Cigna executives caught in “legally gray” cash grab

The fight over Obamacare was probably the first time I really came face to face with the corruption and dysfunction of our government, when it came to domestic policy. The Republicans, of course, had launched the scorched-earth obstructionism that has become their default when out of power, and Obama seemed to be looking for excuses to make concessions. Single-payer healthcare was taken off the table before negotiations even began, but of course that didn’t stop the GOP for ranting about how Obama was a Muslim socialist who would set up “death panels” to kill your grandparents (the GOP base). It’s ironic, but not surprising that in the years since, we’ve literally seen Republicans calling for senior citizens to die “for the economy”. Remember, kids, every conservative accusation is actually a confession.

It was Obama’s unwillingness to actually fight for a good healthcare system that really infuriated me. After it became obvious that taking single payer off the table won him zero credit or respect, he should have started playing hardball for a public option, as something to give up for a conservative concession if nothing else, but he refused to do that either. It was the same pattern we see today – the Democratic president says he wants to do something, but the right-wing members of his party have sided with the GOP, and won’t allow it, so there’s just nothing to be done. Seeing that same pattern play out again and again, even with a veteran politician like Biden, is part of why I’ve become convinced that the leadership of the Democratic Party has never intended to follow through on its promises to the left.

Even so, the fact remains that the Affordable Care Act really is an improvement over what came before. If you want an overview of that delightful arrangement, check out Michael Moore’s 2017 documentary Sicko. The problem is, while the ACA put limits on the ways that health insurers could scam their customers, it did not come close to solving the inherent problem of for-profit health insurance – it’s a parasitic middleman of an industry, whose profit comes from refusing to pay for healthcare.

Probably the nicest thing about leaving the United States was no longer having to deal with that country’s healthcare “system”. For all the improvements made under Obama, it’s still overpriced, and still riddled with traps and loopholes that force people to pay out of pocket for their own care, despite spending hundreds or thousands per month for insurance to avoid precisely that. The paperwork was also hell, whereas the “terrifying bureaucracy” of the NHS actually took pretty good care of me for a much lower price, with a fraction of the paperwork. Here in Ireland, I have to have private insurance, but because there’s a public system, the cost is a lot lower than anything in the US, for better hospital coverage, and, if I’m willing to wait, I can also get treatment etc. from the public system. It’s not perfect, but it’s so, so much better than what the US has, and I don’t really have to deal with things like surprise bills. Unfortunately, corporations back home are continuing with business as usual, and have been denying coverage for hundreds of thousands of people for basically no reason other than pure greed:

When a stubborn pain in Nick van Terheyden’s bones would not subside, his doctor had a hunch what was wrong.

Without enough vitamin D in the blood, the body will pull that vital nutrient from the bones. Left untreated, a vitamin D deficiency can lead to osteoporosis.

A blood test in the fall of 2021 confirmed the doctor’s diagnosis, and van Terheyden expected his company’s insurance plan, managed by Cigna, to cover the cost of the bloodwork. Instead, Cigna sent van Terheyden a letter explaining that it would not pay for the $350 test because it was not “medically necessary.”

The letter was signed by one of Cigna’s medical directors, a doctor employed by the company to review insurance claims.

Something about the denial letter did not sit well with van Terheyden, a 58-year-old Maryland resident. “This was a clinical decision being second-guessed by someone with no knowledge of me,” said van Terheyden, a physician himself and a specialist who had worked in emergency care in the United Kingdom.

The vague wording made van Terheyden suspect that Dr. Cheryl Dopke, the medical director who signed it, had not taken much care with his case.

Van Terheyden was right to be suspicious. His claim was just one of roughly 60,000 that Dopke denied in a single month last year, according to internal Cigna records reviewed by ProPublica and The Capitol Forum.

The rejection of van Terheyden’s claim was typical for Cigna, one of the country’s largest insurers. The company has built a system that allows its doctors to instantly reject a claim on medical grounds without opening the patient file, leaving people with unexpected bills, according to corporate documents and interviews with former Cigna officials. Over a period of two months last year, Cigna doctors denied over 300,000 requests for payments using this method, spending an average of 1.2 seconds on each case, the documents show. The company has reported it covers or administers health care plans for 18 million people.

I don’t know the exact demographics of my readers, but I think it’s reasonable to assume that most of you know from experience what it’s like to be poor enough that an unexpected $300 bill is a nightmare. Cigna argues that they’re in the clear, morally speaking, because nobody was denied a service, but for a lot of people, forcing them to pay for that service, when they’re already paying you premiums every month, means they can’t afford something else that they needed. Or they just… don’t pay, and instead get harassed over it for years to come. If you think this “review” system seems illegal, you’re right – it does seem illegal. Cigna executives decided it was a legal grey zone, and their lawyers agreed, so they decided to grab the money (from their customers), and see if they could get away with it.

Within Cigna, some executives questioned whether rendering such speedy denials satisfied the law, according to one former executive who spoke on condition of anonymity because he still works with insurers.

