“The algorithm cannot say no, however. If it finds problems, it sends the request for review to a team of in-house nurses and doctors who consult company medical guidelines. Only doctors can issue a final denial.”
As a physician, I’ve had to speak to these so called “peers” in a peer to peer denials with both my clinic and hospital setting. They are usually people who aren’t physicians as a first line of their defense, ie therapist, nurses, etc. This weeds out the providers who either don’t care about the patient denial and blindly accept the denial, or patient has to take matters in their own hands just to get the care they need/deserve. Or worse, in the hospital that means the patient gets hit with a huge bill (already an insane number in the US even with insurance, so don’t get me started on this) or it gets delegated to another provider who has to deal with it. Quite often patients get denied medical and rehab services, esp after something debilitating like a stroke, trauma/accident, etc. and at that point the peer to peer is to weed the provider out. Usually someone will tell the patient you’ve been denied, either go home without the services they need or you fight it.
I fight it. Can’t count the number of times I’ve spoken to someone not in the field of medicine or if they are, not my field of medicine (both Family/Hospital Medicine). Often I’m fighting with an MD or “practitioner” who is some other field like a gynecologist about hospital medicine services or rehab. I’ve even had the pleasure of talking to a physical therapist and didn’t let me get a word in as we began the peer to peer. I now start of by asking for their credentials and field of speciality and demand a peer of my field to do the denying if they are so adamant about it “not being medically necessary”.
I have so much to say and could write a book about it. I just wish I had the money and connections to actually change the state of US of Corporate Medicine.
I’ve saved a message that was reposted by Bill Ackman on dealing with denials. Thankfully, never had occasion to use it yet:
>> So, your doctor ordered a test or treatment and your insurance company denied it. That is a typical cost saving method.
OK, here is what you do:
1. Call the insurance company and tell them you want to speak with the "HIPAA Compliance/Privacy Officer"
(By federal law, they have to have one)
2. Then ask them for the NAMES as well as
CREDENTIALS of every person accessing your record to make that decision of denial.
By law you have a right to that information.
3. They will almost always reverse the decision very shortly rather than admit that the committee is made of low paid HS graduates, looking at "criteria words." making the medical decision to deny your care.
Even in the rare case it is made by medical personnel, it is unlikely that it is made by a board certified doctor in that specialty and they DO NOT WANT YOU TO KNOW THIS!!
4. Any refusal should be reported to the US Office of Civil
Rights (http://OCR.gov) as a HIPAA violation.
Seems useful, but bureaucracies don't refuse, they delay and obfuscate. So before trying this I would probably seek info on how to deal with bureaucratic realities.
Example: I had an inpatient hospital stay where the payment assistant person was never available, never returned calls. Not while I was in the hospital for days, nor in the weeks afterwards.
Technically, I "left against medical advice", though the last doctor I spoke to agreed with what I was doing.
Over two days of trying to manage costs, then 36 hours of planning and asking to leave all basically got me nowhere and I had to kind of force walk out.
It'd be pretty dystopian if in order to get medical care Americans had to pay some middle man app/service so that it can fight with the middle man the private insurance company they were paying had already inserted between them and their doctor. All if it just raises the total cost of care for the American and absolutely none of it is necessary. The actual fix is to just get rid of the private insurance company and cover everyone's medical needs under a single payer plan.
I feel like this should really be something people should lose their license over.
By deeming something not medically necessary they are (in my opinion) effectively practicing medicine. If they aren't qualified to practice that specialty, or aren't acting in the patients interest we should really be getting malpractice suits on them and stripping medical licenses.
Legally speaking the health plan employee isn't practicing medicine in that circumstance. The requesting provider is still free to treat the patient, they just won't be reimbursed by the health plan. The requesting provider can do it for free, or the patient can pay cash. I do understand that those aren't realistic options in most cases, I'm just explaining the legal distinction.
If it's not medicine, why do they say the word "medical"? Why does the insurance company pay a doctor to do it, if they could pay someone cheaper to say those words? I'm not a doctor or lawyer, but if I had to guess, the answers are that the law requires it be a doctor exercising their medical training, while the company tries to hide behind arguments like this to get around the law.
Okay, I was too glib, but without specifically examining state laws and the percentages of patients they affect, this is also too vague. Yes, some states do require a doctor to review denials. https://www.ama-assn.org/system/files/prior-authorization-st... Now that I see this is not universal, I concede my argument doesn't prove much outside of those states.
This seems like a straightforward argument based on existing practice of medicine laws rather than anything specific. Your arrangement with the health "insurance" company is that they will cover treatments that are objectively medically necessary. In our society, such judgements are made by licensed domain experts with a duty of care (whether a doctor, attorney, professional engineer, etc). Someone without that license (and associated duty of care) is simply not qualified to render an opinion that counts as medical advice.
The overall situation is that the insurance company doesn't want to trust your doctor's judgement [0], so they insist on getting a second opinion about the care you might need to receive. That second opinion is still being performed by a licensed doctor who is supposed to be working in your interests - it's a straightforward practice of medicine the same as if you yourself were to go and seek out a second opinion.
[0] or really they want to play good cop / bad cop - remember "your" doctor themselves is essentially also an employee of the insurance company!
It might seem that way to you but that legal theory hasn't succeeded in court. Feel free to try again, though. I'm not claiming that the current legal situation is a good one but any significant change will require an Act of Congress.
> Legally speaking the health plan employee isn't practicing medicine in that circumstance
Feels like convenient lawcraft to wash the health plan employee’s hands of liability. I’m sure the prevailing popular opinion would be that this is practicing medicine.
If "convenient lawcraft" is the new slang for "words have meanings" then absolutely. Insurance company employees talking about insurance is practising insurance. Nobody wants them to practice medicine, the question is whether they are they going to hand over the money or not. Money is not a form of medicine, even if the person deciding where it gets sent is medically qualified.
Although on the words having meanings front, whatever is going on here is pretty clearly not insurance at this point; it'd be better just to honestly call it welfare rather than force people to redefine the word 'insurance'. It is hard to talk to people in the US about actual insurance now because they don't have a word for it any more. Politically redefining 'medicine' too would be a mistake, important conversations will become incoherent.
But you didn't build my house, and if I literally get angry with you because I think you should abandon your legal shenanigans, admit to being a builder and take on legal liability for the flaws in my house that would confuse you because you are, in fact, probably not a builder and certainly not the person who built my house.
The issue with teeray's original comment is that they are saying someone who isn't practising medicine should be considered to be a medical practitioner. In fact, in this context, teeray is annoyed with them specifically because they didn't practice anything. Your analogy became irrelevant the moment it involved you doing anything.
> “X is or is not medically necessary” seems like a decision a medical professional should determine, no?
No, that is ridiculous. If I think I need to go to a hospital I'm going to go to the hospital. I don't need qualifications to work out something is medically necessary. I'm unlikely to be involved with the medical industry at all unless I've already personally determined it is medically necessary that I consult a doctor.
As a rule of thumb, patients have the final word on what they actually consider necessary. Literally anyone can have an opinion on the subject. Like, for example, an insurance worker. If the patient or the doctor is of a different opinion then they can go pay for the work themselves. It isn't that uncommon to have to go through 3 or 4 medical professionals to find one who agrees that work is necessary; I have a cancer story like that in my family.
I think the right analogy here is that I'm a renter and the person who built my house (builder) is different from the person who paid for the house (landlord). The builder said the roof needed trusses but the landlord decided they weren't "structurally necessary" and refused to pay for them. The roof collapses on me...does the landlord escape liability?
Maybe an even better analogy is that I live in a rented home and after I report some weird respiratory issues, an inspector finds black mold all over the place. The landlord refuses to fix the issue because "black mold is totally fine, bro" and I get really sick. I could maybe have moved out, but I kinda feel like the landlord is going to have a bad time here.
That analogy would make sense if there were a credential that one had to have to make an authoritative decision, and the people making the decisions lacked the credential.
Words do in fact have meaning, which is why if you want your decision to be viewed as an insurance one rather than a medical one, you probably should avoid using phrases like "medically necessary" as justification for your decision to approve or deny insurance coverage. Using that phrase strongly suggests that while the ultimate decision was about providing or denying insurance coverage, what informed that decision was a medical determination about the actual necessity of the procedure. If you want to keep the decision firmly in the insurance realm, better considerations to mention might be expected lifetime payouts, shareholder value, and "because fuck you that's why".
> Nobody wants them to practice medicine, the question is whether they are they going to hand over the money or not.
This doesn't make any sense. They're not handing over money for fun, they are supposed to pay for the medical services the insurance is supposed to cover. And the only person qualified to decide if that medical service is appropriate is a doctor who specializes in the field of that specific area.
If you aren't legally qualified to make medical decisions then you are not allowed to use terms like "medically necessary" in your decisions. That our judges haven't bothered doesn't protect us from this obviously illegal abuse is just one of a million of illustrations of how poor our legal system is.
> The requesting provider can do it for free, or the patient can pay cash.
That might not be actually an option. Well the provider can do it for free, probably; but they may not be able to accept money for care that was denied coverage. A Medicare provider can charge patients for things outside the scope of Medicare, but generally can't charge for things in scope but deemed not medically necessary: ex if Medicare says 6 PT visits for whatever and you would like to have 8, you can't pay the provider for two more; you'd have to find a non medicare provider or come back with a fake moustache.
I had to take my kid to an express care doctor in the US. My wife had the insurance cards and was on travel. I said I would just pay cash. They said because I had insurance I was not legally allowed to pay cash.
Sorry, but this feels like a lot of weasel lawyer doublespeak nonsense. Denying insurance coverage for a specific procedure for a specific patient based on whether you think that procedure is necessary is absolutely making a specific medical decision that will impact the treatment of that patient. The idea that this does not constitute practicing medicine is absurd and the fact that the patient can potentially still obtain treatment seems immaterial. A doctor who flat out told a patient a certain procedure wasn't medically necessary could be legally liable if that wasn't accurate, so how is the same not true of an insurance company who has far more impact on the ability of the patient to obtain treatment?
The reality is that this is the insurance companies trying to have their cake and eat it too. They actually want to be making a medical decision in denying coverage since it gives them a legitimate reason to do so, but want to avoid any liability if that decision was wrong.
Right? Lawyers can get into deep shit if they misrepresent their ability to well, represent a client on a case outside of their area of competence. How are medical professionals that often won't even tell you what they think about a test result and refer you to a specialist to actually get a diagnosis able to ethically represent what a patient actually needs?
1. It’s unpaid, short answer. Not part of your visit, usually a visit code is just one time based code for everything you provided and maybe a procedure if you did something like ear flushes, wart burning, quick wound fixes, etc. Long answer below.
If there’s a billing code for it, I’m not aware of it and frankly I shouldn’t have to use it. For providers, it’s part of their “administrative time” which used to be a full day of catching up. In most hospital or insurance-owned clinics, that admin day is gone. You now do this during your lunch break and anytime you can squeeze a phone call. Fun fact, in the hospital, these peer to peers are at the mercy of the insurance company and only give you 24-48hrs to do it, so the hell to the overworked provider and their schedule, again this is exactly what they want. A overworked provider who doesn’t have the energy to fight. Providers are so overworked, they no longer can you catch up on charts and hence why the patient-provider relationship has eroded and become so cold when you see your provider just typing away instead of focusing on you.
2. Fight. Appeal your denial. Make sure your provider does the same. Follow this: https://news.ycombinator.com/item?id=48126000#48128288
Can’t speak to all providers, but most of us are good people trying to do their best to help people. Few bad actors out there give us a bad name, but every field has good vs bad. It’s not right to make hasty decisions based on legitimately a few bad providers out there because of their greed, corruption, fraud, etc and lump everyone to prove they’re not fraudsters. Your basic primary care physician/NP/PA or surgeon isn’t the problem. It’s the conflict of interests of the health care industry, private equity groups, etc who create these issues, exploit the system and make it a breeding-ground for fraud/etc then complain that it needs to be fixed with more middle men.
It's like any time spend on billing or administrative work, it's baked into the costs. (Administrative costs is a big component of rising healthcare costs.)
Depending on the issue, the patient may be needed to provide supporting paperwork, like previous diagnoses or treatment for providers. Other than that, not really, short of taking legal action.
First off, thank you for taking the time to do it. I know most people don't agree on many things today, but most Americans agree the current system is stacked against them. Not to search very far, I have good insurance and I still have to deal with things that border on criminal.
