaceutical subsidiary. Otherwise they will deny anything longer than 30 days for no medical reason. They still charge precisely 3x30 days, but they just want exclusivity with their own vertical integration (which, conveniently, is exempt from laws on insurer profit margins - the only way for an insurer to make more money per capita is if healthcare, including pharma, costs go up).
Not supporting nor opposing the insurance industry, just something I think the public should watch out for and understand.
The ACA tried to make health outcomes a part of the calculation for everyone involved but it is hard to compete with the all mighty dollar.
And insurers use them to minimize the list of procedures they'll accept and pay for around a given ICD-10 code.
> Only about 5% of denied in-network claims were turned down because the care was deemed not medically necessary. The rest were administrative, for an excluded service, for a missing referral or prior authorization, or for a reason the insurer never specified.
I worked in health tech for a while, and I can tell you the muck around a lot with ICD/CPT codes to maximize billing along with other shenanigans. There was actually a project at an innovation center at a well-known medical center which leveraged ML to maximize the amount of codes they could bill for without being rejected. The same kind of thing is often done by physicians who want to juice insurance.
Be mad--very mad--at hospitals and drug cos. As providers, they present themselves as patient advocates, but they're responsible for the outrageous healthcare costs. The dollar amount paid out by US insurance companies is maybe 2x that of other OECD countries, but the healthcare we get back from providers is trash (and extortive) by comparison.
I think this perspective makes sense from someone who works on the insurance side of things.
On the other side, there is no way for the insurance company to acknowledge the clinical severity of a patient except via abstruse ICD code choices that only billing clerks know. So this is a perfect case for an LLM - map normal human words onto ICD claim codes to accurately convey patient severity.
Perhaps someone should also control the moral hazard of the people owning and running this racket getting unnecessary amounts of money, or an unnecessary seat at the table.
[0]: https://galacticbeyond.com/two-percent-programmer/
[1]: https://web.archive.org/web/20260620162923/https://galacticb...
[2]: In both the economic sense, and in the completion-rate sense, because those two things are correlated. And they have been correlated since the 1980s, because a lot of the healthcare industry became de-regulated and more profitable as a result, since at least 1978 (when hospitals were de-forbidden from making profits).
Joe Lieberman realized that he was from a state with massive moneymaking insurance operations. Had nothing to do with Obama streamlining bureaucracy.
I too believed that Joe Lieberman sucked, and sure, he did. However: there's a pattern of parties creating convenient designated villains within the party (usually someone not up for re-election) who can take the blame for doing the thing the party insiders planned to do all along. It's been especially noticeable in the current Congress.
When the designated villain sticks it to us next time, notice how there are zero consequences for them.
Maybe it was the 1.1 million dollars in donations from the healthcare industry to Joe Lieberman.
We may never know.
Frankly Joe should've been furious about how little he received, then:
> Campaign finance: The key players in the crafting of Obamacare were largely dependent upon health industry corporations for election and re-election. Barack Obama received $22.4 million in 2008, and the health sector was his third-most-important source of corporate donors (health industry donations alone were thirty-two times greater than all labor union contributions to Obama). The twenty-three members of the Senate Finance Committee (SFC) received nearly $16 million in 2008 and $20 million in 2010. Since 2003, the Committee’s Chair, Max Baucus, had received $3.4 million, or 23 percent of his total campaign donations; the minority leader, Republican Charles Grassley, had received $2 million. Committee members’ opposition to a “public option” that would compete with private insurers tended to correlate with donations from the health industry over the previous two decades.27 The structure of the electoral process thus guaranteed the presence of health industry loyalists in key Congressional offices.
Source: https://newlaborforum.cuny.edu/2014/10/01/healthy-wealthy-an...
So instead of single payer, everyone got the ACA, and then the blue dog dems lost their jobs anyways.
The Affordable Care Act largely banned that. Insurers can no longer use health status or pre-existing conditions to set rates (via "community rating" and guaranteed issue rules). The result is that everyone effectively pays into a giant, heavily regulated pool. There's a finite amount of money in that pool, so someone has to ration care. That job now falls to the insurance companies, who deny or delay procedures, medications, and treatments.
Health insurers aren't saints — but the core problem is structural. When you remove risk pricing while mandating coverage, adverse selection and cost shifting are inevitable. The ACA patched one serious issue (pre-existing conditions) by breaking the fundamental mechanism that makes insurance sustainable.
We need to be honest about the tradeoffs instead of pretending this is still "insurance."