Two Cigna members have filed a class-action complaint against their insurer for allegedly denying large batches of members' claims without individual review, thereby denying them coverage for certain services.
Many states, including California, require physicians to review patient files and coverage policies before denying claims for medical reasons. The July 24 lawsuit, filed in the Eastern District of California, alleges that Cigna has bypassed these steps by having an algorithm called "PXDX" complete the review and then having physicians sign off on groups of denied claims.
"Relying on the PXDX system, Cigna's doctors instantly reject claims on medical grounds without ever opening patient files, leaving thousands of patients effectively without coverage and with unexpected bills," the complaint said. "The scope of this problem is massive."
The plaintiffs are seeking an injunction against the PXDX tool and monetary damages, along with a jury trial.
"PXDX is a simple tool to accelerate physician payments that has been grossly mischaracterized in the press," a Cigna Healthcare spokesperson told Becker's. "The facts speak for themselves, and we will continue to set the record straight."
The lawsuit comes after ProPublica first reported on the PXDX tool in March and said Cigna's internal claims review process may save the company millions every year when members do not appeal denied claims.
The report said Cigna physicians denied more than 300,000 claims over two months in 2022 through the system, which equated to 1.2 seconds of review per claim on average.
Following the report, state insurance commissioners and federal lawmakers publicly raised concerns and requested more information from Cigna about its claims review process, with some calling for an investigation.
"It's hard to imagine that spending only seconds to review medical records complies with the California law," Dave Jones, California's former insurance commissioner, told ProPublica. "At a minimum, I believe it warrants an investigation."
On May 16, a Cigna spokesperson told Becker's it welcomes "the opportunity to fully explain our PxDx process to regulators and correct the many mischaracterizations and misleading perceptions ProPublica's article created."
"We categorically disagree with this mischaracterization of our process for accelerating payment of claims for routine, low-cost screenings," a Cigna Healthcare spokesperson said in March. "PxDx allows us to automatically pay providers for claims that are submitted with the correct diagnosis codes and prioritizes our medical directors' time for more complex reviews. It does not create any impediments to or denials of care because it takes place after a patient receives the service, and even a denial does not result in any additional out of pocket costs for patients using in-network providers."
Cigna said its internal claims review process follows industry standards, including processes that have been used by CMS. It also noted that there is no use of AI tools or the PXDX tool to review claims that are submitted with incorrect medical codes.