This is good to hear. My mother was a PA for a private practice and also would often call the insurance providers to challenge denials, often from people far from the relevant specialty. By her accounts she was usually able to reverse the denials.
seriously consider that book if you can fill it up with these types of stories. A book like this could be a huge hit, get this issue even more spotlight and maybe some fixes.
> I just wish I had the money and connections to actually change the state of US of Corporate Medicine.
It will never happen.
This is largely what at least half the country wants.
“If I need to take a drug test to earn a check you better take one to get welfare.”
I’ve heard a working class person say this. I guarantee you the people who own defense contractors, the real welfare queens don't need to take a drug test.
Likewise, the horrific thought that someone unworthy might get free healthcare is appalling to half this country. They’d rather go without just to ensure *those people don’t get free healthcare.
This country doesn’t want to be fixed. It wants RFK to tell you to treat Autism with raw milk and sunshine.
Nothing much to do but try to find a civilized place to live
Definitely write to NYT or Guardian or Atlantic about this stuff! Journalists probably have a ton of info on how messed up the system is, but if feels like you have data-backed opinions and documentation to remind yourself of examples!
In the early 2000s I got a job right out of highschool working at a Blue Cross Blue Shields call center. I thought it was going to be customer service but it was insurance claims. Training was supposed to be 6 weeks but they pushed me live after just 2. I had no idea what I was doing. After floundering for a couple weeks trying to learn to basically be a fuckin doctor, I just started approving everything. "Patient needs emergency surgery for X" "Approved". The whole experience was completely insane.
I didn't stay long enough to find out, but yeah, they probably would have. The pressure was definitely to default to deny it. That's what the run books (very few) were defaulted to. It was really just a bunch of expendable people to deny claims. The turnover was wild for obvious reasons.
Physician and Hospital resources is a real zero sum game, how do you fairly regulate the medical landscape so those who's lives will benefit most from a procedure will receive the procedure?
Who decides this? You?
Should we allow everyone in the world who needs a procedure to receive one free and get ahead in line for Americans who need the same procedure? That's what the current climate looks like with unbridaled immigration under progressives.
Why not pay for these things out of taxes? I don't think you'll be so quick to defend the system if you ever find yourself needing care beyond a checkup once a year. It's designed to make the insurance carrier money by constantly having little costs slip through the cracks that should be covered. Get a dental checkup? Sorry one of your X-Rays wasn't covered but the other ones were. Now you get to spend hours fighting for a $13.00 cost. Oh you're at the max for this service for the year because we accumulated the estimated cost when you started calling doctors about what the after-insurance cost will be. Wait a minute this out-patient consult is actually a surgery because you saw a surgeon so it must have been a surgery, and it's not medically necessary to have the surgery without the consult.
Because there are a finite number of doctors and hospital beds and you can't create either by throwing more money at the problem. You didn't actually read the content did you
The doctor has already managed to find time for the service - she’s seen you. Potentially even done the procedure. The hospital has made room for you. The resource is already consumed by you, like a restaurant meal. The question is who is picking up the check, when you already have a subscription service paid for.
The service is not “free healthcare for any procedure ordered by a doctor all the time without limits”, they have the right to refuse something they feel is unnecessary
Why isn’t it “any procedure performed by a doctor all the time with no limits”? Do you think there’s a cabal of doctors doing medical procedures for funsies? And that if such a thing did exist, it would be a bigger problem than some company who has never seen you, never examined you, and you’ve already paid money to, denying the claim because they judge it “unnecessary” when the doctor who did see you claims it is?
I guarantee you that the insurance company has zero clue or consideration for any physician and hospital resource constraints.
Gating access to medical care is the job of the patient's PCP and or other doctor. If the care is truly, meaningfully rationed (like transplant organs and blood banks), there are triaged priority lists managed by medical organizations.
Medicare has a similar issue. When you sign up at 65, you have to make a first big decision, Traditional Medicare (yay!) or private Medicare Advantage (boo!).
Traditional Medicare consists of Part A (hospitals), Part B (doctors) and Part D (drugs). Part A+B don't cover everything so you have a Medigap plan. I have Plan G which has very little paperwork. All up, I spend about $400/mo and I'm very happy with A+B+G+D.
With Medicare Advantage you sign over your Medicare rights+benefits to a private insurer. This may save you some money, especially early on. In fairness, not really a lot and the $0/mo plans are a scam. With Medicare Advantage, you will then have to argue with an insurance company for the rest of your life. You'll have to deal with preauthorizations and a restricted network.
With Traditional Medicare, what's covered is spelled out pretty clearly ahead of time. Docs know it. You know it. There's literally an app for that. With Medicare Advantage, medically necessary is at the discretion of the private insurance company.
Here is the scenario from a relative: he had a heart event which ended up needing a stent. He had to argue with Kaiser while this was going on. Kaiser is 240,000 people. He is one.
Medicare Advantage is very profitable.
It is possible to switch back from MA to TM which really revolves around your Medigap plan. You are guaranteed issue for Medigap plans for about 3 months before/after you turn 65. After that, you will have to undergo medical underwriting.
"Medicare Advantage" = HMO. All the usual HMO problems.
The best Medigap plan is Plan F, which is no longer available to new subscribers.
"Discontinuation of Medicare Plan F was a strategic decision aimed at promoting responsible healthcare spending and ensuring the financial sustainability of the Medicare program." It covers just about everything Medicare doesn't pay, including the various deductibles Medicare has. If Medicare covered Medicare's part, the Plan F provider has to pay their part. They don't get to question it. I don't even see hospital bills, just statements that it's been paid for.
I’m 40, on Social Security Disability Insurance and recently became eligible for Medicare.
After years on Kaiser because of familiarity, when I became eligible for Medicare, I had to make a choice between original Medicare or Medicare Advantage.
It’s incredible expensive to buy into adequate coverage if you’re under 65 and on disability and want original Medicare, but after the mixed experience I had with Kaiser, I wouldn’t have it any other way.
As I have some serious health conditions, I signed up with Plan G Extra and a high coverage tier for Part D. It’s going to cost about $1300/mo plus an additional $202.90/mo for part B, but it’s better than having to worry about future health issues putting me in financial ruin.
Nice to preserve choice being responsible for at most a $283 deductible per year on top of the monthly cost.
I had a 3 day hospital stay in December 2024 that was $75,000 and I didn’t have to pay for it, so it was worth it to have good coverage.
The theory behind Medicare Advantage is that it would cost the government less than traditional Medicare because the private insurer would be more efficient. Guess what happened.
Well the only ways to make any sort of insurance pool (whether it's run by the government or a private organization, for or non profit) more efficient is to deny more payouts or aggressively select for a less risky risk-pool. Medicare insures everyone over age 65, so the second option doesn't work. You can't just leave half the elderly uninsured because they're fat and likely to run up $100,000 in knee replacements. So you have to deny more claims.
Insurance is brutally simple. Money in, money out. Trying to make your back office more lean with tech and automation has extremely limited returns, because the back office is such a small portion of the total cost structure. 95-100% of costs in any given insurance operation are claims. So everything to do making things more efficient and reducing costs has to do with reducing claims.
It's not that simple. Something like a quarter of all healthcare procedures aren't justified on an evidence-based medicine basis and do nothing to improve patient outcomes. Higher quality care actually costs less. But there's a huge amount of waste and mismanagement at all levels of the system.
In fact, MA costs the government more per person than does TM. MA may have been lobbied for as a cost saving measure. It is, in fact, a profit center for insurance companies.
I worked at one of the companies mentioned in this article for a brief period of time as a junior employee.
The entire framing on the inside is about helping the industry adhere to evidence-based medicine and reign in the skyrocketing costs of healthcare.
The analysts would periodically share results of their anomaly detection, finding physicians who order MRIs at rates multiple standard deviations above the average physician, and further find that these physicians own their machines.
There are a lot of examples of this kind of fraud. There’s also bloat and over prescription as doctors are terrified of malpractice and have patients demanding tests or procedures they read about online.
When I was working in the company, I really felt like I was helping reign in unnecessary costs. We had many people reading medical literature, consulting with other physicians, scientists and others to create guidelines that form the basis of the pre-approval decisions. It felt like we were centralizing all of that knowledge and “providing it” as a service to society.
One day, a brave junior employee asked the company CFO at a lunch and learn, “If we’re doing such a great service for patients, why is it the insurance companies paying us, instead of patients?” The CFO gave one of those replies that is only memorable because of how fumbled it sounded.
I realized quickly after that what purpose the company really served and how the incentives created a serious conflict of interest. But my time at the company has convinced me to this day that there are no “innocent” parties in the payer-provider-patient triangle. Every party involved has their own set adverse incentives against each other and the balance of power swings like a pendulum with every merger, acquisition, or regulation passed.
The worst part, simultaneously soul crushing and apocalyptic rage inducing is that we get these outcomes after spending more per capita on healthcare than pretty much any country on the planet.
Yeah they are. Americans engage in more unhealthy eating, crime, and drug use than Australians. It’s very easy for me to believe that they’re 3 times as sick.
Australia is very close behind the US in obesity and illicit drug use.
Side note: I'm an Australian citizen, living in the States.
An Australian hospital doesn't need a billing/collections department and the docs don't sit on appeals calls with insurance; when my wife broke her foot visiting, they basically didn't know how to bill her (for surgery and three days in a ward!). My son needed a badly ingrown toenail treated on a separate visit there last year; they just treated it and sent us on our way, no charge, despite his being a tourist.
> I didn’t say obesity, I said unhealthy eating. Those aren’t the same thing.
Australians eat a substantially similar diet to Americans, and have similar health issues (obesity, heart disease, etc.) as a result. They are deeply related things.
> I straight up don’t believe the drug use one, we have way more fentalyl deaths than you and it’s not even close.
Gee, I wonder if not having healthcare (including access to things like therapy and rehab) might drive up drug death rates.
> You didn’t address crime.
Sure; you didn't address how it's responsible for 3x the healthcare costs.
Feel free to cite something that proves that Australian diets are similar to American diets. I don’t believe claims made without evidence.
Deaths are pretty much 1:1 with drug use. Us having more fentanyl deaths mean we have more fentanyl users. Feel free to cite something that proves that Australia has the same amount of drug users as the United States.
It’s a contributing factor. Americans consume healthcare at much higher rates for many reasons, some of which I listed above. I’d fully expect Americans to pay more when they consume more.
"According to the 2022–2023 National Drug Strategy Household Survey (NDSHS), an estimated 10.2 million (47%) people aged 14 and over in Australia had illicitly used a drug at some point in their lifetime (including the non-medical use of pharmaceuticals), and an estimated 3.9 million (18%) had used an illicit drug in the previous 12 months."
"Among Americans aged 12 years and older… 70.5 million or 24.9% of people 12 and over have used illegal drugs or misused prescription drugs within the last year."
That's broadly quite similar.
> Deaths are pretty much 1:1 with drug use.
You can absolutely reduce drug death rates with safe injection sites, needle programs, narcan distribution, safety education, substance abuse treatment, etc.
> Americans consume healthcare at much higher rates for many reasons, some of which I listed above.
Americans pay substantially more money for the same procedures and medications. Again: THE EXACT SAME THING; no difference in amount or quality consumed, just drastically more money going into corporate pockets.
"Atorvastatin, a medication to lower cholesterol and prevent cardiovascular disease, is priced as little as A$6.70 for 30 tablets in Australia, compared to US$2,628 for Americans."
"However, the biggest shock was Sofosbuvir, which treats hepatitis C, with a 12-week treatment roughly costing an eyewatering US$84,000 without insurance and discounts. Meanwhile, it costs about $31 for a packet of 28 in Australia on the Pharmaceutical Benefits Scheme (PBS)."
It "costs" much less--because in reality we end up footing the R&D bill. The drug companies tolerate sales to the UHC countries so long as it's above their marginal cost. If US customers were also paying $31 for that Sofosbuvir there's no way the company would recoup costs and they would not develop it.
Fixing this will cause big shakeups in the universal coverage systems and thus big political shakeups. It should be done, but gradually.
I will also say the comparison is false--my wife is on Atorvastatin, it's even less than what you are quoting for Australia. You're comparing the brand name with the generic.
