When Algorithms Deny Care: The Insurance Industry's AI War Against Patients
The assassination of UnitedHealthcare CEO Brian Thompson in December 2024 laid bare a healthcare crisis where insurance companies use artificial intelligence to systematically deny care while posting record profits. Federal data shows UnitedHealthcare, which covers 49 million Americans, denied nearly one-third of all in-network claims in 2022 - the highest rate among major insurers.
This reflects an industry-wide strategy that insurance scholar Jay Feinman calls "delay, deny, defend" - now supercharged by AI. These systems automatically deny claims, delay payment, and force sick people to defend their right to care through complex appeals. A Commonwealth Fund survey found 45% of working-age adults with insurance faced denied coverage for services they believed should be covered.
The consequences are devastating. As documented cases show, these automated denial systems routinely override physician recommendations for essential care, creating a system where algorithms, not doctors, decide who receives treatment. For those who do appeal, insurers approve at least some form of care about half the time. This creates a perverse incentive structure where insurers can deny claims broadly, knowing most people will not fight back. For the people trapped in this system, the stakes could not be higher - this is quite literally a matter of life and death.
The Rise of AI in Claims Processing
Health insurers have increasingly turned to AI systems to automate claims processing and denials, fundamentally changing how coverage decisions are made. A ProPublica investigation revealed that Cigna's PXDX system allows its doctors to deny claims without reviewing patient files, processing roughly 300,000 denials in just two months. "We literally click and submit. It takes all of 1.2 seconds to do 50 at a time," a former Cigna doctor reported.
The scope of automated denials extends beyond Cigna. UnitedHealth Group's NaviHealth uses an AI tool called "nH Predict" to determine length-of-stay recommendations for people in rehabilitation facilities. According to STAT News, this system generates precise predictions about recovery timelines and discharge dates without accounting for people's individual circumstances or their doctors' medical judgment. While NaviHealth claims its algorithm is merely a "guide" for discharge planning, its marketing materials boast about "significantly reducing costs specific to unnecessary care."
Only about 1% of denied claims are appealed, despite high rates of denials being overturned when challenged. This creates a system where insurers can use AI to broadly deny claims, knowing most people will not contest the decisions. The practice raises serious ethical concerns about algorithmic decision-making in healthcare, especially when such systems prioritize cost savings over medical necessity and doctor recommendations.
Impact on Patient Care
The human cost of AI-driven claim denials reveals a systemic strategy of "delay, deny, defend" that puts profits over patients. STAT News reports the case of Frances Walter, an 85-year-old with a shattered shoulder and pain medication allergies, whose story exemplifies the cruel efficiency of algorithmic denial systems. NaviHealth's algorithm predicted she would recover in 16.6 days, prompting her insurer to cut off payment despite medical notes showing she could not dress herself, use the bathroom independently, or operate a walker. She was forced to spend her life savings and enroll in Medicaid to continue necessary rehabilitation.
Walter's case is not unique. Despite her medical team's objections, UnitedHealthcare terminated her coverage based solely on an algorithm's prediction. Her appeal was denied twice, and when she finally received an administrative hearing, UnitedHealthcare didn't even send a representative - yet the judge still sided with the company. Walter's case reveals how the system is stacked against patients: insurers can deny care with a keystroke, forcing people to navigate a complex appeals process while their health deteriorates.
The fundamental doctor-patient relationship is being undermined as healthcare facilities face increasing pressure to align their treatment recommendations with algorithmic predictions. The Commonwealth Fund found that 60% of people who face denials experience delayed care, with half reporting their health problems worsened while waiting for insurance approval. Behind each statistic are countless stories like Walter's - people suffering while fighting faceless algorithms for their right to medical care.
The AI Arms Race in Healthcare Claims
Healthcare providers are fighting back against automated denials by deploying their own AI tools. New startups like Claimable and FightHealthInsurance.com help patients and providers challenge insurer denials, with Claimable achieving an 85% success rate in overturning denials. Care New England reduced authorization-related denials by 55% using AI assistance.
While these counter-measures show promise, they highlight a perverse reality: healthcare providers must now divert critical resources away from patient care to wage algorithmic warfare against insurance companies. The Mayo Clinic has cut 30 full-time positions and spent $700,000 on AI tools simply to fight denials. As Dr. Robert Wachter of UCSF notes, "You have automatic conflict. Their AI will deny our AI, and we'll go back and forth."
