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Discussion (35 Comments)Read Original on HackerNews
When an insurance company denies a health claim overruling a doctor, it can be necessarily concluded that either:
1. somehow the company knows more about the patient's condition and the doctor is wrong
2. the doctor is defrauding the system and the insurance company caught the doctor cheating
3. the company is defrauding its clients.
There is no middle ground honestly, and yet "5% of denied in-network claims were turned down because the care was deemed not medically necessary".
This is absolutely crazy and evil. I would expect a few thousand cases annually and probably for million of cases you get denied what you pay for because "we detected your doctor is wrong and we're not paying".
>In fact the single largest category, 36% of denials, was an unexplained "other." A system that rejects tens of millions of claims a year and files more than 1/3 of those rejections under no stated reason is hard for an outsider, or a member, to audit.
I can't even imagine getting lifesaving care denied because of "other". I didn't know things were so grim in the USA and honestly now I'm kinda surprised that more people are not getting "Luigi'd".
I think the truth is murkier than what you're providing. With the caveat that I am presenting a strong case here that likely isn't what occurs most of the time, consider this:
A person may require long-term therapy after an illness. There are data suggesting that beginning this therapy works better once you attain a certain level of clinical recovery in the hospital. There are also data suggesting that it's better to begin the long-term therapy as early as possible.
Both sets of data are, on their face, credible. There is no obvious reason to always believe one set of data over another. Reasonable people can make reasonable arguments to reasonable listeners for either case. Note that this does not mean that there is not a 'correct' interpretation for any given person's clinical situation!
So what does your insurance company favor? Obviously it will always favor the less expensive option, and there will be no way for them to be convinced otherwise because the underlying question is just not well-determined.
There is also “medically reasonable”.
For example getting your teeth cleaned professionally is not medically necessary. But it’s medically reasonable.
I don’t want a health insurance that only does “Medically necessary” things.
This is literally illegal! Physicians cannot refer patients to entities they own or have an interest in.
What is perverse is that, while we have the Stark Law to constrain physician behavior, we've decided that it's okay if a diffuse group like a non-physician-owned hospital chain enforces rules to this effect.
There has to be a done of exceptions to this.
You see a cardiologist and they recommend a stent. They aren’t going to recommend a different cardiologist does it.
You see a doctor, and they refer you for a test. They have a share portfolio that contains shares in the facility they referred to.
Medicine is riddled with potential conflicts of interest. Managing them is what professionals are supposed to do and what regulators are supposed to enforce.
I don’t live in the US, I’m a n Mew Zealand. Sadly, I am aware of behaviour that looks like corruption in our system.
Healthcare ain't no different. Bureaucracy gonna bureaucracy.
I can't tell if you're being serious. I'm not American but all of my American friends tell me the US healthcare system is an absolute nightmare
My criticism of the analysis is not a defense of US healthcare.
These are, of course, anecdotes, but here some things from my life:
- Next day MRI for my wife after she injured her back at the gym. Had it been more serious she would have been seen the same day.
- Friend's kid was diagnosed with leukemia. They were admitted to the cancer ward the next day, where they stayed for months. The room was large, with a pull out double bed for my friend and his wife to sleep on. The same thing happened with my cousin when she was diagnosed with a brain tumor.
- Our kids were both born at one of the "poor" hospitals in the largest city in our state. We were the only ones on the floor who shared the same last name, and most patients did not speak English. It was excellent. We had our own room (with bathroom, shower, small bed for me to sleep on), great staff, etc.
- Urgent care available 7 days a week at numerous locations within a 5-10 minute drive from my home. Typically a 15-20 minute wait for things like stitches, burns, dislocated fingers, etc.
- Nice pharmacies all over the place, which also provide things like vaccinations. Lots of our medications are now just shipped to our house directly
- The small surgeries I've needed have been done within 2-3 weeks of meeting with my primary care doctor. If they would have been more serious, the timeline would have been significantly shorter, within a day or two. Things like colonoscopies are also available within a number of weeks.
- The hospital system we use has done a really good job embracing technology. The app/website they offer can be used to view all of your test results, message the doctors or nurses, schedule appointments, etc
Makes me think of that study a few years ago that found most Americans couldn't afford an unexpected $400 medical bill.
Not supporting nor opposing the insurance industry, just something I think the public should watch out for and understand.
The ACA tried to make health outcomes a part of the calculation for everyone involved but it is hard to compete with the all mighty dollar.
> Only about 5% of denied in-network claims were turned down because the care was deemed not medically necessary. The rest were administrative, for an excluded service, for a missing referral or prior authorization, or for a reason the insurer never specified.
I worked in health tech for a while, and I can tell you the muck around a lot with ICD/CPT codes to maximize billing along with other shenanigans. There was actually a project at an innovation center at a well-known medical center which leveraged ML to maximize the amount of codes they could bill for without being rejected. The same kind of thing is often done by physicians who want to juice insurance.
Be mad--very mad--at hospitals and drug cos. As providers, they present themselves as patient advocates, but they're responsible for the outrageous healthcare costs. The dollar amount paid out by US insurance companies is maybe 2x that of other OECD countries, but the healthcare we get back from providers is trash (and extortive) by comparison.
I think this perspective makes sense from someone who works on the insurance side of things.
On the other side, there is no way for the insurance company to acknowledge the clinical severity of a patient except via abstruse ICD code choices that only billing clerks know. So this is a perfect case for an LLM - map normal human words onto ICD claim codes to accurately convey patient severity.
Perhaps someone should also control the moral hazard of the people owning and running this racket getting unnecessary amounts of money, or an unnecessary seat at the table.
[0]: https://galacticbeyond.com/two-percent-programmer/
[1]: https://web.archive.org/web/20260620162923/https://galacticb...
[2]: In both the economic sense, and in the completion-rate sense, because those two things are correlated. And they have been correlated since the 1980s, because a lot of the healthcare industry became de-regulated and more profitable as a result, since at least 1978 (when hospitals were de-forbidden from making profits).
Joe Lieberman realized that he was from a state with massive moneymaking insurance operations. Had nothing to do with Obama streamlining bureaucracy.
So instead of single payer, everyone got the ACA, and then the blue dog dems lost their jobs anyways.
The Affordable Care Act largely banned that. Insurers can no longer use health status or pre-existing conditions to set rates (via "community rating" and guaranteed issue rules). The result is that everyone effectively pays into a giant, heavily regulated pool. There's a finite amount of money in that pool, so someone has to ration care. That job now falls to the insurance companies, who deny or delay procedures, medications, and treatments.
Health insurers aren't saints — but the core problem is structural. When you remove risk pricing while mandating coverage, adverse selection and cost shifting are inevitable. The ACA patched one serious issue (pre-existing conditions) by breaking the fundamental mechanism that makes insurance sustainable.
We need to be honest about the tradeoffs instead of pretending this is still "insurance."