A family member recently got a routine physcial blood test panel taken. The company made 3(!) separate overcharge billing errors associated with this one screening. Their doctor had to be pulled in and wasted a considerable amount of time clearing this up, doing stuff like affirming to their support that the documentation from their own front desk was accurate. Maybe for every $100 of doctor time they waste they collect $101 from patients who give up. No wonder its a black hole of money.
It's going to the administration overhead. If you have to document everything and argue for every medical procedure and deal with 20+ different processes for filing claims then it takes time. And, as a provider, you have to pay someone to spend that time if you want to get paid.
It doesn't help that our healthcare billing systems are so outdated and broken. I once had a doctor visit denied with the reason code that it should charge the other insurance (for people on multiple plans). I was only on one plan, but my wife was on two. The doctor and I went through all the paperwork - my name was right, my birthday was right, my policy number was right and when I got notice of the rejection it had my name on it. Eventually we traced it to an error - not in my insurance company, not in the company that handles claims in this areas for my insurance, but instead in some middle-man company that was responsible for transferring claims between the two. Nevermind that all three companies claimed to be BlueCross BlueShield. This took over a year to resolve.
No it's not. There is absolutely no way to get from $360B of insurer admin and net cost of insurance to $2.5T --- two point five trillion --- in practitioner costs on paperwork overhead. That is not a plausible argument.
> A new study finds that the extra time and labor physician practices spend on interacting with insurance companies and government entities cost U.S. physicians $82,975 each per year, while doctors in Ontario spent $22,205.
> Canadian physicians follow a single set of rules, but U.S. doctors grapple with different sets of regulations, procedures, requirements, formularies and forms mandated by each health insurance plan or payer. The average U.S. doctor spent 3.4 hours per week interacting with health plans; Ontario doctors spent 2.2 hours. The bureaucratic burden falls heavily on U.S. nurses and medical practice staff, who spent 20.6 hours per physician per week on administrative duties; their Canadian counterparts spent only 2.5 hours on paperwork.
All that falls in your $2.5T bucket. And their cleaners, HR, etc. And insurers have had 15 years of innovation since that study.
You haven't done the math here. Multiply the numbers out. This is what I'm talking about. How are you supposed to engage with these topics if you're literally recoiling from 7th grade arithmetic? Congratulations, taken on your own terms, you just found 3.6% worth of savings from practitioner costs.
My local grocery store wouldn't even bother issuing a coupon for that small a discount.
Yes, as I said, if we accept your claim at face value, that every dollar of American practitioner-side insurance overhead --- not the delta from Canada, but every single dollar of it --- is mis-spent, you managed to identify 3.6% of the waste in the system. Congratulations.
I said earlier we'd gone round-and-round on this topic before, and I was a little burned out on it, but I didn't expect you to refute your own argument like this. I'm glad we gave it another run this time! This is a great statistic; I'll be using it elsewhere. Thank you.
Insurance has more than one way to run the costs up; this is but one of them. Weird rebate deals with drug manufacturers. Vertical integration. Buying practices and paying them higher rates.
> I was a little burned out on it
I just did my taxes and am a little burned out by the $49k in healthcare expenses I got to deduct on them.
The reason it's going to providers is because US healthcare is extraordinarily inefficient. Providers spend too much time doing, well, everything. From admin, to medical records, to documentation. Very little of their time goes to actual, direct care and decisions around care. You can talk to a doctor about this if you want, they'll all tell you the same thing.
Even surgeons. Ask a surgeon how much time they spend in the OR. It's less than you think.
> Today, many of those practices have been bought up by large corporations, including hospitals, private-equity firms and even health-insurance companies. It’s a shift that not only has changed how money moves through the health care system, but may also be helping some insurers boost their profits, according to new research published in Health Affairs.
> A study from researchers at Brown University’s Center for Advancing Health Policy through Research and the University of California Berkeley found that UnitedHealthcare, the nation’s largest health insurer, pays doctors who work for its own physician network, Optum, more than it pays independent practices for the same care.
This isn't a response to anything I just said. I really don't understand why people collapse into all this handwaving when people point out the obvious: the money in our system is going to providers, and, in particular, it's going to practitioners.
What difference is that supposed to make? The money is still going into the pockets of practitioners. And: no, the claim you're making here about practitioners fighting insurers: closer to the opposite thing is true.
The idea that the problem with our system is health insurers is just slopulism. We have grave problems with our system! But they start with the providers, where the majority of all the funding in our system goes, not to the scapegoats they've stoop up in our insurers. The distinction is vitally important, because the most popular answer to this problem is to extend Medicare to everybody, and Medicare is just as victimized by this as everything else is!
We pay doctors too much, and we artificially restrict the supply of practitioners. Those doctors routinely overprescribe. Every other problem in the system is marginal.
"The money is still going into the pockets of practitioners."
And by inflating that amount...
> Using newly available federal price transparency data, the researchers found that UnitedHealthcare pays Optum physician practices about 17% more than non-Optum practices in the same region. In markets where UnitedHealthcare holds a large share of the insurance business, that difference was even larger, up to 61%.
their capped-by-law 20% cut of premiums goes up, too. "Oh, those mean old providers we own charge so much! We have to raise premiums again!"
Show me the more recent NHE table where this effect shows up and I'll be ready to have the conversation, but right now this seems like a dodge. Whatever effect you're describing, if it's material, has to have started after the NHE data I just posted, from 2023. I don't remember thinking that the health system in 2022 was good.
Fun thing about the NHE: you can project it as far back as you want. The data is there.
I feel like we've been in this argument before, and I like you just fine as a commenter, but do feel like you're tying yourself into knots to avoid a simple conclusion plainly supported by the data. I didn't post a trend story about what companies are doing or who they're acquiring; I posted the macro NHE table from last year. It simply refutes the argument you're trying to make.
> It literally breaks practice and net cost of insurance out!
But it's not a "Cost of Health Insurance" item. It's an expense at the practicioner level! They have to factor that non-billable time into what they charge for the procedure!
If an insurer manages to double a doctor's administrative costs for billing/appeals/etc., where does it show up in your tables, per your link's PDF of definitions?
You have no evidence for this argument. It's just vibes. The numbers here are stark. It's not like it's close, between providers and insurers. Insurers are almost literally a rounding error.
You asserted "the macro NHE table from last year… simply refutes the argument you're trying to make", but that claim is false. You are welcome to answer the question about where "doc spends two hours on phone arguing with UHC" falls in the expenditure list; it's not insurance, but it's caused by it.
> Insurers are almost literally a rounding error.
Again, the argument is that the raw cost of health insurance does not reflect its externalities imposed on the other items in your list; that insurers drive up hospital and practice costs, as they have to staff up enormous amounts of staff and expensive physician time to deal with the insurer.
You stated this claim upthread, for the record, and tracked down an actual Canada vs. US statistic on this, which turned out to account for roughly 3.6% of total provider inpatient/outpatient expense.
That's not an argument; it's just vibes. Whenever we get actual numbers to look at, your arguments fall apart.
Again, I want to be clear: I'm not here to defend the American health system. It's a disaster. It's just clear to me you don't have a bead on why that is. (The answer is artificial scarcity of practitioners, overprescription, and lack of price transparency).
Non-falsifiable argument is non-falsifiable. I could literally present you evidence that 2.2T of our medical expenditure is due to a price-fixing ring in syringes, and you'd still be able to use the same argument.
> In 2022, Carelon settled a lawsuit for $13 million that alleged the company, then called AIM, had used a variety of techniques to avoid approving coverage requests. Among them: The company set its fax machines to receive only 5 to 10 pages.
Who are the people who sleep at night after designing these policies?
Patrick Rucker, one of the authors, spent time at our company, Claimable, last fall so he could investigate this issue further. Claimable is a startup where we leverage AI to help people appeal their health insurance denials. Ask me anything, I work in this space every day.
The CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F) is driving some industry improvements in this area and there's a lot of opportunity for technologists to help implement it. While the rule mostly only applies to Medicare Advantage health plans, many payers are voluntarily implementing the same HL7 Da Vinci Project Prior Authorization Burden Reduction APIs across all lines of business. These APIs give providers standard ways to check whether prior authorization is required for a plan of treatment, find out exactly what documentation the health plan requires, and then submit the prior auth request. This won't solve the problem of improper denials but will at least reduce delays and errors.
I understand that nobody likes to talk about setting this threshold, but it's not some kind of unique feature of the American healthcare system. I think the article raised some reasonable concerns about EviCore, but it would be a lot stronger if it did more to contextualize denials in terms of the other quadrants (correct approval, correct denial, incorrect approval, incorrect denial). It would also be interesting to compare those statistics across types of insurers (for-profit, not-for-profit, and government).
There's entire companies (example: MedExpert) whose clients are health insurance companies whose job it is to re-route physician and patient requests for expensive necessary treatment to cheaper alternatives: https://www.medexpert.com/results/
When they can't completely deny they delay and/or set up burdensome hoops for the patient to jump through before they will qualify for treatment. It's literally their business model.
They even brag about it on their website!
> Reduced inpatient hospital admissions by 15%
> Reduced use of skilled nursing facilities by 15% (because we won't approve them for nursing care!)
> MedExpert clearly reduces rates of unnecessary elective surgery.
Even if you get an approval for an expensive specialty drug, good luck.
I had the insurance written approval in my hand while the pharmacist told me it was being rejected for needing prior approval. The insurance phone rep said they could find no record of any REQUEST, let alone approval, for the drug.
So I go to the state insurance regulator. That does at least light a fire under their arse. They can't claim it's not medically necessary when I already have their approval.
During the complaint process I learn:
- Front line reps don't have any access to any pre-auths. You need to talk to a supervisor. They ADMITTED the system is by design obstructive.
- The person who entered my approval did it wrong and did not follow the SOP to run a test transaction that would have caught the error.
They then submit their reply to the regulator leaving out all of the above and blaming the pharmacy instead. I follow up with the regulator pointing this out. I have voice recordings.
Regulator closed it as resolved.
I'd class action their butts if I wasn't still exhausted by the experience two years later.
> Connecticut’s Insurance Department recently reviewed EviCore and Carelon. It found no problems with Carelon. EviCore was fined $16,000 this year for more than 77 violations found in a review of 196 files.
$16k is such a low fine that it’d be funny if it wasn’t so sad. fines should be increased to actually represent a threat to the company - maybe as a % of yearly profit?
America cannot, as a country, discover a reasonable approach to managing health care costs because Americans do not have a sufficient core set of shared political values. The solution is to end regulation at the federal level, and allow the states to determine what regulations they may deem appropriate. As a New Hampshire libertarian, I do not want Californian progressives telling me how our state must manage health care spending, and I am sure they feel the same way about me.
I think the vast majority of people agree on the generalities and care enough about solving the issue to be able to come to an agreement on the particulars. The problem is that the people who get rich off the current system won't agree to any solution that reduces their profits, and have thus far managed to fillibuster attempts at such a solution through a combination of buying politicians and propagandizing certain segments of the population into rejecting solutions that would benefit them.
I'll accept your first sentence for the sake of argument. You are still better off with a localist / federalist approach, because state governments are much less vulnerable to corruption and bribery. It is far more economically efficient for the bad guys (whoever they are in your view) to bribe a few DC legislators than dozens of state politicians in places like Montpelier and Hartford. Centralized, unaccountable power in DC means that when big rich corrupt companies bribe the right people, they can force the entire country to followed their preferred policies. A good example is how Purdue Pharma bribed the head of the FDA to approve OxyContin, leading directly to the opioid crisis.
> It is far more economically efficient for the bad guys (whoever they are in your view) to bribe a few DC legislators than dozens of state politicians in places like Montpelier and Hartford.
State politicians are much cheaper, and no one from the New York Times pokes around when you buy off the state representative of East Bumfuck, Montana.
so, your answer is OMG, they are making money!11!
It's not a money probelm, it's a resources problem. We simply don't have enought hospital resources to serve everyone in the us. it's not making money, it's not having enough beds and skilled people to do the work.
Get an MD and help out, then you'll discover how you really DONT want the government to tell you which patients to serve.
Honestly, after stories like these, I don't want a corporation telling me which patients to serve even more. At least government is theoretically accountable for their decisions.
Slavery was estimated at ~12% and "hey, you need to lose a few % of your margin and actually pay those people" started a war.
