Insurance Companies Utilize Third-Party Firm to Deny Medically Necessary Care
By Consumers for Quality Care, on November 13, 2024
Physicians have long blamed insurance companies – in particular, their prior-authorization policies – for rising health care denials. But an investigative report from ProPublica finds that insurance companies often outsource these medical reviews to a little-known industry that is financially incentivized to turn down doctors’ requests to cover procedures.
EviCore by Evernorth, a company owned by Cigna, is hired by more than 100 insurance companies that collectively cover one of every three insured Americans. The investigation found that EviCore’s algorithm leans towards issuing denials, helping insurers make more money by denying and delaying coverage. According to Barbara McAneny, a former President of the American Medical Association, companies like EviCore decide based on what “is more profitable to them,” adding, “they love to deny things.”
Prior authorization is meant to help insurers control costs, but patient advocates argue that insurers are exploiting it to deny medically necessary care to patients.
EviCore gets business on the promise of increasing profits for insurers by decreasing the number of claims insurers would need to cover. EviCore promised insurance companies a 3-to-1 return on their investment. For every dollar that insurers paid to EviCore, they would save $3 in medical or other costs that they’d normally have to cover. In Arkansas, where denial rates are published, EviCore turned down prior-authorization requests nearly three times more than for consumers with Medicare Advantage plans.
EviCore’s system cannot unilaterally deny a prior authorization request. Those decisions rest with EviCore’s in-house medical experts. But according to former employees, EviCore can change its algorithm at any time to increase the number of claims that need further review. The more cases that need further review, the greater the chance of more claims getting denied. “We could control that,” according to one former employee speaking about EviCore’s algorithm. “That’s the game we would play.” According to former EviCore employees, large health insurers would ask about “controlling the spend” in claims paid out, requesting higher thresholds for approving cases so that more cases would be flagged for review, increasing the chances for denial. EviCore routinely monitors its system to ensure cost savings for insurers to demonstrate value and keep their lucrative contracts with these insurers intact.
EviCore’s size and influence in the health care industry means that its decisions are rarely challenged by doctors or questioned by lawmakers, allowing for very little accountability.
CQC urges both lawmakers to end insurers’ burdensome and troubling practices that delay and prevent consumers from receiving the medical care they need.