This technological arms race exemplifies how far the American healthcare system has strayed from its purpose. Instead of focusing on patient care, providers must invest millions in AI tools to combat insurers' automated denial systems - resources that could be spent on direct patient care, medical research, or improving healthcare delivery. The emergence of these counter-measures, while potentially helpful for providers and patients seeking care, highlights fundamental flaws in our healthcare system that require policy solutions, not just technological fixes.
AI Bias: Amplifying Healthcare Inequities
The potential for AI systems to perpetuate and intensify existing healthcare disparities is deeply concerning. A comprehensive JAMA Network Open study examining insurance claim denials revealed that at-risk populations experience significantly higher denial rates.
The research found:
Low-income patients had 43% higher odds of claim denials compared to high-income patients
Patients with high school education or less experienced denial rates of 1.79%, versus 1.14% for college-educated patients
Racial and ethnic minorities faced disproportionate denial rates:
Asian patients: 2.72% denial rate
Hispanic patients: 2.44% denial rate
Non-Hispanic Black patients: 2.04% denial rate
Non-Hispanic White patients: 1.13% denial rate
The National Association of Insurance Commissioners (NAIC) Consumer Representatives report warns that AI tools, often trained on historically biased datasets, can "exacerbate existing bias and discrimination, particularly for marginalized and disenfranchised communities."
These systemic biases stem from persistent underrepresentation in clinical research datasets, which means AI algorithms learn and perpetuate historical inequities. The result is a feedback loop where technological "efficiency" becomes a mechanism for deepening healthcare disparities.
Legislative Response and Regulatory Oversight
While California's Physicians Make Decisions Act and new Centers for Medicare & Medicaid Services (CMS) rules represent progress in regulating AI in healthcare claims, the NAIC warns that current oversight remains inadequate. California's law prohibits insurers from using AI algorithms as the sole basis for denying medically necessary claims and establishes strict processing deadlines: five business days for standard cases, 72 hours for urgent cases, and 30 days for retrospective reviews.
At the federal level, CMS now requires Medicare Advantage plans to base coverage decisions on individual circumstances rather than algorithmic predictions. As of January 2024, coverage denials must be reviewed by physicians with relevant expertise, and plans must follow original Medicare coverage criteria. CMS Deputy Administrator Meena Seshamani promises audits and enforcement actions, including civil penalties and enrollment suspensions for non-compliance.
The insurance industry opposes these safeguards. UnitedHealthcare's Medicare CEO Tim Noel argues that restricting "utilization management tools would markedly deviate from Congress' intent." But as the NAIC emphasizes, meaningful transparency requires more than superficial disclosures - insurers must document and justify their AI systems' decision-making criteria, training data, and potential biases. Most critically, human clinicians with relevant expertise must maintain true decision-making authority, not just rubber-stamp algorithmic recommendations.
Recommendations for Action
The NAIC framework provides a roadmap for protecting patients while ensuring appropriate oversight of AI in healthcare claims. Key priorities for federal and state regulators:
Require comprehensive disclosure of AI systems' training data, decision criteria, and known limitations
Mandate documentation of physician recommendation overrides with clinical justification
Implement regular independent audits focused on denial patterns affecting marginalized communities
Establish clear accountability and substantial penalties when AI denials cause patient harm
Create expedited appeal processes for urgent care needs
Healthcare providers should:
Document all cases where AI denials conflict with clinical judgment
Track patient impacts from inappropriate denials, including worsened health outcomes
Report systematic discrimination in algorithmic denials
Support patient appeals with detailed clinical documentation
Share denial pattern data with regulators and policymakers
The solutions cannot rely solely on technological counter-measures. As the NAIC emphasizes, "The time to act is now."
Conclusion
The AI-driven denial of care represents more than a technological problem - it's a fundamental breach of the healthcare system's ethical foundations. By prioritizing algorithmic efficiency over human medical judgment, insurers have transformed life-saving care into a battlefield where profit algorithms determine patient survival.
Meaningful change requires a multi-pronged approach: robust regulatory oversight, technological accountability, and a recommitment to patient-centered care. We cannot allow artificial intelligence to become an instrument of systemic denial, transforming healthcare from a human right into an algorithmic privilege.
