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Has Cigna Recently Denied Your Medically Necessary Claims

  Cigna’s system for denying claims deemed as not medically necessary without medical director review has been investigated and reported by ProPublica. The report features the story of a patient who was denied payment for a blood test, despite it confirming his physician’s diagnosis of a condition that could lead to bone fractures and osteoporosis if […]

Cigna denies medically necessary claims without reviewing patient files

Cigna Claim Denial Lawsuit Lawyers

 

Cigna’s system for denying claims deemed as not medically necessary without medical director review has been investigated and reported by ProPublica. The report features the story of a patient who was denied payment for a blood test, despite it confirming his physician’s diagnosis of a condition that could lead to bone fractures and osteoporosis if untreated in order for Cigna to save millions of dollars.

According to ProPublica’s investigation, Cigna has a system that enables its doctors to instantly reject medical claims without reviewing the patient’s file, resulting in unexpected bills for the patients. The system, known as PXDX, employs algorithms to detect inconsistencies between medical tests/procedures and corresponding diagnoses that Cigna considers appropriate. Cigna’s medical directors then sign off on the rejections in bulk without reviewing the medical records or using their expertise to assess whether a specific patient requires a particular test or procedure. As stated by a former medical director in the report, “We literally click and submit. It takes all of ten seconds to do 50 at a time.” Cigna tracks the number of claims rejected by medical directors every month, and company records reviewed by ProPublica revealed that Cigna medical directors denied over 300,000 payment requests during a two-month period, averaging 1.2 seconds per claim.

One former company doctor and internal documents reveal that Cigna doctors reject patients’ claims without reviewing their files. ProPublica is an investigative newsroom that looks into abuses of power.

When Nick van Terheyden’s doctor suspected a vitamin D deficiency, a blood test confirmed the diagnosis. He expected his insurance plan, managed by Cigna, to cover the $350 cost, but instead, Cigna denied the claim as “not medically necessary.” Cigna’s medical director, Dr. Cheryl Dopke, signed the denial letter, leading van Terheyden, a physician and specialist, to suspect she had not carefully reviewed his case. Cigna’s internal records show that Dopke denied roughly 60,000 claims in one month, making van Terheyden’s experience typical. Cigna has built a system that allows doctors to reject claims on medical grounds without reviewing patient files, leaving many with unexpected bills.

Medical directors are expected to review patient records, coverage policies, and use their medical expertise to approve or deny claims before insurers reject them for medical reasons. Cigna’s review system bypasses these steps, and former employees confirm that the medical directors do not use their medical judgment but instead let a computer do the work. A Cigna algorithm identifies mismatches between diagnoses and the acceptable tests and procedures for those ailments, and doctors sign off on the denials in batches, taking only seconds to do so. Insurance experts question the legality and fairness of such a review system and believe it warrants an investigation.

Some Cigna executives questioned the legality of the speedy denials and whether it satisfied the law. Cigna adopted its review system over a decade ago, and similar systems have existed in various forms throughout the industry, according to insurance executives. Cigna denies the allegations, claiming that their review system accelerates the payment of claims for certain routine screenings and approves claims automatically when submitted with the correct diagnosis codes. However, former Cigna doctors confirmed that the review system was used to reject claims quickly, and an internal corporate spreadsheet lists the total number of denials each medical director handled. Cigna emphasizes that its system does not prevent patients from receiving care but only decides when the insurer won’t pay. The company is committed to improving health outcomes, driving value, and supporting its team of medical directors.

Cigna’s review system was created over a decade ago by Dr. Alan Muney, a former pediatrician who later advised insurers and private equity firms on cost savings. In 2010, Muney helped Cigna identify savings in its operation while managing health insurance for companies owned by Blackstone, a private equity firm. Insurers have the authority to reject care claims, but the process can be expensive. To save costs, Cigna’s review system called “PXDX” automatically denies payment for treatments that don’t match approved lists without medical director review. The system allows for bulk claim denials, saving time and money. Two former Cigna doctors expressed concerns that the system was unfair to patients as it automatically denied claims that lacked vital patient information. State regulators have also questioned Cigna’s PXDX system.

Cigna tracks the number of patient claims processed by its medical directors each month. The directors receive a scorecard that shows how quickly they clear PXDX cases. The system has denied thousands of claims, resulting in significant savings for the company. Cigna estimates that only 5% of patients will appeal a denial resulting from a PXDX review.

Cigna considered adding the autonomic nervous system test to the PXDX list, which detects nerve damage caused by diabetes or autoimmune diseases. The test costs a few hundred dollars per test, and adding it to the list would deny payment for more than 17,800 claims annually, saving the company $2.4 million a year. While acknowledging the potential for negative customer experience and increased out-of-pocket costs, Cigna added the test to the list.

When Dr. van Terheyden received his first denial notice from Cigna, he appealed it. The test Cigna deemed “not medically necessary” confirmed a vitamin D deficiency. Cigna initially denied the claim because van Terheyden lacked sufficient documentation of a vitamin D deficiency. After seven months and external review, Cigna paid van Terheyden’s bill. As a physician, van Terheyden was dismayed by the system and questioned why Cigna would prioritize cost savings over patient care.

Cigna’s review system was not the first of its kind in the industry, but state regulators and former employees have questioned its fairness to patients. Cigna defended its system as unbiased and complete, and the company estimates significant savings resulting from the system’s implementation.

CONTACT PARKER WAICHMAN LLP FOR A FREE CASE REVIEW

If you or a loved one suffered serious harm due to a Cigna insurance claim denial, contact our national Cigna insurance bad faith law firm today for a free case review. You could receive significant monetary compensation for your injuries or for the loss of a loved one caused by a claim denial.

Time is limited, so don’t hesitate to contact our law firm. Call Parker Waichman LLP at 1-800-YOUR-LAWYER (1-800-968-7529) to understand your rights and options. If qualified, our Cigna insurance bad faith attorneys will work hard to obtain the financial compensation you or your loved one deserves.

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