- Imagine having your insurance claim denied
in just 1.2 seconds.
Your life, your future decided in an instant.
Well, welcome to Cigna's World
where an algorithm decides the fate
of hundreds of thousands of claims,
putting profits over people.
And here's the thing,
we already know insurance companies fuck us hard
but I promise you that by the end of this story
you're gonna want some healthcare to remove your foot
from someone's ass.
Right, and that's because Pro Publicate
in the Capitol Forum investigated how one
of the nation's largest insurers, Cigna
decides whether to approve or deny policy claims.
Typically, the way that it's supposed to work is
that claims go into the insurance system, get screened
by a nurse, and then reviewed by a medical director.
And that's because many state laws require doctors to
review each individual claim before insurers reject them
on medical grounds, which means examining patient records,
going over coverage policies
and generally using their professional judgment.
It's meant to be thorough and fair.
Every small low cost claims, the company usually
just pays them out because it's just not worth the time
and money it takes to review them.
But what if you didn't review the claims
and just denied them anyway?
Well, reportedly that's exactly what Cigna's been doing
for over a decade now,
using an algorithm that automatically denies claims
with a mismatch between the diagnosis
and tests or treatments
for the diagnosis that the company considers acceptable.
Then the company's medical directors just sign
off on all the denials in one big batch
deeming them all medically unnecessary,
with one former doctor saying, "We literally click
and submit, it takes all of 10 seconds to do 50 at a time."
So in just two months last year
Cigna doctors rejected over 300,000 claims using this system
and spending an average of just 1.2 seconds on each case.
And this has squeezed fat stacks
out of the company's policy holders
with Dr. Alan Mooney,
the guy who created the system for Cigna,
saying it undoubtedly saved the firm billions of dollars.
And a former executive saying, "Put yourself
in the shoes of the insurer, why not just deny them all
and see which ones come back on appeal?
From a cost perspective, it makes sense."
And adding. "Insurers are very good at knowing when
they can deny a claim and patients will grumble
but will still write a check," which turns out is very true.
In one document, Cigna estimated that only 5%
of people actually appeal a denial from the algorithm.
And while that may sound low and it is low
it's still relatively high for the industry.
With one study finding the patients
under the Affordable Care Act appeal less than 0.2%
of the time, and insurers uphold about 60% of those denials.
And then for those who do appeal, it's a fucking nightmare
as one guy who was insured under Cigna found out,
telling reporters he was experiencing pain in his bones
so his doctor use a blood test to determine
he was vitamin D deficient with that costing $350,
but when Cigna mailed him a letter refusing to cover it
on grounds that it wasn't medically necessary,
he couldn't believe it, saying,
"This was a clinical decision
being second guessed by someone with no knowledge of me."
So being a physician himself, he appeals the denial.
And a second Cigna doctor reviewed the case
but stood by the initial rejection explaining
that because the patient had not been previously diagnosed
with a vitamin D deficiency, the test was unnecessary,
which raises the obvious fucking question,
how is he supposed to have a diagnosis before he got tested
for the thing that he needed the diagnosis of?
And so at that point, he's just baffled
and he takes us to an independent reviewer who, shocker,
after looking at the case, said, "Hey the test
was in fact necessary," but this entire hassle took
over seven months over just a few hundred dollars
and it may not have actually worked out
in his favor at all if the patient himself wasn't a doctor.
Now, in response to all this
Cigna argues that the system actually helps patients
since it enables the company to fast track payments
for approved claims.
One former executive said that doesn't actually
make sense, saying, "They were paying all these claims
before, then they weren't.
You're talking about a system built to deny claims."
Plus the list of treatments and tests that aren't covered
for different diagnoses can be somewhat arbitrary.
In 2014, Cigna made a presentation weighing
the pros and cons of adding other procedure
to the list.
Autonomic nervous system testing.
It can help tell
if a patient suffers from nerve damage caused
by diabetes or a variety of autoimmune diseases
and it only costs a few hundred dollars
which Cigna has been paying
out for every single claim without question.
But by adding the procedure to the list
it would deny almost 18,000 claims and save about two
and a half million dollars per year according to estimates.
So sure enough, those greedy fuck threw it on the list.
But also understand this is a problem that goes way
beyond just Cigna, right?
Health insurers deny millions of claims every year
be it for surgeries, visits to the ER
or lifesaving treatments and prescriptions.
Meanwhile, the six largest private health insurers
in 2021 raked in more than 40 billion in profits.
And insurance executives say systems akin
to the algorithm used
by Cigna have existed throughout the industry
with Mooney saying his group made a similar one
for United Health so it could deny claims in bulk
and claim denials have become an even more pronounced issue
for many people since the pandemic began.
Because right now you have up to 4 million full-time workers
out of the labor force due to long Covid.
