In March 2023, ProPublica brought to light a laundry list of allegations about Cigna’s claim denial process, essentially stating that doctors on Cigna’s medical review staff are automatically denying medical claims without opening files.
Insurance company doctors are generally tasked with examining patient records and reviewing coverage policies before denial status can be reached. Yet, over the course of two months in 2022, Cigna doctors denied over 300,000 requests for payments using their internal “PXDX” review — a review method that allows them to spend an average of 1.2 seconds on each case.
This auto-deny algorithm still leaves room for patients and providers to appeal, but appeals are such large hassles that Cigna bets people won’t take the time. “In one corporate document,” ProPublica journalists wrote, “Cigna estimated that only 5% of people would appeal a denial resulting from a PXDX review.”
That’s right. Only 5%. That means Cigna is arbitrarily denying health insurance claims without reviewing them and is only held accountable by 5% of their victims.
Cigna pushes back on these claims, citing that their PXDX review only captures claims (and prior authorization requests) that were already missing information or had an information mismatch. But sadly this isn’t the first Cigna claim misconduct issue brought to light. A proposed class-action lawsuit in California alleges Cigna intentionally underpaid medical claims as far back as 2017. The class-action suit challenges that Cigna failed to apply the appropriate MultiPlan contracted rates to claims — therefore underpaying several providers and disregarding their rightful reimbursement.
But Cigna is likely not the only insurance company that isn’t consistently working in your patients’ or your providers’ best interests. The best way to stay on top of possible issues from your insurance payers is to monitor your payer relationships and contracts, prevent denials, and work every denial that comes through your office.
When dealing with Cigna or any other health insurance company that denies claims, healthcare providers can take proactive steps to safeguard revenue and advocate for fair reimbursement. Here are some essential actions:
Understand Cigna's PXDX System
Cigna’s PXDX system reportedly uses an automated algorithm to deny claims quickly, often without thorough review. Knowing that algorithm-based denials may occur allows providers to prepare, ensuring that claims are as complete and accurate as possible before submission.
Implement a Strong Appeals Process
Although only a small percentage of Cigna claim denials are typically appealed, an organized and efficient appeal process can significantly improve outcomes. Providers should prioritize prior authorization and include all necessary patient files and medical records in the appeals process to increase the likelihood of a successful outcome.
Monitor Payer Contracts Regularly
Regularly reviewing payer contracts and staying informed of policy changes, especially for large insurers like Cigna, helps healthcare organizations understand coverage terms and advocate for accurate reimbursement. This approach is crucial for protecting the organization’s financial health.
Utilize Denial Management Software
Investing in denial management tools can help streamline the claims processing workflow. For example, Rivet’s platform enables providers to manage claim denials efficiently, tracking which claims were denied and implementing a strategy to appeal or rework those claims.
Stay Updated on Legal Recourses
Given recent class-action lawsuits involving Cigna, healthcare providers should stay informed of any legal developments that might impact their claims. Legal actions, such as the recent California lawsuit, may influence state laws or regulations that could benefit providers in the future.
By taking these steps, healthcare providers can actively respond to claim denials, maintain a strong relationship with payers, and protect their revenue.
What if you don’t have the time or resources to increase your team’s workload? That’s what Cigna and other payers are counting on, but clinicians and healthcare admin can stop the cycle. Cigna’s 5% appeal could be accurate overall, but with Rivet, you can appeal 98% of all of your denials. You can work 70% more denials on average than what you’re doing now and rescue your revenue.
Learn more about Rivet denial management and payer contract management software or schedule a demo to learn more.
1. Why does Cigna deny healthcare claims automatically?
Cigna reportedly uses an automated PXDX system that denies claims based on specific criteria. The process allows Cigna doctors to review and deny claims quickly, sometimes without detailed file review, raising concerns about reimbursement fairness.
2. What is the PXDX system used by Cigna?
Cigna’s PXDX is an algorithm-driven system designed to expedite the claim denial process. It flags claims that do not meet certain criteria, often in as little as 1.2 seconds, and denies them without a comprehensive review.
3. How can healthcare providers respond to Cigna’s claim denials?
Providers can implement a strong appeals process, track denied claims systematically, and ensure that all patient files and prior authorizations are included. Utilizing denial management software can also streamline the appeal process.
4. What types of claims are commonly denied by Cigna?
Common reasons for Cigna claim denials include missing information, prior authorization issues, and mismatched medical records. Understanding these patterns can help providers submit more accurate claims initially.
5. Is there any legal action against Cigna for claim denials?
Yes, Cigna has faced class-action lawsuits in states like California, where plaintiffs allege that the company underpaid claims and failed to apply proper contracted rates. These cases could lead to changes in healthcare reimbursement practices.
6. Can denial management software help reduce claim denials?
Yes, denial management software, like Rivet, can help providers monitor claim denials, streamline appeals, and ensure more consistent reimbursement by automating workflows and tracking denials in real time.
7. How effective is it to appeal a Cigna claim denial?
Appealing a Cigna claim denial can be effective if approached systematically, including providing complete documentation and using denial management tools. Though Cigna estimates only 5% appeal, a structured process can yield much better success rates.
8. What are some proactive steps to prevent Cigna claim denials?
Providers should ensure all patient information is accurate, verify insurance eligibility and prior authorization, and stay up-to-date on Cigna’s coverage policies. By focusing on these areas, many claim denials can be avoided.
9. What impact do Cigna’s automated denials have on patients?
Automated claim denials can lead to unexpected bills and higher out-of-pocket costs for patients. This often creates financial stress and may discourage patients from pursuing necessary care.
10. How does Cigna’s claim denial process differ from other insurers?
Cigna’s use of the PXDX algorithm is unique in its automation and speed, which may lead to more frequent claim denials without detailed review. Other insurers may follow different processes with more manual claim assessments.
