Dr. Jonathan Fellers first realized Maine’s largest insurance provider was downcoding his claims last January. Nine months later, the psychiatrist dropped Anthem from his network. But not before his office spent hundreds of hours mailing physical copies of every patient interaction more than 1,000 miles to the company’s Indianapolis headquarters, in an effort to appeal the claims.
“We couldn’t survive on getting paid as little as we were for these patients,” Fellers said. “It would be very equivalent to like, if you went out to a restaurant and saw on the menu the steak was this much and you bought the steak. Then decided afterwards, ‘You know, I don’t think it was a very good quality steak. I’m going to only pay as much as a hamburger for it.’ ”
Fellers’ experience is not uncommon. The nation’s second-largest insurer is working on back payments owed to providers, with the insurer blaming months-long payment delays on an update to its claims processing system and the downcoding on a recently implemented platform from Cotiviti, a vendor that uses artificial intelligence to identify improper payments. The delay in resolving the situation has led some provider groups to question if computer problems are really to blame for the issues, or if they’re an intentional strategy on the part of the insurer, which they say never planned on paying back providers anyway.
Because of the opaque payment rules governing the Cotiviti algorithm and a lack of communication from Anthem about the new technology, the rumor mill is running wild, Fellers said. For his part, he believes the insurer downcoded and delayed provider payments to increase its cash reserve.
“They use this algorithm to decide that what I billed was not appropriate, without looking at the medical records, without looking at anything, just a computer program made that decision,” Fellers said. “It’s convenient when you get to define who an outlier is.”
Cotiviti, which advertises itself as an AI-powered payment integrity company that saves its 180 health insurer customers more than $5.7 billion annually, declined to comment. Anthem has temporarily paused use of the software and will not use it for specialty behavioral health providers going forward, an Anthem spokesperson wrote in an email. Staffing issues at the insurer compounded workflow challenges it was having with its software, and Anthem has reprocessed all of the downcoded claims and is in the process of repaying providers, the spokesperson said.
“Moving forward, we are holding ourselves to a higher standard for speed and accuracy in paying claims,” the spokesperson said. “Along with other enhancements, we expect this will create an improved overall care provider experience that will lead the industry.”
Anthem has established a team dedicated solely to assisting Maine providers and is reaching out directly to clinicians who have been impacted by its new system, the spokesperson said. The company has said Cotiviti and an update to its automated claims processing system also downcoded and delayed payments to clinicians in New Hampshire, and that it is working to pay back providers. It denied having broad-scale problems with its reimbursement system, saying that, in the last 12 months it processed 92% of claims within 14 days, and 98% within 30 days. The spokesperson did note that if a provider was unhappy with their reimbursement amount, renegotiating the claim could hold up payment.
But the American Hospital Association has fielded complaints about Anthem from dozens of hospitals nationwide, said Molly Smith, group vice president for public policy. The hospital lobbying group wrote a letter to Anthem CEO Gail Boudreaux in September asking the insurer to figure out how to get providers paid. In response, Anthem set up a SWAT team of provider relations officials on the ground, Smith said. But she said the payment delays have still not been resolved.
“There is a problem with their claims-processing backlog, and it appears to be somewhat of a technology issue, but it’s kind of hard to believe that’s all it is because these problems have persisted for many, many months,” Smith said.
Anthem denied having any business incentive to delay payments to providers.
Attention from regulators
State insurance commissioners in Maine and Georgia are investigating Anthem’s market conduct. The New Hampshire insurance commissioner said he is working with the insurer to resolve payment delays. Wisconsin’s insurance commissioner said its office helped every provider resolve their issues with Anthem’s computer problems except one, whose dispute is ongoing. Ohio’s insurance commissioner encouraged providers that are having problems with Anthem to come forward. Colorado’s insurance commissioner continues to look into complaints about the insurer. And officials from three other states said privacy laws prohibit them from confirming or denying whether a formal audit of Anthem’s business practices had been launched.