Now, there's an argument to be made about ideology, geographic concentration of industry, etc. doing a fair bit of lifting kicking that off (their own neighbors telling them to stop surely would have gone over better than a bunch of smarmy northerners in their ivory towers telling them the same thing). But the fact remains that you cannot make a large fraction of the country take a haircut without causing strife.
The only way to fix this "nicely" at this point is to boil the frog over decades.
This is one of those things that, if it weren't already a public service, could never be implemented as one today. Add to that list public schools and public libraries.
The fact that the hospital doesn't know what a procedure costs (they make it up based on deals with medicare, medicaid, and individual insurance companies) should give you a hint.
Yes, the patient needs skin in the game. People need to take care of their own health. Most procedures are given to grossly unhealthy people.
Yes, completely privatize it. Make people pay for their care so their daily decisions are weighed against what affect it will have on their overall health.
“ The fact that the hospital doesn't know what a procedure costs (they make it up based on deals with medicare, medicaid, and individual insurance companies) should give you a hint.”
The hint here is that the random pricing needs to stop. Same procedure for the same price. No market can work if participants don’t know the actual price. Insurance and hospitals probably have a very good idea but patients are being kept totally in the dark. You are expected to just accept what this opaque machinery comes up with.
So what if someone gets cancer or some other potentially fatal disease despite eating healthy, exercising, not smoking, etc, and they can't afford to pay for treatment?
Ah yes, more fragmentation. Surely that will lower the complexity and administrative burden, thereby leading to reduced costs!
The reason healthcare in the US is expensive is very simple: too many cooks in the kitchen. Private insurance simply should not exist. The undeniable reality is that the only way to achieve maximum efficiency is top-down administration.
I understand that that makes libertarians uncomfortable. But what we all have to acknowledge is what we have is not working. Other countries have worked it out. There's no reason to reinvent the wheel here.
I think in the case of Optum + UnitedHealthCare being the Scylla and Charybdis of a healthcare situation, we should break up this style of business. Owning both sides of the equation means there is no competition if you are unlucky enough to find this combination.
Feels like two wolves negotiating on how much of the sheep (the sheep is you) they get to eat.
Dare I ask, who is for the "consumer"? If we should even use those words in this system, which in my mind should be for a nation keeping its citizens alive and well both of their own sake and the state's sake.
That same basic "payvider" business model has been around since Kaiser Permanente pioneered it in the 1940s. The problem isn't with the business model per se, but with consolidation that has effectively eliminated competition in some regions.
As with so many situations where you have unreasonable corporate behavior the problem is the economics favors making wrong decisions. Thus there will be little attempt to prevent those wrong decisions. The only real fix is to make wrong decisions cost--look at airlines. You end up with more passengers that seats, you pay. It went a long way towards addressing the problem. (But it should have been higher and it should be indexed to inflation.)
But note the insurance is not always the bad guy. Patients want things that aren't medically warranted, especially when the right answer is "do nothing". And doctors like to run up the bill.
And note this article is focusing on things other than medical decisions--but describing a system that could only be a problem if they are making wrong medical decisions. How they decide what claims to examine is irrelevant, what matters is if they are making wrong medical decisions. It very much needs to be considered the practice of medicine and a denial should only come from someone of at least the same specialization as the doctor making the request. And "not medically necessary" should require an evaluation of why, you don't get to just say "no".
I am perplexed by the type of people that are able to stomach working in these kind of positions - how do they rationalize it? Do they really just not care? Like, in some industries that are not doing great things, or bordering on evil things, I can see sometimes how one could convince themselves they were actually doing good. But this denial stuff is nearly like, "press this button to make money, knowing you may be denying someone critical care that could kill them or cause them harm" and you're comfortable just mashing that button? How do they sleep at night? Or are there just a lot of really gung ho believers that hate provider billing with a passion and believe most of it is waste and they truly know better? Is it a bunch of sociopaths? How this can exist as an industry is crazy to me, I wouldn't even know how to hire, I'd expect the vast majority of applicants upon finding out would say "ew, no" but I guess I have a rosier view of humanity that does not align with reality.
By this logic how could you ever work in Healthcare? If you're a Doctor why are you taking a day off to - of all things - go to the beach? Do you really just not care? Take this day off, knowing you may be denying someone critical care that could kill them or cause them harm? And you're comfortable doing that? Do you love the beach that much?
What are you saying here? Do you just think it's unnecessary to audit the way 18% of US GDP is being spent? You think there is no waste, or it's so small to be negligible? Despite the fact that it's well established the US spends more and gets less benefit?
Maybe I'm just not understanding what you're saying here, but it seems pretty straightforward that you can't run an insurance system without reviewing claims. That's true whether it's a for-profit, not-for-profit, or government run insurance provider.
There's broad consensus that there is a ton of unnecessary and unwarranted care being done in the US. Doctors are not all experts in population health. Even the most well-meaning doctors are still subject to incentives that can lead to excessive testing and expensive treatments that have a low likelihood of improving patient outcomes.
Obviously it is also true that having a profit motive to deny claims incentivizes improper denials. But to simply say "no claim should ever be subject to review or denial, and anyone working to make the system efficient is evil" is deeply ignorant and fundamentally incompatible with the concept of insurance.
TLDR is that it’s a job that can pay enough to keep one housed, and sometimes there are no alternatives.
I’d redirect the outrage away from the grunts denying care, and towards the leadership that set up those incentives. And even further, when the shareholders demand more profit because the line must go up, what to do?
Thought I would remind people here of this simple, but mostly unknown fact about American healthcare:
American taxpayers invest more public dollars per capita in healthcare than anyone in the world. This before a single cent is paid into the private insurance system. Through Medicare, Medicaid, VA and other public health programs, you pay about 40% more public dollars per-capita than the most socialist, gold plated single payer system anywhere else.
You are not only getting ripped off by your insurer, but you are getting ripped off a public system, which has more than enough money to provide every man, woman and child with a lifetime of world-class, free at the point of service universal healthcare.
Geiz-ist-geil-healthcare is, according to many election results anyway, what most US citizens want; everything else is communism/socialism/woke/leftist/[...].
My IT guy spends his days pushing problems that come across his desk into an LLM and generating reports/responses. He then pushes the generated material out to people in slack channels and says “hey this is what we need to do”. New AI tool? “Lets integrate, this AI report says it’s a good idea”. The C-Suite are so brain dead and unskilled at leadership that they just rubber stamp anything. When asking questions and poking holes in the generated material in order to establish some sort of vetted guidance and leadership direction, the IT and Leadership push back “Well what does your team think we should do?”
Yo! I’m literally asking you that question. I’m the implementer employee you’re the specialists and leaders. Did you read the report? Does it make sense? Did you see anything that seems off?
“What do you think we should do?”
This is how this stuff devovles. All nepotist C-Suites should be hollowed out and fired and we should rebuild our institutions without these useless people that can’t even remember how to run a business or make a decision 6 years into LLMs.
Not exactly. ACA imposes minimum Medical Loss Ratios. If they deny everything, the MLR would be zero and they would have to refund premiums.
The more care that's allowed, the more dollars they can keep. It's a complex optimization though; people like to pay less premiums, so an insurance company wants to price coverage low enough to attract customers and then allow enough care to keep the premiums without allowing so much as to reduce their margin.
“The algorithm cannot say no, however. If it finds problems, it sends the request for review to a team of in-house nurses and doctors who consult company medical guidelines. Only doctors can issue a final denial.”
As a physician, I’ve had to speak to these so called “peers” in a peer to peer denials with both my clinic and hospital setting. They are usually people who aren’t physicians as a first line of their defense, ie therapist, nurses, etc. This weeds out the providers who either don’t care about the patient denial and blindly accept the denial, or patient has to take matters in their own hands just to get the care they need/deserve. Or worse, in the hospital that means the patient gets hit with a huge bill (already an insane number in the US even with insurance, so don’t get me started on this) or it gets delegated to another provider who has to deal with it. Quite often patients get denied medical and rehab services, esp after something debilitating like a stroke, trauma/accident, etc. and at that point the peer to peer is to weed the provider out. Usually someone will tell the patient you’ve been denied, either go home without the services they need or you fight it.
I fight it. Can’t count the number of times I’ve spoken to someone not in the field of medicine or if they are, not my field of medicine (both Family/Hospital Medicine). Often I’m fighting with an MD or “practitioner” who is some other field like a gynecologist about hospital medicine services or rehab. I’ve even had the pleasure of talking to a physical therapist and didn’t let me get a word in as we began the peer to peer. I now start of by asking for their credentials and field of speciality and demand a peer of my field to do the denying if they are so adamant about it “not being medically necessary”.
I have so much to say and could write a book about it. I just wish I had the money and connections to actually change the state of US of Corporate Medicine.
I’ve saved a message that was reposted by Bill Ackman on dealing with denials. Thankfully, never had occasion to use it yet:
>> So, your doctor ordered a test or treatment and your insurance company denied it. That is a typical cost saving method.
OK, here is what you do:
1. Call the insurance company and tell them you want to speak with the "HIPAA Compliance/Privacy Officer" (By federal law, they have to have one)
2. Then ask them for the NAMES as well as CREDENTIALS of every person accessing your record to make that decision of denial.
By law you have a right to that information.
3. They will almost always reverse the decision very shortly rather than admit that the committee is made of low paid HS graduates, looking at "criteria words." making the medical decision to deny your care. Even in the rare case it is made by medical personnel, it is unlikely that it is made by a board certified doctor in that specialty and they DO NOT WANT YOU TO KNOW THIS!!
4. Any refusal should be reported to the US Office of Civil Rights (http://OCR.gov) as a HIPAA violation.
OCR is https://www.hhs.gov/ocr/index.html
Seems useful, but bureaucracies don't refuse, they delay and obfuscate. So before trying this I would probably seek info on how to deal with bureaucratic realities.
Example: I had an inpatient hospital stay where the payment assistant person was never available, never returned calls. Not while I was in the hospital for days, nor in the weeks afterwards.
Technically, I "left against medical advice", though the last doctor I spoke to agreed with what I was doing.
Over two days of trying to manage costs, then 36 hours of planning and asking to leave all basically got me nowhere and I had to kind of force walk out.
I wonder if there are any records of people having success with this tactic.
It certainly sounds like something that could work.
Anyone looking for a startup idea? Here you go.
It'd be pretty dystopian if in order to get medical care Americans had to pay some middle man app/service so that it can fight with the middle man the private insurance company they were paying had already inserted between them and their doctor. All if it just raises the total cost of care for the American and absolutely none of it is necessary. The actual fix is to just get rid of the private insurance company and cover everyone's medical needs under a single payer plan.
You’re describing the status quo?
Imagine this: patients buy an AI service to get approval. Insures build an AI to deny claims. 21st century AI wars..
Interesting
lmao someone in the comments works at such a company using ai to do this
https://www.snopes.com/fact-check/hipaa-medical-hack-insuran...
Well that’s disappointing…
I feel like this should really be something people should lose their license over.
By deeming something not medically necessary they are (in my opinion) effectively practicing medicine. If they aren't qualified to practice that specialty, or aren't acting in the patients interest we should really be getting malpractice suits on them and stripping medical licenses.
Legally speaking the health plan employee isn't practicing medicine in that circumstance. The requesting provider is still free to treat the patient, they just won't be reimbursed by the health plan. The requesting provider can do it for free, or the patient can pay cash. I do understand that those aren't realistic options in most cases, I'm just explaining the legal distinction.
If it's not medicine, why do they say the word "medical"? Why does the insurance company pay a doctor to do it, if they could pay someone cheaper to say those words? I'm not a doctor or lawyer, but if I had to guess, the answers are that the law requires it be a doctor exercising their medical training, while the company tries to hide behind arguments like this to get around the law.
Your guess would be wrong. At least at the federal level there is no such law. (It's possible that some states might have more stringent laws.)
https://healthlaw.org/wp-content/uploads/2025/11/Vanneman_Pr...
Okay, I was too glib, but without specifically examining state laws and the percentages of patients they affect, this is also too vague. Yes, some states do require a doctor to review denials. https://www.ama-assn.org/system/files/prior-authorization-st... Now that I see this is not universal, I concede my argument doesn't prove much outside of those states.
This seems like a straightforward argument based on existing practice of medicine laws rather than anything specific. Your arrangement with the health "insurance" company is that they will cover treatments that are objectively medically necessary. In our society, such judgements are made by licensed domain experts with a duty of care (whether a doctor, attorney, professional engineer, etc). Someone without that license (and associated duty of care) is simply not qualified to render an opinion that counts as medical advice.