And for some the care that they need to
manage their chronic symptoms has forced them
into medical debt often because their claims are denied
by insurance companies who are wary of paying
for treatments that they don't know will work
for an illness that's still poorly understood.
And a paper last year actually estimated
that long Covid could cost an individual $9,000
on average per year.
But these types of denials
aren't the only way that companies are squeezing you dry,
with the New York Times investigation last year
finding that major health insurers boost their profits
by billions of dollars
with the oldest trick in the fucking book.
Fraud.
And at the center
of this scheme is the Medicare Advantage Program,
a private sector alternative
to traditional Medicare where the federal government
pays insurers for each patient who enrolls
with higher payments for sicker patients, right?
As at that time it was on track to enroll more
than half of all Medicare beneficiaries this year.
So the companies devise every method they could
imagine to make patients appear as sick as humanly possible
on paper without providing any more actual treatment.
This includes Kaiser gifting bottles
of champagne or cash bonuses
to doctors who found enough diagnoses in patient records.
Or it could look like Anthem ,now called Elephants Health,
paying more to doctors who said
that their patients were sicker.
Or how about United Health,
the country's largest insurer telling its workers
to mine old medical records for more illnesses
and when they couldn't find enough,
just sending them back to try again.
With shit like this inflating the bills for eight
of the 10 biggest insurers in the program, plus four
of the five biggest to face federal lawsuits for fraud.
So basically, Medicare Advantage was initially
meant to reduce healthcare costs by privatizing the system
and instead prices just shot past those
of the government program that it displaced, right?
Instead of competing to provide the best care,
insurers are competing to see who can better game the system
and the cost of the taxpayers is massive.
The additional diagnoses leading to $12 billion
in over-payments in 2020 alone according to one estimate
or we're talking about an amount of money
that's enough to cover hearing
and vision care for every American over 65.
But ultimately I think where I'm gonna end this story,
two notes.
One, the more we talk
in detail about stories like this, the more
I think maybe Tyler Durden had some good ideas.
And two, if you or someone you know is one
of the unlucky people who are getting letters
denying them coverage, please appeal that bullshit.
They are counting on you not.
And in the meantime
if some fucking smart people can do something
with all the emerging AI to make it just as easy
for the people that are getting fucked
by these companies to fight back with their appeals
and making it easy for more and more people to do so
that would be amazing 'cause these rich greedy fucks
have just for so long been fucking around
and they deserve to find out.
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And then we've also gotta talk about this other
insurance problem.
I know, another one.
15 million Americans are on the brink
of losing their healthcare
and you might actually be one of them.
Yo, this is the largest health insurance disruption
in a decade.
And that 15 million number isn't just speculation.
That is a real projection from the federal government
who also said this will disproportionately affect
young Americans and people of color, right?
According to the Department of Health and Human Services,
of the people who will lose their insurance
more than one third children,
nearly one in every three are Latino and 15% are black.
Well, like so many other protections that have been
rolled back recently for the people that need them the most
this stems from the end of pandemic error protections.
Right before the pandemic, recipients of Medicaid,
which provides health benefits
to Americans with limited income
would have to renew their coverage every year.
And if it was determined that they were no longer eligible
because for instance, they began to make more money
they would lose their coverage.
But in March of 2020
Congress passed the Families First Coronavirus Response Act
which prevented states from removing anyone
from Medicaid during the public health emergency
even if they no longer qualify.
And in exchange for states guaranteeing
that they wouldn't take anyone off the program
the legislation also offered more federal funding
to help pay for the increased enrollment.
And as a result,
Medicaid enrollment skyrocketed over the last few years,
the coverage jumping from around 63 million people
in February of 2020 to 85 million by the end of last year.
We're talking about an increase of more than 30%,
so an absolutely huge expansion in coverage.
And as a result, the policy helped contribute to the rate
of uninsured Americans reaching a record low last year.
But back in December
Congress passed a federal spending bill that set an end date
for the expanded Medicaid protections on March 31st.
So now states have the next 12 months to verify
who's still eligible and who's not in 14 months total
to complete the process
of removing those people from Medicaid, a process
that federal officials have dubbed Medicaid unwinding.
And this is an absolutely massive undertaking.
The scale is unprecedented with federal
and state health officials anticipating that
this is going to be the biggest health insurance disruption
since the Affordable Care Act came
into existence over a decade ago.
Meanwhile, all this is going down is many state
Medicaid agencies are struggling with worker shortages.
And any employees who started
in the last three years have never gone
through the process of conducting renewals.
Beyond that,
there are now 20 million more Americans who have enrolled
in Medicaid since 2020 and have also never dealt
with this process or had to pay attention to notices,
which I mention because they're factors
that could now cost them their coverage.
And experts say that tracking down all the people
on Medicaid will be an incredibly formidable project
for states, right?
