Lawsuits pile up against Cigna over alleged mass claim denials

The Cigna Group is facing a growing number of lawsuits from members and a shareholder following a ProPublica report that alleges the company denies large batches of members' claims without individual review, thereby denying them coverage for certain services.

In March, ProPublica reported that Cigna may be violating state laws by allowing its medical directors to deny large batches of claims without reviewing individual members' files using an automated claims review process called PxDx. 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.

In California, two Cigna members filed a class-action complaint against the insurer in July over the alleged issues. Many states, including California, require physicians to review patient files and coverage policies before denying claims for medical reasons. The July complaint claims Cigna bypassed those steps using the PxDx tool.

In late August, a Minnesota member who was enrolled in a self-funded Cigna plan in 2018 also filed a complaint against the company. She alleges she was automatically denied coverage for certain services because of the PxDx tool, leading to $3,200 in medical bills that were eventually sent to collections. She is seeking a class action and a subclass for Minnesota residents. 

In September, a shareholder sued Cigna in Delaware's Court of Chancery to obtain more information about the company's claims review process. The shareholder said he attempted to seek more information from Cigna directly following the ProPublica report. Once he did not receive the requested information, he filed a complaint to "investigate possible mismanagement and/or breaches of fiduciary duty and other wrongdoing" by Cigna, and noted that additional lawsuits could be filed.

"There is reason to believe that the company's use of automated systems to deny insurance claims will result in regulatory action and has already caused reputational harm," the complaint said.

Following the ProPublica report, state insurance commissioners and federal lawmakers publicly raised concerns and requested more information from Cigna about the process, with some calling for an investigation. In Pennsylvania, lawmakers have introduced legislation that would require payers to disclose how they use AI in claims review, citing the ProPublica report.

Cigna has previously said the ProPublica report is "riddled with factual errors and gross mischaracterizations." The company said its claims review process follows industry standards, including processes that have been used by CMS. It also noted that the technology behind PxDx is more than a decade old and does not involve algorithms, artificial intelligence or machine learning. The company has published additional information on its website about the tool and its claims process.

"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," a Cigna spokesperson previously told Becker's. "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."


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