The overall situation is that the insurance company doesn't want to trust your doctor's judgement [0], so they insist on getting a second opinion about the care you might need to receive. That second opinion is still being performed by a licensed doctor who is supposed to be working in your interests - it's a straightforward practice of medicine the same as if you yourself were to go and seek out a second opinion.
[0] or really they want to play good cop / bad cop - remember "your" doctor themselves is essentially also an employee of the insurance company!
It might seem that way to you but that legal theory hasn't succeeded in court. Feel free to try again, though. I'm not claiming that the current legal situation is a good one but any significant change will require an Act of Congress.
> Legally speaking the health plan employee isn't practicing medicine in that circumstance
Feels like convenient lawcraft to wash the health plan employee’s hands of liability. I’m sure the prevailing popular opinion would be that this is practicing medicine.
If "convenient lawcraft" is the new slang for "words have meanings" then absolutely. Insurance company employees talking about insurance is practising insurance. Nobody wants them to practice medicine, the question is whether they are they going to hand over the money or not. Money is not a form of medicine, even if the person deciding where it gets sent is medically qualified.
Although on the words having meanings front, whatever is going on here is pretty clearly not insurance at this point; it'd be better just to honestly call it welfare rather than force people to redefine the word 'insurance'. It is hard to talk to people in the US about actual insurance now because they don't have a word for it any more. Politically redefining 'medicine' too would be a mistake, important conversations will become incoherent.
“X is or is not medically necessary” seems like a decision a medical professional should determine, no? Subject to licensing and liability?
If I build you a house and tell you the roof trusses aren’t necessary, you’d be pretty peeved.
But you didn't build my house, and if I literally get angry with you because I think you should abandon your legal shenanigans, admit to being a builder and take on legal liability for the flaws in my house that would confuse you because you are, in fact, probably not a builder and certainly not the person who built my house.
The issue with teeray's original comment is that they are saying someone who isn't practising medicine should be considered to be a medical practitioner. In fact, in this context, teeray is annoyed with them specifically because they didn't practice anything. Your analogy became irrelevant the moment it involved you doing anything.
> “X is or is not medically necessary” seems like a decision a medical professional should determine, no?
No, that is ridiculous. If I think I need to go to a hospital I'm going to go to the hospital. I don't need qualifications to work out something is medically necessary. I'm unlikely to be involved with the medical industry at all unless I've already personally determined it is medically necessary that I consult a doctor.
As a rule of thumb, patients have the final word on what they actually consider necessary. Literally anyone can have an opinion on the subject. Like, for example, an insurance worker. If the patient or the doctor is of a different opinion then they can go pay for the work themselves. It isn't that uncommon to have to go through 3 or 4 medical professionals to find one who agrees that work is necessary; I have a cancer story like that in my family.
I think the right analogy here is that I'm a renter and the person who built my house (builder) is different from the person who paid for the house (landlord). The builder said the roof needed trusses but the landlord decided they weren't "structurally necessary" and refused to pay for them. The roof collapses on me...does the landlord escape liability?
Maybe an even better analogy is that I live in a rented home and after I report some weird respiratory issues, an inspector finds black mold all over the place. The landlord refuses to fix the issue because "black mold is totally fine, bro" and I get really sick. I could maybe have moved out, but I kinda feel like the landlord is going to have a bad time here.
That analogy would make sense if there were a credential that one had to have to make an authoritative decision, and the people making the decisions lacked the credential.
Words do in fact have meaning, which is why if you want your decision to be viewed as an insurance one rather than a medical one, you probably should avoid using phrases like "medically necessary" as justification for your decision to approve or deny insurance coverage. Using that phrase strongly suggests that while the ultimate decision was about providing or denying insurance coverage, what informed that decision was a medical determination about the actual necessity of the procedure. If you want to keep the decision firmly in the insurance realm, better considerations to mention might be expected lifetime payouts, shareholder value, and "because fuck you that's why".
> Nobody wants them to practice medicine, the question is whether they are they going to hand over the money or not.
This doesn't make any sense. They're not handing over money for fun, they are supposed to pay for the medical services the insurance is supposed to cover. And the only person qualified to decide if that medical service is appropriate is a doctor who specializes in the field of that specific area.
If you aren't legally qualified to make medical decisions then you are not allowed to use terms like "medically necessary" in your decisions. That our judges haven't bothered doesn't protect us from this obviously illegal abuse is just one of a million of illustrations of how poor our legal system is.
> The requesting provider can do it for free, or the patient can pay cash.
That might not be actually an option. Well the provider can do it for free, probably; but they may not be able to accept money for care that was denied coverage. A Medicare provider can charge patients for things outside the scope of Medicare, but generally can't charge for things in scope but deemed not medically necessary: ex if Medicare says 6 PT visits for whatever and you would like to have 8, you can't pay the provider for two more; you'd have to find a non medicare provider or come back with a fake moustache.
I had to take my kid to an express care doctor in the US. My wife had the insurance cards and was on travel. I said I would just pay cash. They said because I had insurance I was not legally allowed to pay cash.
There is no such law. But many employees in healthcare provider organizations are ignorant about the law and just repeat what someone told them.
Sorry, but this feels like a lot of weasel lawyer doublespeak nonsense. Denying insurance coverage for a specific procedure for a specific patient based on whether you think that procedure is necessary is absolutely making a specific medical decision that will impact the treatment of that patient. The idea that this does not constitute practicing medicine is absurd and the fact that the patient can potentially still obtain treatment seems immaterial. A doctor who flat out told a patient a certain procedure wasn't medically necessary could be legally liable if that wasn't accurate, so how is the same not true of an insurance company who has far more impact on the ability of the patient to obtain treatment?
The reality is that this is the insurance companies trying to have their cake and eat it too. They actually want to be making a medical decision in denying coverage since it gives them a legitimate reason to do so, but want to avoid any liability if that decision was wrong.
Don't be sorry.
Sounds like a massive gap in the legislature. Someone should fix this loophole.
"We won't pay you" is a business decision. "Not medically necessary" is a medical opinion.
Right? Lawyers can get into deep shit if they misrepresent their ability to well, represent a client on a case outside of their area of competence. How are medical professionals that often won't even tell you what they think about a test result and refer you to a specialist to actually get a diagnosis able to ethically represent what a patient actually needs?
As someone who needs expensive medication, thank you. I appreciate it.
2 questions:
1. It’s unpaid, short answer. Not part of your visit, usually a visit code is just one time based code for everything you provided and maybe a procedure if you did something like ear flushes, wart burning, quick wound fixes, etc. Long answer below.
If there’s a billing code for it, I’m not aware of it and frankly I shouldn’t have to use it. For providers, it’s part of their “administrative time” which used to be a full day of catching up. In most hospital or insurance-owned clinics, that admin day is gone. You now do this during your lunch break and anytime you can squeeze a phone call. Fun fact, in the hospital, these peer to peers are at the mercy of the insurance company and only give you 24-48hrs to do it, so the hell to the overworked provider and their schedule, again this is exactly what they want. A overworked provider who doesn’t have the energy to fight. Providers are so overworked, they no longer can you catch up on charts and hence why the patient-provider relationship has eroded and become so cold when you see your provider just typing away instead of focusing on you.
2. Fight. Appeal your denial. Make sure your provider does the same. Follow this: https://news.ycombinator.com/item?id=48126000#48128288 Can’t speak to all providers, but most of us are good people trying to do their best to help people. Few bad actors out there give us a bad name, but every field has good vs bad. It’s not right to make hasty decisions based on legitimately a few bad providers out there because of their greed, corruption, fraud, etc and lump everyone to prove they’re not fraudsters. Your basic primary care physician/NP/PA or surgeon isn’t the problem. It’s the conflict of interests of the health care industry, private equity groups, etc who create these issues, exploit the system and make it a breeding-ground for fraud/etc then complain that it needs to be fixed with more middle men.
It's unpaid time, but that'll just get factored into the rates charged for billable things like appointments and procedures.
It's like any time spend on billing or administrative work, it's baked into the costs. (Administrative costs is a big component of rising healthcare costs.)
Depending on the issue, the patient may be needed to provide supporting paperwork, like previous diagnoses or treatment for providers. Other than that, not really, short of taking legal action.
First off, thank you for taking the time to do it. I know most people don't agree on many things today, but most Americans agree the current system is stacked against them. Not to search very far, I have good insurance and I still have to deal with things that border on criminal.
Two, that book may be a good idea:D
This is good to hear. My mother was a PA for a private practice and also would often call the insurance providers to challenge denials, often from people far from the relevant specialty. By her accounts she was usually able to reverse the denials.
seriously consider that book if you can fill it up with these types of stories. A book like this could be a huge hit, get this issue even more spotlight and maybe some fixes.
> I just wish I had the money and connections to actually change the state of US of Corporate Medicine.
It will never happen.
This is largely what at least half the country wants.
“If I need to take a drug test to earn a check you better take one to get welfare.”
I’ve heard a working class person say this. I guarantee you the people who own defense contractors, the real welfare queens don't need to take a drug test.
Likewise, the horrific thought that someone unworthy might get free healthcare is appalling to half this country. They’d rather go without just to ensure *those people don’t get free healthcare.
This country doesn’t want to be fixed. It wants RFK to tell you to treat Autism with raw milk and sunshine.
Nothing much to do but try to find a civilized place to live
As a random person, I'm becoming convinced that the first stone to get things rolling is full price transparency at all scales.
Definitely write to NYT or Guardian or Atlantic about this stuff! Journalists probably have a ton of info on how messed up the system is, but if feels like you have data-backed opinions and documentation to remind yourself of examples!
Another idea: why can't these claim reviewers pass some sort of government or medically-licensed authorization to do this work?
In the early 2000s I got a job right out of highschool working at a Blue Cross Blue Shields call center. I thought it was going to be customer service but it was insurance claims. Training was supposed to be 6 weeks but they pushed me live after just 2. I had no idea what I was doing. After floundering for a couple weeks trying to learn to basically be a fuckin doctor, I just started approving everything. "Patient needs emergency surgery for X" "Approved". The whole experience was completely insane.
“ I just started approving everything. "Patient needs emergency surgery for X" "Approved".”
Did they ding you for bad performance after a while? Your job was to maximize denials, not approvals.
I didn't stay long enough to find out, but yeah, they probably would have. The pressure was definitely to default to deny it. That's what the run books (very few) were defaulted to. It was really just a bunch of expendable people to deny claims. The turnover was wild for obvious reasons.
That was the correct course of action.
Thank you for your service!
Physician and Hospital resources is a real zero sum game, how do you fairly regulate the medical landscape so those who's lives will benefit most from a procedure will receive the procedure?
Who decides this? You?
Should we allow everyone in the world who needs a procedure to receive one free and get ahead in line for Americans who need the same procedure? That's what the current climate looks like with unbridaled immigration under progressives.
These are hard questions. What's the answer?
Why not pay for these things out of taxes? I don't think you'll be so quick to defend the system if you ever find yourself needing care beyond a checkup once a year. It's designed to make the insurance carrier money by constantly having little costs slip through the cracks that should be covered. Get a dental checkup? Sorry one of your X-Rays wasn't covered but the other ones were. Now you get to spend hours fighting for a $13.00 cost. Oh you're at the max for this service for the year because we accumulated the estimated cost when you started calling doctors about what the after-insurance cost will be. Wait a minute this out-patient consult is actually a surgery because you saw a surgeon so it must have been a surgery, and it's not medically necessary to have the surgery without the consult.
Because there are a finite number of doctors and hospital beds and you can't create either by throwing more money at the problem. You didn't actually read the content did you
You can most definitely create both hospitals and doctors using money.
The doctor has already managed to find time for the service - she’s seen you. Potentially even done the procedure. The hospital has made room for you. The resource is already consumed by you, like a restaurant meal. The question is who is picking up the check, when you already have a subscription service paid for.
The service is not “free healthcare for any procedure ordered by a doctor all the time without limits”, they have the right to refuse something they feel is unnecessary
Why isn’t it “any procedure performed by a doctor all the time with no limits”? Do you think there’s a cabal of doctors doing medical procedures for funsies? And that if such a thing did exist, it would be a bigger problem than some company who has never seen you, never examined you, and you’ve already paid money to, denying the claim because they judge it “unnecessary” when the doctor who did see you claims it is?