“We thought it might fall into a legal gray zone,” said the former Cigna official, who helped conceive the program. “We sent the idea to legal, and they sent it back saying it was OK.”

Cigna adopted its review system more than a decade ago, but insurance executives say similar systems have existed in various forms throughout the industry.

In a written response, Cigna said the reporting by ProPublica and The Capitol Forum was “biased and incomplete.”

Cigna said its review system was created to “accelerate payment of claims for certain routine screenings,” Cigna wrote. “This allows us to automatically approve claims when they are submitted with correct diagnosis codes.”

Yes, I’m sure this was about providing better service, and not the estimated millions in savings from denied claims. Snark aside, I absolutely am sure that similar systems exist throughout the industry. Like I said, every for-profit health insurance corporation is a parasitic middleman. As a group, they have forced themselves into everyone’s lives, and because capitalism requires ever-increasing profits, they will never stop looking for ways to avoid paying for healthcare. They have also, while insisting ProPublica’s reporting is wrong, refused to answer questions or provide more information. The article digs much deeper into the issue that I’m going to here, but I wanted to highlight one bit:

Howrigon, the former Cigna executive, said that although he was not involved in developing PXDX, he can understand the economics behind it.

“Put yourself in the shoes of the insurer,” Howrigon said. “Why not just deny them all and see which ones come back on appeal? From a cost perspective, it makes sense.”

Cigna knows that many patients will pay such bills rather than deal with the hassle of appealing a rejection, according to Howrigon and other former employees of the company. The PXDX list is focused on tests and treatments that typically cost a few hundred dollars each, said former Cigna employees.

“Insurers are very good at knowing when they can deny a claim and patients will grumble but still write a check,” Howrigon said.

This is what capitalist “innovation” looks like, and it’s happening at every level of our society. You know how every customer service line is always experiencing higher call volumes than usual? Yeah, they’re lying to your face, and they know that you know they’re doing it. There is zero downside to under-staffing their customer service department. The long waits will make some people give up without even having to spend money discouraging them! And if it means customers are dissatisfied, what are they going to do, turn to a competitor? Everyone knows that this is just what the world is like now. They’re betting that we’ll go along because we don’t have the time or energy to fight, and most of the time, they win that bet. The same is true with banks and their myriad of fees. The basic model of banking, where you take deposited money and invest it to make a profit, never stopped being profitable. It never stopped being profitable enough that banks could give people interest back on the money held there. They don’t care how much money they have. They don’t care how little money you have. The only thing that matters to them is that they get more money, no matter the harm it does.

In 2014, Cigna considered adding a new procedure to the PXDX list to be flagged for automatic denials.

Autonomic nervous system testing can help tell if an ailing patient is suffering from nerve damage caused by diabetes or a variety of autoimmune diseases. It’s not a very involved procedure — taking about an hour — and it costs a few hundred dollars per test.

The test is versatile and noninvasive, requiring no needles. The patient goes through a handful of checks of heart rate, sweat response, equilibrium and other basic body functions.

At the time, Cigna was paying for every claim for the nerve test without bothering to look at the patient file, according to a corporate presentation. Cigna officials were weighing the cost and benefits of adding the procedure to the list. “What is happening now?” the presentation asked. “Pay for all conditions without review.”

By adding the nerve test to the PXDX list, Cigna officials estimated, the insurer would turn down more than 17,800 claims a year that it had once covered. It would pay for the test for certain conditions, but deny payment for others.

These denials would “create a negative customer experience” and a “potential for increased out of pocket costs,” the company presentation acknowledged.

But they would save roughly $2.4 million a year in medical costs, the presentation said.

Cigna added the test to the list.

The problem is that the greed of the capitalist class is insatiable and without conscience. They deny payments because they can. They create new fees because they can. They push the responsibility for making sure they do their jobs onto their customers, because what are you gonna do? Ask the government for help?

Well, sometimes. Several state officials have indicated that they’re going to look into this Cigna story, and that’s nice. I hope they do, and I hope this system is ended, and Cigna is forced to actually hire enough people to do the work they’re supposed to be doing. The problem is, I can almost guarantee that if they’re forced to pay a fine, it’ll be less than the profits they made from this, and they might fight even that, just to avoid setting the precedent that they can be held accountable for stealing from their customers.

Because that’s what this is. They are stealing from people to whom they absolutely owe money, and they are betting that the government – run by two parties that explicitly support capitalism – will claim that the law isn’t clear enough, so they can either continue doing it, or they simply have to stop doing it going forward. The game is rigged by the very nature of how our system is set up. If you steal a few hundred dollars from Cigna, you’ll get locked up, but if they do it to millions of people, not a single executive who made that decision will lose an ounce of freedom. At worst they’ll go from being obscenely rich to very, very slightly less obscenely rich. They don’t even risk becoming a normal person like the rest of us, so why wouldn’t they steal?

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