I mean, just one of the factors,
a ton of people have moved over over the last three years
and now they risk missing renewal letters.
Stuff's gonna get sent to their old addresses.
Others may have changed their phone numbers
or other contact info, making them harder to track down.
But this resulting
in what health policy experts call administrative churning
which is just when people who are eligible
for Medicaid lose their coverage because
of administrative issues like they got lost
in the confusing bureaucratic renewal process
or the state just couldn't contact them.
And unfortunately, the federal government is predicting
that the administrative churning will be the reason
that many people lose their coverage
in this renewal process.
In fact, according to HHS,
of the 15 million people expected to lose their healthcare,
6.8 million, nearly 50%, will still be eligible
for Medicaid and while those people can re-enroll,
the whole situation is incredibly disruptive, right?
Research has found that although 40%
of people who lose Medicaid regain it within a year,
a majority of the people who get cut off from coverage
go without insurance for at least some period of time.
And experts say that can be incredibly detrimental
for people who have serious
or chronic health conditions and could face serious issues
if they have to go a month or even a week without insurance.
Now, a notable thing here,
the federal government has put some protections in place
to try and ensure the unwinding process operates smoothly.
For instance, states will be required
to make a good faith effort to attempt to contact enrollees
if a renewal notice is returned to the Medicaid office
as undeliverable.
States are also required to report data each month to HHS
and how many people have been removed from Medicaid.
And the department can technically step in
if a state is not following federal requirements.
But then there's also the matter
of the other 8.2 million people who will be removed
from Medicaid because they no longer qualify.
HHS says that almost one third of those folks will qualify
for federally subsidized health insurance plans
on the ACA marketplaces.
And 60% of them will even qualify for free plans.
But the department also unfortunately estimates
that around 383,000
of those people who lose their coverage will fall
into what's known as the coverage gap, right?
And states that have not expanded Medicaid under the ACA
because under Obamacare Medicaid eligibility was
expanded to include all adults whose income is
up to 138% higher than the federal poverty level.
40 states opted into the expansion, but 10 refuse.
And those include Texas and Florida,
two of the most populous states in the country.
And because those states have set the income
requirements so insanely low,
they've created coverage gaps right?
These places where you have people who
are struggling financially
having incomes that are too high for Medicaid
but too low for subsidized Obamacare marketplace plans.
In other words
these people just have no affordable healthcare options.
So we're talking about massive life-changing impacts
on millions and millions of Americans.
And the timeline that we're talking
about here varies a lot state to state
with each state having its own schedule
for how it's conducting Medicaid unwinding.
Five states, Arizona, Arkansas, Idaho, New Hampshire
and South Dakota have already begun the process
where they're moving immediately to kick people
off Medicaid on April 1st, the first day they're allowed to.
And then nearly all other states will begin removing people
between May and July.
And almost half of the states have started preliminary work
for eligibility checks.
In fact, some states began sending
out renewal notices as early as February.
Now a key takeaway here is
if you or someone you know are currently
on Medicaid, experts say that there are a number
of things that you can do to protect your coverage.
First and foremost, make sure
that your address and contact information are up
to date with your state's Medicaid office,
especially if you've changed them in the last few years.
If you've moved recently or haven't notified Medicaid
about an address change, you should definitely
check your previous address filing forms.
And while I know that it is easy to just assume a letter
or an email from your insurance is just a statement
about a claim or benefits.
Make sure that you're keeping an eye
out for Medicaid application materials.
And same goes for calls and texts from unknown numbers.
And if you do lose Medicaid coverage
because you are no longer eligible based on income
or other factors, know that you could still be eligible
for other healthcare programs, including free or cheap plans
through the Obamacare marketplace at healthcare.gov
with HHS even setting up a special enrollment period
so you can transition to a marketplace plan
if you lose Medicaid from March 31st, 2023
through July 31st, 2024.
And that window will be open
for the majority of states, 33 to be exact,
that use healthcare.gov as their insurance marketplace.
And some of the 17 states that manage their own marketplaces
are also allowed to offer the special enrollment period
though notably they are not required to.
So I'll say it, I'll also link it, healthcare.gov
I'm gonna include a link where you can find what marketplace
your state uses and links to apply.
We'll also be linking down
below a really helpful tracker where you can look
at each state's unwinding plans
and other relevant information.
But ultimately that's where I'm gonna end this.
This is one of those stories,
I think it's important
that people are just aware of it in general, but also,
if you're one of the 15 million people that are affected,
you need to know this.
I'm trying to look out for you
'cause the people in fucking charge do not,
at least not universally or oftentimes in general.
But on that happy note, my name's Philip DeFranco,
you've just been filled in.
I love your faces and I'll see you tomorrow.
- ♪ Sexy Phil, ♪
♪ He's not sexy, ♪
♪ Sexy Phil. ♪
♪ He's sexy. ♪