U.S. health insurers accused of using AI to deny care

AI is changing healthcare for good, but sometimes, we spot "not that nice" stories that we need to address.

One such story involves the U.S. health insurer Humana, which has been using an AI algorithm to systematically deny seniors rehabilitation care recommended by their doctors, according to a recently filed class-action lawsuit.

And it's not the case involving the misuse of AI to deny care by a health insurer.

What's the story?

Filed in federal court in Kentucky, the lawsuit claims Humana deployed an AI algorithm in place of medical professionals' judgment "to wrongly deny elderly patients care owed to them under Medicare Advantage plans."

It says the algorithm predicts how much care an elderly patient should need and that employees face discipline or termination if they deviate from strict performance targets. What's more, the suit claims Humana used the algorithm despite knowing it is "highly inaccurate."

This latest lawsuit is part of growing scrutiny around how insurers are using new AI tools to make coverage decisions as regulators race to catch up.

Last month, a similar class-action suit was filed against UnitedHealth Group for its use of the same algorithm, which was created by UnitedHealth subsidiary NaviHealth.

Earlier this year, In June - a lawsuit accused Cigna of wrongdoing tied to the use of its own algorithm to reject claims. According to ProPublica, a Cigna-employed physician used AI tools to deny more than 60,000 claims in a single month.

The context

These class-action lawsuits against health insurers come as Congress and the Biden administration express concern about coverage denials in Medicare Advantage, the popular alternative to the traditional Medicare program.

A bipartisan group of lawmakers has been probing how often seniors who are on Medicare Advantage plans are being denied care compared with those in traditional Medicare.

In November, a Senate panel sent a bipartisan letter questioning some of the biggest Medicare Advantage plans about their policies on coverage denials, including the use of AI-powered algorithms.

House Democrats recently called for stricter oversight from the Centers for Medicare and Medicaid Services on the use of AI algorithms in Medicare Advantage denials.

In January, federal rules will begin restricting how Medicare Advantage plans use predictive algorithms to make some coverage decisions. We don't see it as the end for AI in health insurance; it's just a necessary measure to fix the wrongdoings of some insurers.