And the doc is also spending a shocking amount of their time on the phone yelling at the insurance company flacks, as a bonus.
Every other country seems to solve it
I guarantee you that the insurance company has zero clue or consideration for any physician and hospital resource constraints.
Gating access to medical care is the job of the patient's PCP and or other doctor. If the care is truly, meaningfully rationed (like transplant organs and blood banks), there are triaged priority lists managed by medical organizations.
These are actually pretty easy questions as long as you’re not an asshole.
Are they? I would love to hear how you would solve those problems rather than make a blythe, thoughtless remark
Dang, can we take a look at this one please? It’s not a productive, helpful, or interesting comment. Thanks!
Medicare has a similar issue. When you sign up at 65, you have to make a first big decision, Traditional Medicare (yay!) or private Medicare Advantage (boo!).
Traditional Medicare consists of Part A (hospitals), Part B (doctors) and Part D (drugs). Part A+B don't cover everything so you have a Medigap plan. I have Plan G which has very little paperwork. All up, I spend about $400/mo and I'm very happy with A+B+G+D.
With Medicare Advantage you sign over your Medicare rights+benefits to a private insurer. This may save you some money, especially early on. In fairness, not really a lot and the $0/mo plans are a scam. With Medicare Advantage, you will then have to argue with an insurance company for the rest of your life. You'll have to deal with preauthorizations and a restricted network.
With Traditional Medicare, what's covered is spelled out pretty clearly ahead of time. Docs know it. You know it. There's literally an app for that. With Medicare Advantage, medically necessary is at the discretion of the private insurance company.
Here is the scenario from a relative: he had a heart event which ended up needing a stent. He had to argue with Kaiser while this was going on. Kaiser is 240,000 people. He is one.
Medicare Advantage is very profitable.
It is possible to switch back from MA to TM which really revolves around your Medigap plan. You are guaranteed issue for Medigap plans for about 3 months before/after you turn 65. After that, you will have to undergo medical underwriting.
Yes.
"Medicare Advantage" = HMO. All the usual HMO problems.
The best Medigap plan is Plan F, which is no longer available to new subscribers. "Discontinuation of Medicare Plan F was a strategic decision aimed at promoting responsible healthcare spending and ensuring the financial sustainability of the Medicare program." It covers just about everything Medicare doesn't pay, including the various deductibles Medicare has. If Medicare covered Medicare's part, the Plan F provider has to pay their part. They don't get to question it. I don't even see hospital bills, just statements that it's been paid for.
Plan G is one step down from that.
MA is not necessarily an HMO. It's up to the operator. Some are HMOs, some are PPOs, some are neither.
> "Medicare Advantage" = HMO. All the usual HMO problems.
Not on Medicare, but I switched to an HMO over 10 years ago at work, and have never been happier.
There are fantastic and crappy PPOs, and fantastic and crappy HMOs.
I’m 40, on Social Security Disability Insurance and recently became eligible for Medicare.
After years on Kaiser because of familiarity, when I became eligible for Medicare, I had to make a choice between original Medicare or Medicare Advantage.
It’s incredible expensive to buy into adequate coverage if you’re under 65 and on disability and want original Medicare, but after the mixed experience I had with Kaiser, I wouldn’t have it any other way.
As I have some serious health conditions, I signed up with Plan G Extra and a high coverage tier for Part D. It’s going to cost about $1300/mo plus an additional $202.90/mo for part B, but it’s better than having to worry about future health issues putting me in financial ruin.
Nice to preserve choice being responsible for at most a $283 deductible per year on top of the monthly cost.
I had a 3 day hospital stay in December 2024 that was $75,000 and I didn’t have to pay for it, so it was worth it to have good coverage.
The theory behind Medicare Advantage is that it would cost the government less than traditional Medicare because the private insurer would be more efficient. Guess what happened.
I think the logic of running a more efficient company is true - they are making more money operating them than the government can/is.
The insurers are such behemoths and so largely vertically integrated it is controlling the system instead of improving it.
Notice how there is rarely ever any new competition in the health insurance space to drive down pricing.
Well the only ways to make any sort of insurance pool (whether it's run by the government or a private organization, for or non profit) more efficient is to deny more payouts or aggressively select for a less risky risk-pool. Medicare insures everyone over age 65, so the second option doesn't work. You can't just leave half the elderly uninsured because they're fat and likely to run up $100,000 in knee replacements. So you have to deny more claims.
Insurance is brutally simple. Money in, money out. Trying to make your back office more lean with tech and automation has extremely limited returns, because the back office is such a small portion of the total cost structure. 95-100% of costs in any given insurance operation are claims. So everything to do making things more efficient and reducing costs has to do with reducing claims.
It's not that simple. Something like a quarter of all healthcare procedures aren't justified on an evidence-based medicine basis and do nothing to improve patient outcomes. Higher quality care actually costs less. But there's a huge amount of waste and mismanagement at all levels of the system.
I agree and making insurance more efficient involves aggressively policing that activity and denying associated claims.
In fact, MA costs the government more per person than does TM. MA may have been lobbied for as a cost saving measure. It is, in fact, a profit center for insurance companies.
https://www.kff.org/medicare/higher-and-faster-growing-spend...
Ah, yes, nothing cuts costs like, er, inserting a middleman?
I've no idea how anyone ever thought this could work.
If you look at any health insurers profit split right now they are making all of their gains on medicare advantage.
I worked at one of the companies mentioned in this article for a brief period of time as a junior employee.
The entire framing on the inside is about helping the industry adhere to evidence-based medicine and reign in the skyrocketing costs of healthcare.
The analysts would periodically share results of their anomaly detection, finding physicians who order MRIs at rates multiple standard deviations above the average physician, and further find that these physicians own their machines.
There are a lot of examples of this kind of fraud. There’s also bloat and over prescription as doctors are terrified of malpractice and have patients demanding tests or procedures they read about online.
When I was working in the company, I really felt like I was helping reign in unnecessary costs. We had many people reading medical literature, consulting with other physicians, scientists and others to create guidelines that form the basis of the pre-approval decisions. It felt like we were centralizing all of that knowledge and “providing it” as a service to society.
One day, a brave junior employee asked the company CFO at a lunch and learn, “If we’re doing such a great service for patients, why is it the insurance companies paying us, instead of patients?” The CFO gave one of those replies that is only memorable because of how fumbled it sounded.
I realized quickly after that what purpose the company really served and how the incentives created a serious conflict of interest. But my time at the company has convinced me to this day that there are no “innocent” parties in the payer-provider-patient triangle. Every party involved has their own set adverse incentives against each other and the balance of power swings like a pendulum with every merger, acquisition, or regulation passed.
> are no “innocent” parties in the payer-provider-patient triangle
not the patient?
No. Lots of problems with patients wanting things they've heard of. Think all that drug advertising is for nothing??
The worst part, simultaneously soul crushing and apocalyptic rage inducing is that we get these outcomes after spending more per capita on healthcare than pretty much any country on the planet.
Worse, we spend more in tax dollars on it than any other country total, and then add on the private spending on top. We do the worst of both worlds.
https://commons.wikimedia.org/wiki/File:OECD_health_expendit...
(And we’re middling in outcomes!)
Yeah because we consume way more than other countries
Do we consume more, or are we running the price of everything needlessly higher with a goofy setup?
Americans are not inherently three times as sick as Australians.
Yeah they are. Americans engage in more unhealthy eating, crime, and drug use than Australians. It’s very easy for me to believe that they’re 3 times as sick.
Australia is very close behind the US in obesity and illicit drug use.
Side note: I'm an Australian citizen, living in the States.
An Australian hospital doesn't need a billing/collections department and the docs don't sit on appeals calls with insurance; when my wife broke her foot visiting, they basically didn't know how to bill her (for surgery and three days in a ward!). My son needed a badly ingrown toenail treated on a separate visit there last year; they just treated it and sent us on our way, no charge, despite his being a tourist.
I didn’t say obesity, I said unhealthy eating. Those aren’t the same thing.
I straight up don’t believe the drug use one, we have way more fentalyl deaths than you and it’s not even close.
You didn’t address crime. We have much more of it. More gun ownership and gun usage as well.
I’m not quite sure what this anecdote has to do with my comment.
> I didn’t say obesity, I said unhealthy eating. Those aren’t the same thing.
Australians eat a substantially similar diet to Americans, and have similar health issues (obesity, heart disease, etc.) as a result. They are deeply related things.
> I straight up don’t believe the drug use one, we have way more fentalyl deaths than you and it’s not even close.
Gee, I wonder if not having healthcare (including access to things like therapy and rehab) might drive up drug death rates.
> You didn’t address crime.
Sure; you didn't address how it's responsible for 3x the healthcare costs.
> Australians eat a substantially similar diet to Americans
Sorry I don't believe this
> Gee, I wonder if not having healthcare (including access to things like therapy and rehab) might drive up drug death rates
Lol, yeah that's why we have so many fentanyl addicts, the lack of therapy, I'm sure that's it
> Sure; you didn't address how it's responsible for 3x the healthcare costs.
Gunshot wounds obviously, we have way more guns and gun crime than Australia
> Sorry I don't believe this
Facts don’t require your belief. 30s in an Australian grocery store will have you feeling quite at home.
> Lol, yeah that's why we have so many fentanyl addicts, the lack of therapy, I'm sure that's it
Read again. You cited their deaths, not their drug use. Australia has plenty of drug users!
> Gunshot wounds obviously
You think the US spends 2/3 of its healthcare spend on gunshot wounds, accounting for the difference?
To quote you, “sorry, I don’t believe that”.
Feel free to cite something that proves that Australian diets are similar to American diets. I don’t believe claims made without evidence.
Deaths are pretty much 1:1 with drug use. Us having more fentanyl deaths mean we have more fentanyl users. Feel free to cite something that proves that Australia has the same amount of drug users as the United States.
It’s a contributing factor. Americans consume healthcare at much higher rates for many reasons, some of which I listed above. I’d fully expect Americans to pay more when they consume more.
> Feel free to cite something that proves that Australian diets are similar to American diets. I don’t believe claims made without evidence.
https://www.abc.net.au/news/2010-04-14/australian-diet-worse...
https://www.nationalhogfarmer.com/market-news/study-finds-am...
https://www.youtube.com/watch?v=omT2ENVQziM
https://www.theguardian.com/australia-news/2025/nov/19/austr...
> I don’t believe claims made without evidence.
You're certainly making a few of them!
> Feel free to cite something that proves that Australia has the same amount of drug users as the United States.
https://www.aihw.gov.au/reports/illicit-use-of-drugs/illicit...
"According to the 2022–2023 National Drug Strategy Household Survey (NDSHS), an estimated 10.2 million (47%) people aged 14 and over in Australia had illicitly used a drug at some point in their lifetime (including the non-medical use of pharmaceuticals), and an estimated 3.9 million (18%) had used an illicit drug in the previous 12 months."
https://drugabusestatistics.org/
"Among Americans aged 12 years and older… 70.5 million or 24.9% of people 12 and over have used illegal drugs or misused prescription drugs within the last year."
That's broadly quite similar.
> Deaths are pretty much 1:1 with drug use.
You can absolutely reduce drug death rates with safe injection sites, needle programs, narcan distribution, safety education, substance abuse treatment, etc.
> Americans consume healthcare at much higher rates for many reasons, some of which I listed above.
Americans pay substantially more money for the same procedures and medications. Again: THE EXACT SAME THING; no difference in amount or quality consumed, just drastically more money going into corporate pockets.
https://nypost.com/2025/08/07/world-news/doctor-exposes-shoc...
"Atorvastatin, a medication to lower cholesterol and prevent cardiovascular disease, is priced as little as A$6.70 for 30 tablets in Australia, compared to US$2,628 for Americans."
"However, the biggest shock was Sofosbuvir, which treats hepatitis C, with a 12-week treatment roughly costing an eyewatering US$84,000 without insurance and discounts. Meanwhile, it costs about $31 for a packet of 28 in Australia on the Pharmaceutical Benefits Scheme (PBS)."
Yes, but there is a major gotcha in fixing this.
It "costs" much less--because in reality we end up footing the R&D bill. The drug companies tolerate sales to the UHC countries so long as it's above their marginal cost. If US customers were also paying $31 for that Sofosbuvir there's no way the company would recoup costs and they would not develop it.