Patients, providers, and policymakers must unite to demand transparency, challenge discriminatory systems, and restore the primacy of human medical expertise. The stakes are too high to accept a future where lines of code determine who receives care and who is left behind. Our healthcare system must be rebuilt around a simple, non-negotiable principle: medical decisions should serve patients, not corporate balance sheets.
New CDC Data Shows Progress on STI and Overdose Prevention
New data from the Centers for Disease Control and Prevention (CDC) marks the first significant declines in both sexually transmitted infections (STIs) and drug overdose deaths after nearly two decades of consistent increases. According to CDC's 2023 STI surveillance report, STI rates have decreased by 1.8% from 2022 to 2023, while provisional data through June 2024 indicates a 14.5% decline in national overdose deaths compared to the previous year. These improvements highlight the impact of recent targeted public health interventions, but significant barriers remain, especially in underserved populations and high-burden regions. The incoming Trump Administration's approach to public health funding raises concerns about the stability of these gains, as political shifts can lead to funding uncertainties and program disruptions.
A Closer Look at the STI Data
The CDC's 2023 STI surveillance report reveals encouraging improvements across several key metrics. Gonorrhea cases declined by 7.2%, falling below pre-pandemic levels, and primary and secondary (P&S) syphilis cases decreased by 10.2%, marking the first substantial decline in over two decades. Perhaps most notably, the rate of congenital syphilis increase slowed significantly to 3% compared to previous annual increases of up to 30%.
Despite these positive trends, persistent disparities continue to be a significant concern. Young people aged 15-24 years account for 48.2% of all reported STI cases, although they represent only 25% of the sexually active population. Gay, bisexual, and other men who have sex with men (MSM) remain disproportionately affected, making up 32.7% of all P&S syphilis cases in 2023. Racial and ethnic disparities are also evident, with Black and American Indian/Alaska Native populations experiencing significantly higher rates of all measured STIs compared to other groups.
Geographic disparities further complicate the picture. The South and West regions of the United States report the highest STI rates, with limited testing accessibility and healthcare infrastructure contributing to these regional differences. Targeted prevention measures in high-burden regions will be critical to further reducing these disparities and sustaining progress.
Progress in Overdose Prevention
CDC provisional data through June 2024 indicates a significant decline of 14.5% in national drug overdose deaths compared to the previous year. Forty-five states report decreases in overdose deaths, with North Carolina, Nebraska, and West Virginia showing the most notable reductions of 30%, 23%, and 19%, respectively. However, five Western states continue to report increases, highlighting ongoing geographic disparities in overdose prevention effectiveness.
One of the key factors contributing to these improvements is the expanded access to naloxone, particularly after its approval for over-the-counter use in March 2023. Increased naloxone availability, paired with interventions to reduce solitary drug use, is estimated to have the potential to reduce overdose deaths by up to 37.4%.
Despite this progress, access to overdose prevention services remains inconsistent. Rural areas, especially in the Western United States, face unique challenges due to limited availability of treatment options and prevention tools. This calls for more targeted interventions to bridge the gap between urban and rural areas.
Federal Investments and Policy Shifts
Recent federal funding initiatives signal a strategic shift towards integrated prevention approaches. The Biden Administration's $65.7 million prevention and treatment package, announced in August 2024, emphasizes coordinated responses to overlapping public health challenges, including STIs and substance use disorders. Of this, $27.5 million is specifically allocated for substance use prevention services across states, local governments, and tribal communities.
Additional investments include the U.S. Department of Health & Human Services’ (HHS) Minority HIV/AIDS Fund's $4.8 million support for initiatives targeting doxycycline post-exposure prophylaxis (doxy PEP) and point-of-care testing for HIV and syphilis in 13 jurisdictions. These efforts focus on regions identified as having high unmet needs, aiming to reduce barriers to STI prevention and treatment, particularly for marginalized populations.
However, funding sustainability remains an ongoing challenge, especially with the uncertainty introduced by the changing political landscape and the potential for shifts in federal priorities under the new administration. The 2023 rescission of $400 million in disease intervention specialist funds has forced staff reductions across state health departments, compromising the ability to provide essential contact tracing, partner services, and community outreach. While the Senate Appropriations Committee has proposed a $2 million increase for STI prevention programs, it falls significantly short of offsetting previous cuts, posing a substantial risk to the gains made in recent years.
