Cigna’s claims review process does not rely on an algorithm or artificial intelligence to deny care through prior authorization or improperly shift costs to its members, the company said Thursday.
The insurer released additional information on its website about its procedure-to-diagnosis, or PxDx, system after two members hit the company with a proposed class-action lawsuit in California federal court on Monday alleging they had been wrongly denied coverage. The lawsuit, filed by Suzanne Kisting-Leung and Ayesha Smiley, came in response to a March report from the ProPublica news outlet that said Cigna’s medical staff rely on an algorithm called PxDx to deny large batches of patient claims without reviewing the individual medical necessity of each case.
State and federal regulators are investigating the claims, and the House Energy and Commerce Committee subpoenaed Cigna for more information about the PxDx system in May.
"This [legal] filing appears highly questionable and seems to be based entirely on a poorly reported article that skewed the facts," a Cigna spokesperson wrote in an email. "Based on our initial research, we cannot confirm that these individuals were impacted by PxDx at all. To be clear, Cigna uses technology to verify that the codes on some of the most common, low-cost procedures are submitted correctly."
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Cigna has used the PxDx software system over the past several years to accelerate payments to physicians, the company said in a news release. PxDx relies on "sorting technology" that matches the diagnosis codes on doctors’ claims with the codes Cigna has associated with its medical necessity policies to determine whether the insurance company must pay for its members' procedures, according to Cigna.
Cigna said it uses PxDx to review claims for 50 low-cost tests, such as a vitamin D screening.
“All other procedures are typically not subject to PxDx for review,” said a fact sheet accompanying the news release.
Claims that are denied payment through this process represent less than 1% of the total volume of claims, and 94% of bills PxDx reviews are automatically approved and paid, the company wrote. Providers can resubmit denied claims with updated diagnosis codes or the claims can be appealed, the company said. If members visited an in-network provider, their doctor should not bill them for services denied by PxDx, Cigna wrote.
Similar versions of this process are used by the Centers for Medicare and Medicaid Services and other health insurers, the company said.
Cigna does not profit from denying claims and passes on cost savings to its members through lower premiums and better health benefits, according to the fact sheet.
The insurer provides coverage to 17.8 million U.S. members. In its most recent earnings report, Cigna reported net income growth of 5.8% to $1.2 billion, or $4.24 per share, on revenue increases of 5.7% to $46.5 billion during the first quarter, driven by higher commercial health insurance premiums and a boost in pharmacy services. The company increased its annual profit guidance by 10 cents to at least $24.70 per share.