Fixing this will cause big shakeups in the universal coverage systems and thus big political shakeups. It should be done, but gradually.
I will also say the comparison is false--my wife is on Atorvastatin, it's even less than what you are quoting for Australia. You're comparing the brand name with the generic.
sources please
Don’t have any. Not concerned with whether you believe me or not
Two hours ago you posted "I don’t believe claims made without evidence", lol.
https://news.ycombinator.com/item?id=48135626
A family member recently got a routine physcial blood test panel taken. The company made 3(!) separate overcharge billing errors associated with this one screening. Their doctor had to be pulled in and wasted a considerable amount of time clearing this up, doing stuff like affirming to their support that the documentation from their own front desk was accurate. Maybe for every $100 of doctor time they waste they collect $101 from patients who give up. No wonder its a black hole of money.
... and that money isn't going to insurers.
... nor the providers.
In fact it's overwhelmingly going to the providers.
https://nationalhealthspending.org/
It's going to the administration overhead. If you have to document everything and argue for every medical procedure and deal with 20+ different processes for filing claims then it takes time. And, as a provider, you have to pay someone to spend that time if you want to get paid.
It doesn't help that our healthcare billing systems are so outdated and broken. I once had a doctor visit denied with the reason code that it should charge the other insurance (for people on multiple plans). I was only on one plan, but my wife was on two. The doctor and I went through all the paperwork - my name was right, my birthday was right, my policy number was right and when I got notice of the rejection it had my name on it. Eventually we traced it to an error - not in my insurance company, not in the company that handles claims in this areas for my insurance, but instead in some middle-man company that was responsible for transferring claims between the two. Nevermind that all three companies claimed to be BlueCross BlueShield. This took over a year to resolve.
No it's not. There is absolutely no way to get from $360B of insurer admin and net cost of insurance to $2.5T --- two point five trillion --- in practitioner costs on paperwork overhead. That is not a plausible argument.
The numbers here are not close. They're stark.
https://news.cornell.edu/stories/2011/08/us-health-care-cost...
> A new study finds that the extra time and labor physician practices spend on interacting with insurance companies and government entities cost U.S. physicians $82,975 each per year, while doctors in Ontario spent $22,205.
> Canadian physicians follow a single set of rules, but U.S. doctors grapple with different sets of regulations, procedures, requirements, formularies and forms mandated by each health insurance plan or payer. The average U.S. doctor spent 3.4 hours per week interacting with health plans; Ontario doctors spent 2.2 hours. The bureaucratic burden falls heavily on U.S. nurses and medical practice staff, who spent 20.6 hours per physician per week on administrative duties; their Canadian counterparts spent only 2.5 hours on paperwork.
All that falls in your $2.5T bucket. And their cleaners, HR, etc. And insurers have had 15 years of innovation since that study.
You haven't done the math here. Multiply the numbers out. This is what I'm talking about. How are you supposed to engage with these topics if you're literally recoiling from 7th grade arithmetic? Congratulations, taken on your own terms, you just found 3.6% worth of savings from practitioner costs.
My local grocery store wouldn't even bother issuing a coupon for that small a discount.
This is one example of an aspect where insurance causes costs that are not directly attributable to the insurer in your numbers.
This isn’t seventh grade math. This is kindergarten level cause and effect.
Yes, as I said, if we accept your claim at face value, that every dollar of American practitioner-side insurance overhead --- not the delta from Canada, but every single dollar of it --- is mis-spent, you managed to identify 3.6% of the waste in the system. Congratulations.
I said earlier we'd gone round-and-round on this topic before, and I was a little burned out on it, but I didn't expect you to refute your own argument like this. I'm glad we gave it another run this time! This is a great statistic; I'll be using it elsewhere. Thank you.
Insurance has more than one way to run the costs up; this is but one of them. Weird rebate deals with drug manufacturers. Vertical integration. Buying practices and paying them higher rates.
> I was a little burned out on it
I just did my taxes and am a little burned out by the $49k in healthcare expenses I got to deduct on them.
The reason it's going to providers is because US healthcare is extraordinarily inefficient. Providers spend too much time doing, well, everything. From admin, to medical records, to documentation. Very little of their time goes to actual, direct care and decisions around care. You can talk to a doctor about this if you want, they'll all tell you the same thing.
Even surgeons. Ask a surgeon how much time they spend in the OR. It's less than you think.
https://sph.brown.edu/news/2025-11-10/unitedhealthcare-optum...
> Today, many of those practices have been bought up by large corporations, including hospitals, private-equity firms and even health-insurance companies. It’s a shift that not only has changed how money moves through the health care system, but may also be helping some insurers boost their profits, according to new research published in Health Affairs.
> A study from researchers at Brown University’s Center for Advancing Health Policy through Research and the University of California Berkeley found that UnitedHealthcare, the nation’s largest health insurer, pays doctors who work for its own physician network, Optum, more than it pays independent practices for the same care.
This isn't a response to anything I just said. I really don't understand why people collapse into all this handwaving when people point out the obvious: the money in our system is going to providers, and, in particular, it's going to practitioners.
The insurers are buying the practices so they can eat at both sides of the trough.
(And the independent practicioners are having to use a significant portion of the money they take in to… fight the insurers!)
What difference is that supposed to make? The money is still going into the pockets of practitioners. And: no, the claim you're making here about practitioners fighting insurers: closer to the opposite thing is true.
The idea that the problem with our system is health insurers is just slopulism. We have grave problems with our system! But they start with the providers, where the majority of all the funding in our system goes, not to the scapegoats they've stoop up in our insurers. The distinction is vitally important, because the most popular answer to this problem is to extend Medicare to everybody, and Medicare is just as victimized by this as everything else is!
We pay doctors too much, and we artificially restrict the supply of practitioners. Those doctors routinely overprescribe. Every other problem in the system is marginal.
"The money is still going into the pockets of practitioners."
And by inflating that amount...
> Using newly available federal price transparency data, the researchers found that UnitedHealthcare pays Optum physician practices about 17% more than non-Optum practices in the same region. In markets where UnitedHealthcare holds a large share of the insurance business, that difference was even larger, up to 61%.
their capped-by-law 20% cut of premiums goes up, too. "Oh, those mean old providers we own charge so much! We have to raise premiums again!"
Show me the more recent NHE table where this effect shows up and I'll be ready to have the conversation, but right now this seems like a dodge. Whatever effect you're describing, if it's material, has to have started after the NHE data I just posted, from 2023. I don't remember thinking that the health system in 2022 was good.
Fun thing about the NHE: you can project it as far back as you want. The data is there.
> Whatever effect you're describing, if it's material, has to have started after the NHE data I just posted, from 2023.
What? Insurers have been playing this game far further back than 2023.
If an insurer doubles the time a doc has to fight over denials and has to hire extra billing staff to assist, where do you imagine that cost shows up?
I feel like we've been in this argument before, and I like you just fine as a commenter, but do feel like you're tying yourself into knots to avoid a simple conclusion plainly supported by the data. I didn't post a trend story about what companies are doing or who they're acquiring; I posted the macro NHE table from last year. It simply refutes the argument you're trying to make.
> I posted the macro NHE table from last year.
Again: how will the “insurers force provider costs up” show up in said tables?
It’s caused by the insurer. It shows as a provider’s cost. But it doesn’t mean said doc is making any more money at the end of the day.
The insurer does, though! Their 20% cut got bigger, and the "computer says no" denials are cheap!
TL;DR: Where in your link does "doc spends needless hours on phone fighting insurer" show up as a cost?
It literally breaks practice and net cost of insurance out!
> It literally breaks practice and net cost of insurance out!
But it's not a "Cost of Health Insurance" item. It's an expense at the practicioner level! They have to factor that non-billable time into what they charge for the procedure!
Read their definitions: https://www.cms.gov/files/document/quick-definitions-nationa...
"Administration" is the insurer's side of it.
This is special pleading.
Oh, now who's dodging?
If an insurer manages to double a doctor's administrative costs for billing/appeals/etc., where does it show up in your tables, per your link's PDF of definitions?
You have no evidence for this argument. It's just vibes. The numbers here are stark. It's not like it's close, between providers and insurers. Insurers are almost literally a rounding error.
You asserted "the macro NHE table from last year… simply refutes the argument you're trying to make", but that claim is false. You are welcome to answer the question about where "doc spends two hours on phone arguing with UHC" falls in the expenditure list; it's not insurance, but it's caused by it.
> Insurers are almost literally a rounding error.
Again, the argument is that the raw cost of health insurance does not reflect its externalities imposed on the other items in your list; that insurers drive up hospital and practice costs, as they have to staff up enormous amounts of staff and expensive physician time to deal with the insurer.
$360B in admin/net cost of insurance. $2.5T in practitioner costs.
> $2.5T in practitioner costs.
Some of which is those practicioners' admin cost from dealing with the insurers. (And, you know, doing the actual work.)
Denials are nice and cheap. Fighting them is not.
You stated this claim upthread, for the record, and tracked down an actual Canada vs. US statistic on this, which turned out to account for roughly 3.6% of total provider inpatient/outpatient expense.
In 2011, when my premiums were $1600 a month. I dropped my plan when it hit $4900/month to go on my employer’s crappier plan.
And as noted in that other conversation, this is one aspect of many. UHC isn’t pursuing vertical integration for funsies.
That's not an argument; it's just vibes. Whenever we get actual numbers to look at, your arguments fall apart.
Again, I want to be clear: I'm not here to defend the American health system. It's a disaster. It's just clear to me you don't have a bead on why that is. (The answer is artificial scarcity of practitioners, overprescription, and lack of price transparency).
> That's not an argument; it's just vibes.
So is “insurance doesn’t have any externalities that might hide in my very broadly categorized numbers”.
Non-falsifiable argument is non-falsifiable. I could literally present you evidence that 2.2T of our medical expenditure is due to a price-fixing ring in syringes, and you'd still be able to use the same argument.
> In 2022, Carelon settled a lawsuit for $13 million that alleged the company, then called AIM, had used a variety of techniques to avoid approving coverage requests. Among them: The company set its fax machines to receive only 5 to 10 pages.
Who are the people who sleep at night after designing these policies?
They sleep very soundly on a bed made of money.
There is an unlimited pool of people without empathy. Never forget that.
Patrick Rucker, one of the authors, spent time at our company, Claimable, last fall so he could investigate this issue further. Claimable is a startup where we leverage AI to help people appeal their health insurance denials. Ask me anything, I work in this space every day.
https://www.getclaimable.com/
The CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F) is driving some industry improvements in this area and there's a lot of opportunity for technologists to help implement it. While the rule mostly only applies to Medicare Advantage health plans, many payers are voluntarily implementing the same HL7 Da Vinci Project Prior Authorization Burden Reduction APIs across all lines of business. These APIs give providers standard ways to check whether prior authorization is required for a plan of treatment, find out exactly what documentation the health plan requires, and then submit the prior auth request. This won't solve the problem of improper denials but will at least reduce delays and errors.
https://www.cms.gov/priorities/burden-reduction/overview/int...
I understand that nobody likes to talk about setting this threshold, but it's not some kind of unique feature of the American healthcare system. I think the article raised some reasonable concerns about EviCore, but it would be a lot stronger if it did more to contextualize denials in terms of the other quadrants (correct approval, correct denial, incorrect approval, incorrect denial). It would also be interesting to compare those statistics across types of insurers (for-profit, not-for-profit, and government).
The threshold is not unique.
Having several layers of private, for-profit companies incentivized to deny deciding that threshold is fairly unique.
I am a member of a community that had an extremely high rate of HIV infection, and watched dozens of people die, in the 1990s. It was pretty awful.
I found out that many insurance companies deliberately delayed approving procedures, in the hope that it would kill the patient.
back then, there was no AI. The decisions were made by humans.
Sometimes, people suck.
There's entire companies (example: MedExpert) whose clients are health insurance companies whose job it is to re-route physician and patient requests for expensive necessary treatment to cheaper alternatives: https://www.medexpert.com/results/
When they can't completely deny they delay and/or set up burdensome hoops for the patient to jump through before they will qualify for treatment. It's literally their business model.
They even brag about it on their website! > Reduced inpatient hospital admissions by 15% > Reduced use of skilled nursing facilities by 15% (because we won't approve them for nursing care!) > MedExpert clearly reduces rates of unnecessary elective surgery.