Barriers to Sustained Progress
Despite progress, systemic barriers threaten the sustainability of current improvements in STI and overdose prevention. Key challenges include limited workforce capacity, geographic disparities in access to care, and medical supply chain issues.
Workforce Capacity and Geographic Barriers
The loss of $400 million in disease intervention specialist funding has significantly impacted state-level prevention efforts, leading to workforce reductions across health departments and limiting their capacity to provide necessary prevention services. The impacts of these workforce reductions are most acutely felt in the South and West regions, where both STI and overdose rates remain highest.
Healthcare delivery infrastructure also presents notable barriers. In rural and underserved communities, access to testing and prevention services remains a critical issue. Without targeted investment in these areas, disparities in healthcare access will persist, undermining the broader public health goals of reducing STI and overdose rates.
Supply Chain Vulnerabilities
Another critical challenge lies in supply chain vulnerabilities, particularly for key medications like Bicillin L-A, which is the only approved treatment for congenital syphilis. Shortages in Bicillin L-A have complicated the treatment of congenital syphilis, which already poses a substantial burden on maternal health services. The 2023 STI surveillance report highlights 3,882 reported congenital syphilis cases, including 279 stillbirths and infant deaths, emphasizing the urgent need for stable access to treatment.
Funding Instability
Funding instability continues to undermine long-term progress. The inconsistent nature of prevention program funding—often reliant on short-term grants—makes it challenging for state health departments to maintain consistent services and infrastructure. Transitioning to sustainable funding models that support long-term planning and implementation is crucial if gains are to be maintained and expanded.
Path Forward: Scaling Effective Models and Sustainable Funding
To build on recent successes in reducing STI and overdose rates, it is essential to strengthen and expand effective prevention models, address healthcare access disparities, and secure sustainable funding sources. Below are recommendations to ensure continued progress:
1. Transition to Sustainable Funding Mechanisms
Federal and state funding for STI and overdose prevention programs must transition from sporadic grants to more reliable, sustained funding streams. The restoration of the $400 million disease intervention specialist funding should be prioritized to rebuild essential workforce capacity. Without a stable financial foundation, health departments will struggle to maintain prevention programs and respond effectively to emerging challenges.
2. Expand Proven Prevention Models Nationally
Programs such as CDC's PS-24-0003, which supports HIV prevention in sexual health clinics, and PS-23-0011, which expands services in high-burden communities, have demonstrated effectiveness in improving health outcomes. Scaling these models to a national level, with an emphasis on high-burden regions, will help ensure that the successes seen in certain areas can be replicated more broadly.
3. Strengthen Healthcare Access in Underserved Areas
Addressing geographic disparities requires focused efforts to expand healthcare access in rural and underserved communities. Efforts should include increasing the availability of rapid testing, supporting mobile health units, strengthening telemedicine infrastructure, and investing in the development of local healthcare workforces. Such measures will help bridge the gaps in access and contribute to reducing the unequal burden of STIs and overdose deaths across regions.
4. Address Supply Chain Issues for Essential Medications
To mitigate the impact of medication shortages, federal policy must prioritize securing stable supply chains for essential treatments like Bicillin L-A. This might include incentives for domestic production or other strategies to ensure a consistent supply of critical medications.
5. Enhance Data Collection and Integration
Modernizing data collection and surveillance systems will enhance the ability to track health outcomes and guide resource allocation. Improved integration between public health and healthcare systems can facilitate more timely and effective responses, reduce duplicative efforts, and enhance the overall efficiency of prevention programs.
Moving Towards Sustainable Progress
Recent data showing reductions in STI and overdose rates demonstrate the positive impact of well-targeted public health interventions. However, sustaining and expanding upon this progress requires systematic policy changes and sustained commitment to prevention infrastructure. Addressing systemic barriers—including funding instability, geographic and racial disparities, workforce limitations, and supply chain challenges—will be crucial to achieving long-term success. By scaling effective programs, ensuring equitable access to healthcare services, and committing to long-term funding, there is potential not only to maintain recent gains but to significantly move towards reducing the incidence of STIs and overdose deaths nationwide.