ICYMI: At Hearing, Warren Calls Out Medicare Advantage Insurers for Using AI to Deny Care and Boost Profits

Hearing

Alright, Thank you.

So, over 31 million Americans are enrolled in Medicare Advantage, or M-A, the program that allows private, for-profit insurers to offer Medicare coverage. Now, under federal law, these private insurers are required to cover all Medicare Part A and Part B services.

But in recent years, government watchdogs have found that private insurers are routinely delaying and denying care because doing so boosts their profits. In 2019, the Health and Human Services Inspector General found that nearly one in five payment denials by insurers in M-A violated Medicare coverage rules, meaning seniors were unlawfully denied access to services that they were, by law, entitled to.

Some of the largest insurers that offer M-A are now relying on flawed artificial intelligence tools, like predictive algorithms, to scale up their efforts to deny coverage to seniors. These algorithms sift through millions of medical records to determine the level of patient need that the algorithm thinks they need.

So, Professor Mello, you’re an expert on AI and health policy. Let’s start with an easy question: does federal law require all insurance companies to follow Medicare coverage guidelines, even if they are using AI algorithms to determine coverage?

BREAK IN TRANSCRIPT

Yes. So the law is not suspended just because you used AI. I just want to underscore that. Because it is clear that these companies are not playing by the rules.

So, take UnitedHealthcare, which covers more beneficiaries in M-A than any other insurance company. In 2020, UnitedHealthcare bought NaviHealth, a company that sells its AI services to insurance companies in order to help them make these coverage decisions.

Last year, an investigation revealed that UnitedHealthcare had pressured employees to strictly follow NaviHealth’s algorithm’s determinations, leading these human beings to systematically deny care at skilled nursing facilities, even when those decisions were against doctors’ orders.

Dr. Obermeyer, you’ve conducted extensive research on how algorithms are used in health care. Can you talk just a little bit about the dangers that come from solely relying on AI algorithms to make these coverage decisions?

BREAK IN TRANSCRIPT

So it’s a really important point that you make about how it takes the bad information and accelerates it, or the information that tells us about bad practices. You know, according to the, to the , some seniors, these AI denials led to quote “amputations, fast-spreading cancers, and other devastating diagnoses.”

I appreciate that CMS has now finalized a rule to increase transparency requirements on insurers’ AI systems and require doctors to verify coverage decisions – but I think we need a lot more to protect patients here.

So, if I could come back to you, Professor Mello, in addition to the rule that the agency has just finalized, what measures do you think that CMS should take to ensure that private insurers are not leveraging AI tools to unlawfully deny care?

BREAK IN TRANSCRIPT

So, I think the point here is we need guardrails. And without significant guardrails in place, these algorithms, as you put it Dr. Obermeyer, are going to accelerate the problems that we’ve got and pad private insurers’ profits, which gives them even more incentive to use AI in this way.

Until CMS can verify that AI algorithms reliably adhere to Medicare coverage standards, by law, then my view on this is: CMS should prohibit insurance companies from using them in their MA plans for coverage decisions. They’ve got to prove they work before they put them in place.

Thank you, Mr. Chairman.

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