If you want entertainment go to their glassdoor reviews and sort by lowest ratings: https://www.glassdoor.com/Reviews/MedExpert-Reviews-E777566....
The world needs more Luigis.
Even if you get an approval for an expensive specialty drug, good luck.
I had the insurance written approval in my hand while the pharmacist told me it was being rejected for needing prior approval. The insurance phone rep said they could find no record of any REQUEST, let alone approval, for the drug.
So I go to the state insurance regulator. That does at least light a fire under their arse. They can't claim it's not medically necessary when I already have their approval.
During the complaint process I learn: - Front line reps don't have any access to any pre-auths. You need to talk to a supervisor. They ADMITTED the system is by design obstructive. - The person who entered my approval did it wrong and did not follow the SOP to run a test transaction that would have caught the error.
They then submit their reply to the regulator leaving out all of the above and blaming the pharmacy instead. I follow up with the regulator pointing this out. I have voice recordings.
Regulator closed it as resolved.
I'd class action their butts if I wasn't still exhausted by the experience two years later.
Evilcore is a fitting name.
> Connecticut’s Insurance Department recently reviewed EviCore and Carelon. It found no problems with Carelon. EviCore was fined $16,000 this year for more than 77 violations found in a review of 196 files.
$16k is such a low fine that it’d be funny if it wasn’t so sad. fines should be increased to actually represent a threat to the company - maybe as a % of yearly profit?
our system is so fucked dude
Yes trying to read that article my brain refused to parse "EviCore" as anything but "EvilCorp". Every time.
Multiplier times price of necessary care denied? One can dream.
How do you get accountable people in charge of healthcare policy?
By playing Super Mario brothers with those that are not?
Medically speak, I'm sure we can all find several businesses that arn't necessary.
Mark Cuban has a neat startup to appeal health insurance denials www.getclaimable.com/
When life is controlled by algorithms.
America cannot, as a country, discover a reasonable approach to managing health care costs because Americans do not have a sufficient core set of shared political values. The solution is to end regulation at the federal level, and allow the states to determine what regulations they may deem appropriate. As a New Hampshire libertarian, I do not want Californian progressives telling me how our state must manage health care spending, and I am sure they feel the same way about me.
I think the vast majority of people agree on the generalities and care enough about solving the issue to be able to come to an agreement on the particulars. The problem is that the people who get rich off the current system won't agree to any solution that reduces their profits, and have thus far managed to fillibuster attempts at such a solution through a combination of buying politicians and propagandizing certain segments of the population into rejecting solutions that would benefit them.
I'll accept your first sentence for the sake of argument. You are still better off with a localist / federalist approach, because state governments are much less vulnerable to corruption and bribery. It is far more economically efficient for the bad guys (whoever they are in your view) to bribe a few DC legislators than dozens of state politicians in places like Montpelier and Hartford. Centralized, unaccountable power in DC means that when big rich corrupt companies bribe the right people, they can force the entire country to followed their preferred policies. A good example is how Purdue Pharma bribed the head of the FDA to approve OxyContin, leading directly to the opioid crisis.
> It is far more economically efficient for the bad guys (whoever they are in your view) to bribe a few DC legislators than dozens of state politicians in places like Montpelier and Hartford.
State politicians are much cheaper, and no one from the New York Times pokes around when you buy off the state representative of East Bumfuck, Montana.
so, your answer is OMG, they are making money!11! It's not a money probelm, it's a resources problem. We simply don't have enought hospital resources to serve everyone in the us. it's not making money, it's not having enough beds and skilled people to do the work.
Get an MD and help out, then you'll discover how you really DONT want the government to tell you which patients to serve.
> It's not a money probelm, it's a resources problem.
Most people would consider money a resource, and quite a few rural hospitals are closing because of a lack of that specific resource.
> you'll discover how you really DONT want the government to tell you which patients to serve
Yeah, wait until you hear about private for-profit insurers doing that instead.
Honestly, after stories like these, I don't want a corporation telling me which patients to serve even more. At least government is theoretically accountable for their decisions.
Healthcare is ~17% GDP
Slavery was estimated at ~12% and "hey, you need to lose a few % of your margin and actually pay those people" started a war.
Now, there's an argument to be made about ideology, geographic concentration of industry, etc. doing a fair bit of lifting kicking that off (their own neighbors telling them to stop surely would have gone over better than a bunch of smarmy northerners in their ivory towers telling them the same thing). But the fact remains that you cannot make a large fraction of the country take a haircut without causing strife.
The only way to fix this "nicely" at this point is to boil the frog over decades.
As long as you accept the outcome of “drop dead” when something happens to you.
Problem is you’ll go right to the emergency room when you have a heart attack.
Yep they will move to California the moment they get cancer. Never trust a libertarian.
What's a libertarians take on how health care should work? Completely privatized, completely socialized, somewhere in between?
“I’ll put out this fire for you if you pay me $5000”
This is one of those things that, if it weren't already a public service, could never be implemented as one today. Add to that list public schools and public libraries.
"I don't want to be forced to pay for insurance, but will move to a state with subsidized insurance the second I need it."
The fact that the hospital doesn't know what a procedure costs (they make it up based on deals with medicare, medicaid, and individual insurance companies) should give you a hint.
Yes, the patient needs skin in the game. People need to take care of their own health. Most procedures are given to grossly unhealthy people.
Yes, completely privatize it. Make people pay for their care so their daily decisions are weighed against what affect it will have on their overall health.
> Most procedures are given to grossly unhealthy people.
Well, yeah. That's the idea behind "medically necessary". We don't do elective heart transplants on healthy people for funsies.
“ The fact that the hospital doesn't know what a procedure costs (they make it up based on deals with medicare, medicaid, and individual insurance companies) should give you a hint.”
The hint here is that the random pricing needs to stop. Same procedure for the same price. No market can work if participants don’t know the actual price. Insurance and hospitals probably have a very good idea but patients are being kept totally in the dark. You are expected to just accept what this opaque machinery comes up with.
So what if someone gets cancer or some other potentially fatal disease despite eating healthy, exercising, not smoking, etc, and they can't afford to pay for treatment?
They just get to die, or what?
Ah yes, more fragmentation. Surely that will lower the complexity and administrative burden, thereby leading to reduced costs!
The reason healthcare in the US is expensive is very simple: too many cooks in the kitchen. Private insurance simply should not exist. The undeniable reality is that the only way to achieve maximum efficiency is top-down administration.
I understand that that makes libertarians uncomfortable. But what we all have to acknowledge is what we have is not working. Other countries have worked it out. There's no reason to reinvent the wheel here.
I think in the case of Optum + UnitedHealthCare being the Scylla and Charybdis of a healthcare situation, we should break up this style of business. Owning both sides of the equation means there is no competition if you are unlucky enough to find this combination.
Feels like two wolves negotiating on how much of the sheep (the sheep is you) they get to eat.
Dare I ask, who is for the "consumer"? If we should even use those words in this system, which in my mind should be for a nation keeping its citizens alive and well both of their own sake and the state's sake.
That same basic "payvider" business model has been around since Kaiser Permanente pioneered it in the 1940s. The problem isn't with the business model per se, but with consolidation that has effectively eliminated competition in some regions.
EviCore looks like EvilCore and knowing some richfucks that got into various businesses, that may be more intentional than coincidence.
The problem here is one of balance.
As with so many situations where you have unreasonable corporate behavior the problem is the economics favors making wrong decisions. Thus there will be little attempt to prevent those wrong decisions. The only real fix is to make wrong decisions cost--look at airlines. You end up with more passengers that seats, you pay. It went a long way towards addressing the problem. (But it should have been higher and it should be indexed to inflation.)
But note the insurance is not always the bad guy. Patients want things that aren't medically warranted, especially when the right answer is "do nothing". And doctors like to run up the bill.
And note this article is focusing on things other than medical decisions--but describing a system that could only be a problem if they are making wrong medical decisions. How they decide what claims to examine is irrelevant, what matters is if they are making wrong medical decisions. It very much needs to be considered the practice of medicine and a denial should only come from someone of at least the same specialization as the doctor making the request. And "not medically necessary" should require an evaluation of why, you don't get to just say "no".
I am perplexed by the type of people that are able to stomach working in these kind of positions - how do they rationalize it? Do they really just not care? Like, in some industries that are not doing great things, or bordering on evil things, I can see sometimes how one could convince themselves they were actually doing good. But this denial stuff is nearly like, "press this button to make money, knowing you may be denying someone critical care that could kill them or cause them harm" and you're comfortable just mashing that button? How do they sleep at night? Or are there just a lot of really gung ho believers that hate provider billing with a passion and believe most of it is waste and they truly know better? Is it a bunch of sociopaths? How this can exist as an industry is crazy to me, I wouldn't even know how to hire, I'd expect the vast majority of applicants upon finding out would say "ew, no" but I guess I have a rosier view of humanity that does not align with reality.
By this logic how could you ever work in Healthcare? If you're a Doctor why are you taking a day off to - of all things - go to the beach? Do you really just not care? Take this day off, knowing you may be denying someone critical care that could kill them or cause them harm? And you're comfortable doing that? Do you love the beach that much?
What are you saying here? Do you just think it's unnecessary to audit the way 18% of US GDP is being spent? You think there is no waste, or it's so small to be negligible? Despite the fact that it's well established the US spends more and gets less benefit?
This isn't an audit, and drives up prices. But I guess this response kind of answers my question.
Maybe I'm just not understanding what you're saying here, but it seems pretty straightforward that you can't run an insurance system without reviewing claims. That's true whether it's a for-profit, not-for-profit, or government run insurance provider.
There's broad consensus that there is a ton of unnecessary and unwarranted care being done in the US. Doctors are not all experts in population health. Even the most well-meaning doctors are still subject to incentives that can lead to excessive testing and expensive treatments that have a low likelihood of improving patient outcomes.
Obviously it is also true that having a profit motive to deny claims incentivizes improper denials. But to simply say "no claim should ever be subject to review or denial, and anyone working to make the system efficient is evil" is deeply ignorant and fundamentally incompatible with the concept of insurance.
I recommend reading essays from: https://news.ycombinator.com/item?id=48090321. Tangentially related to your question.
TLDR is that it’s a job that can pay enough to keep one housed, and sometimes there are no alternatives.
I’d redirect the outrage away from the grunts denying care, and towards the leadership that set up those incentives. And even further, when the shareholders demand more profit because the line must go up, what to do?
Thought I would remind people here of this simple, but mostly unknown fact about American healthcare:
American taxpayers invest more public dollars per capita in healthcare than anyone in the world. This before a single cent is paid into the private insurance system. Through Medicare, Medicaid, VA and other public health programs, you pay about 40% more public dollars per-capita than the most socialist, gold plated single payer system anywhere else.
You are not only getting ripped off by your insurer, but you are getting ripped off a public system, which has more than enough money to provide every man, woman and child with a lifetime of world-class, free at the point of service universal healthcare.
Exactly. In chart form:
https://commons.wikimedia.org/wiki/File:OECD_health_expendit...
Geiz-ist-geil-healthcare is, according to many election results anyway, what most US citizens want; everything else is communism/socialism/woke/leftist/[...].
My IT guy spends his days pushing problems that come across his desk into an LLM and generating reports/responses. He then pushes the generated material out to people in slack channels and says “hey this is what we need to do”. New AI tool? “Lets integrate, this AI report says it’s a good idea”. The C-Suite are so brain dead and unskilled at leadership that they just rubber stamp anything. When asking questions and poking holes in the generated material in order to establish some sort of vetted guidance and leadership direction, the IT and Leadership push back “Well what does your team think we should do?”
Yo! I’m literally asking you that question. I’m the implementer employee you’re the specialists and leaders. Did you read the report? Does it make sense? Did you see anything that seems off?
“What do you think we should do?”
This is how this stuff devovles. All nepotist C-Suites should be hollowed out and fired and we should rebuild our institutions without these useless people that can’t even remember how to run a business or make a decision 6 years into LLMs.
If insurance companies are for profit then they are incentivized to deny coverage. This fucking sucks.
Not exactly. ACA imposes minimum Medical Loss Ratios. If they deny everything, the MLR would be zero and they would have to refund premiums.
The more care that's allowed, the more dollars they can keep. It's a complex optimization though; people like to pay less premiums, so an insurance company wants to price coverage low enough to attract customers and then allow enough care to keep the premiums without allowing so much as to reduce their margin.