I was stunned, as you probably were, too, over the cold-blooded murder of United Health Care Insurance (UHC) CEO Brian Thompson in New York City last week. The social media backlash was equally appalling to me. Most of the social media blowback complained of delayed and denied claims for serious illnesses that may have led to patient deaths, with some commenting that Mr. Thompson “got what he deserved.”
Still, you don’t have to have murder in your heart when rightly complaining about appalling healthcare industry practices that deny critical care for higher profits.
The US leads the Western world in health care costs, by nearly double and provides worse healthcare. The US healthcare system is not serving the public well. It is time for a bipartisan congressional investigation. Additionally, I prefer that companies drop the healthcare insurance providers who lead in denied care and poor administration and switch to better providers.
Turning back to last week’s events, some of the social media #unitedhealthcare backlash included:
- A nurse with 31 years of experience calling out UHC for its leading rate of claims denial, to the point of saying that the company’s policies have led to the deaths of hundreds of thousands of patients and saying that MR. Thompson “got what he deserved.”
- A doctor calling out UHC for denying claims for medical treatment or tests that are within standards of care (not experimental treatment).
- A women calling out the lack of discussion in the last US presidential election over the poor care of American healthcare for the majority of Americans and instead the vociferous anger over transgender care health benefits, a population estimated to be less than half of one percent of the population.
UHC is not alone. Last week, as reported by CBS, Anthem Blue Cross Blue Shield said Thursday that the health insurance provider is reversing a policy that was set to go into effect in February that would have limited anesthesia coverage during surgeries and other procedures, a change that had prompted an outcry from some physicians and lawmakers.
CBS News quotes Donald E Arnold who is president of the American Society of Anesthesiologists, “This is just the latest in a long line of appalling behavior by commercial health insurers looking to drive their profits up at the expense of patients and physicians providing essential care. This egregious policy breaks the trust between Anthem and its policyholders who expect their health insurer to pay physicians for the entirety of the care they need.”
I have selected and overseen the purchase of medical benefits and health care administrators. United Health Care for years was known for poor claims administration and a high denial rate.
A chart circulating on social media (below) claims that UHC has a denial rate of 32 percent, the highest in the industry. As reported by Yahoo! News, this figure comes from the personal finance website Value Penguin, which said it circulated the chart from available in-network data from plans sold on the marketplace. United Healthcare has not responded to inquiries from the news media at the time of this post. UnitedHealthcare is a division of UnitedHealth Group and the largest private health insurer in the U.S. with a market cap north of $500 billion.
Although the Affordable Care Act permits regulators to require insurers to share information on claim denials, the federal government has so far not collected much of this data and has shared even less with the public, according to a 2023 report from ProPublica. Regulators should ask for this data and share it, with Congress’s support.
Healthcare claim denials are rising in the US
According to Yahoo! News, claims denials have been rising in the United States.
In October, a report from the U.S. Senate Permanent Subcommittee on Investigations showed that the nation’s insurers have been using AI-powered tools to deny some claims from holders of Medicare Advantage plans.
The report found that UnitedHealthcare’s denial rate for post-acute care — health care needed to transition people out of hospitals and back into their homes — for people on Medicare Advantage plans (a complement insurance plan to Medicare in the US for those 65 and over) rose to 22.7 percent in 2022, from 10.9 percent in 2020.
According to the New York Times, earlier this year, a Senate committee investigated Medicare Advantage plans denying nursing care to patients who were recovering from falls and strokes. It concluded that three major companies — UnitedHealthcare, Humana, and CVS, which owns Aetna — were intentionally denying claims for this expensive care to increase profits. United Healthcare, the report noted, denied requests for such nursing stays three times more often than it did for other services. (Humana had an even higher figure, denying at a rate 16 times higher.) UnitedHealthcare did not respond to a request for comment about its history of claim denial in the New York Times article.
Journalists have also scrutinized United’s denial practices, according to the same New York Times article. In January, the health news outlet Stat published a detailed investigation into how a UnitedHealthcare subsidiary, NaviHealth, used algorithms to deny care for seniors enrolled in the company’s Medicare advantage plan.
In August, a report from the health policy research non-profit KFF [the Kaiser Family Foundation] found that all Medical Advantage insurers fully or partially denied 7.4 percent of prior authorization requests — requests for coverage of specific medical services — in 2022, up from 5.4 percent in 2019.
US spends significantly more on healthcare, nearly twice as much, and receives worse care
According to the Kaiser Family Foundation, the US spends significantly more on healthcare than comparable countries do, nearly double, and yet has worse health outcomes and lower utilization of the health system than in peer countries.
People in the U.S. are less likely to see a doctor, have a long hospital stay for the same illness in other countries, and be able to make a prompt appointment for medical care. The U.S. also has fewer physicians per capita than other countries, making access to care more difficult in some areas, according to KFF.
The healthcare spending chart below shows that the US spends twice as much as comparable countries do on health, driven mostly by higher payments to hospitals and physicians. (Feel free to click on the chart to make it easier to read.)
When I worked in the medical device industry, executives would say that the US spends the most on health care because it leads to medical innovation. Does it? And at what cost?
Medical innovation is measured in many ways. Let’s look at three areas, medical devices like cardiac pacemakers, healthcare which is health insurance, and pharmaceuticals.
According to Vantage Medtech, the US does lead the world in medical technology innovation. However, it notes that other countries, such as Canada, France, and Israel may be catching up.
Switching to healthcare innovation, the Swiss lead. According to FreeOpp, the Swiss private healthcare system ranked first in 2022 for three years in a row. Three other countries earned an Elite overall rating: Ireland (2nd), the Netherlands (3rd), and Germany (4th). Switzerland was consistently strong across the board. The U.S. did improve its ranking in Choice to 10th in 2022 vs. 20th in 2021) and maintained its wide lead atop the Science & Technology rankings.
In pharmaceutical innovation, the United States spends a lot on innovation but the US is less innovative for its investment than other countries. The National Library of Medicine found that the United States accounted for 42 percent of prescription drug spending and 40 percent of the total Gross Domestic Product (GDP) among innovator countries and was responsible for the development of 43.7 percent of the new molecular entities (NMEs). The United Kingdom, Switzerland, and a few other countries innovated proportionally more than their contribution to GDP or prescription drug spending, whereas Japan, South Korea, and a few other countries innovated less.
Higher prescription drug spending in the United States does not disproportionately privilege domestic innovation, and many countries with drug price regulation were significant contributors to pharmaceutical innovation.
What appears to be a cold-blooded murder of the United Health Care CEO was a tragic event. But it’s also clear that our medical system is not working. Americans have good cause to be angry. Americans pay nearly double the cost for healthcare than peer countries for worse care. ..
It is time for a bipartisan congressional investigation into the healthcare industry, including how the use of Artificial Intelligence is leading to an unprecedented number of claims denials even for medical care that fits the definition of an affordable standard of care. It is also time that the private sector drops the worse healthcare insurers and switches to better ones.
About Victor
Victor Assad is the CEO of Victor Assad Strategic Human Resources Consulting and Managing Partner of InnovationOne, LLC. He works with organizations to transform HR and recruiting, implement remote work, and develop extraordinary leaders, teams, and innovation cultures. He is the author of the highly acclaimed book, Hack Recruiting: The Best of Empirical Research, Method and Process, and Digitization. He is quoted in business journals such as The Wall Street Journal, Workforce Management, and CEO Magazine. Victor has partnered with The Conference Board on innovation research. Subscribe to his weekly blogs at http://www.VictorHRConsultant.com