The probe found widespread noncompliance and violations of federal law in how health plans and insurers cover mental health care, echoing the findings of a recent ProPublica investigation.
This article was published on Friday, January 24, 2025 in KFF Health News.
The U.S. Department of Labor found widespread noncompliance and violations of federal law in how health plans and insurers cover mental health care, findings that mirror a recent ProPublica investigation.
Health plans, and the companies that administer them, have excluded key behavioral treatments, such as therapies for substance use and autism, and offered inadequate networks of mental health providers, according to a 142-page report released Jan. 17 in conjunction with the Treasury and Health and Human Services departments.
The report, which the agencies are required to file regularly to Congress, also detailed the results of secret shopper surveys of more than 4,300 mental health providers listed in insurance directories and found an "alarming proportion" were "unresponsive or unreachable." Such error-ridden plans, commonly known as ghost networks, make it harder for patients to get the treatment they need, ProPublica has previously found.
Since 2021, the Labor Department has addressed violations in health plans that serve more than 7 million people, according to the report. The agency has worked to remedy the problems by seeking changes to plan provisions, policies and procedures, as well as working to ensure wrongly denied claims were paid.
But the report acknowledged that while plans and insurers have made some progress, they continue to fall short. For instance, federal officials wrote that insurers were working faster to fix problems in their plans once they had been identified, but officials had not seen sufficient improvement overall.
The report examined the enforcement and implementation of the federal Mental Health Parity and Addiction Equity Act, which requires health insurance plans to provide the same access to mental health care as they do to medical care. Last week, on the same day the report was released, department staff told ProPublica that the agency was investigating issues related to our reporting.
The Labor Department regulates insurance plans for about 136 million Americans who receive health coverage through their employers and is responsible for enforcing federal protections around their mental health claims. Federal regulators have struggled to hold insurance companies accountable for improperly denying mental health coverage, in part because of staffing and budgetary constraints.
The agency has asked Congress for additional funding on multiple occasions and, in its most recent congressional report, wrote that the agency is left with one investigator for every 13,900 plans it regulates, a higher workload than in previous years. Some temporary funding runs out in September, and its "full depletion will likely have catastrophic effects" on its enforcement capabilities, according to the report.
Timothy Hauser, a deputy assistant secretary of labor, said in an interview on the day of the report's release that the agency is investigating the oversight and management of doctors hired by insurance companies who repeatedly deny mental health coverage for patients — and may open additional investigations.
Hauser, who has worked at the agency for more than three decades and is staying on in the new administration, said the agency is probing how insurers use and supervise doctors they rely on to conduct reviews of coverage and whether those doctors review cases in a "fair and dispassionate" way. ProPublica's reporting raised serious concerns around those issues.
Last month, ProPublica examined how insurance companies, including UnitedHealth Group, Cigna, and Blue Cross and Blue Shield, rely on doctors to make crucial decisions on whether to approve mental health coverage even after courts have criticized their judgment. Judges have ruled that in denying such coverage, insurers violated federal law and acted in ways that were "puzzling," "disingenuous" and even "dishonest."
Some insurers and doctors, according to court records, engaged in "selective readings" of the medical evidence, "shut their eyes" to medical opinions that opposed their conclusions, and made critical errors in their reviews that were sometimes contradicted by medical records they had said they read.
Hauser said he could not comment on specific investigations but said that agency officials have discussed the ProPublica story, which he said "will have an impact on the questions we ask" and the "approaches we take."
At least one investigation in the past has resulted in the removal of a doctor and the outside review organization they worked for, a spokesperson for the Labor Department said previously.
Insurance companies across the country rely on doctors working on their behalf to determine whether the treatment sought by the patients' own doctors is medically necessary. If they determine it is not, they recommend denying coverage, which can leave patients in crisis and without the treatment they need. In some cases, those decisions have led to fatal consequences.
"It's supposed to be done with impartiality and without having been structured in such a way as to incentivize the physicians to favor denying claims as opposed to granting claims," Hauser said. "Similarly, the physicians and the providers should not be selected because of their propensity to to deny claims."
United, Cigna and Blue Cross and Blue Shield did not immediately respond to requests for comment but in the past have said they employ licensed physicians to conduct reviews and work to ensure the doctors issue appropriate coverage decisions. The companies have said they conduct regular audits of doctors' decisions, provide mentorship and coaching opportunities and are committed to providing access to safe, effective and quality care to patients.
Hauser said he was struck by the story of Emily Dwyer, who was featured in a ProPublica article that examined the role of company psychiatrists. She was 15 and suffered from severe anorexia — she arrived at a residential treatment center wearing her 8-year-old sister's jeans — when United Healthcare denied her coverage.
United argued that three separate doctors had reviewed her case. The Dwyers sued and lost, but appealed to the 5th U.S. Circuit Court of Appeals, which reversed that decision and ruled unanimously in favor of the family. In a harshly critical opinion, the judges wrote that the denial letters issued by the three doctors were "not supported by the underlying medical evidence." In fact, the court found, they were "contradicted by the record."
Dwyer, who was pleased to learn of the agency's investigation, said she hopes it results in "substantive action."
"I never would have thought that our story would be part of that," she said. "I think it's incredible that the Department of Labor is paying attention to this issue and is investigating the insurance doctors. But I also hope they look beyond the actions of the individual doctors to deeper issues of the way insurance companies operate more systematically."
Donald Trump's pick to lead the federal health agency has vowed to replace hundreds of staffers and shift research away from infectious diseases and vaccines. Such an overhaul could imperil the development of life-saving treatments, experts warn.
This article was published on Wednesday, January 15,2025 in ProPublica.
Lifesaving HIV treatments. Cures for hepatitis C. New tuberculosis regimens and a vaccine for RSV.
These and other major medical breakthroughs exist in large part thanks to a major division of the National Institutes of Health, the largest funder of biomedical research on the planet.
For decades, researchers with funding from the NIH's National Institute of Allergy and Infectious Diseases have labored quietly in red and blue states across the country, conducting experiments, developing treatments and running clinical trials. With its $6.5 billion budget, NIAID has played a vital role in discoveries that have kept the nation at the forefront of infectious disease research and saved millions of lives.
Then came the COVID-19 pandemic.
NIAID helped lead the federal response, and its director, Dr. Anthony Fauci, drew fire amid school closures nationwide and recommendations to wear face masks. Lawmakers were outraged to learn that the agency had funded an institute in China that had engaged in controversial research bioengineering viruses, and questioned whether there was sufficient oversight. Republicans in Congress have led numerous hearings and investigations into NIAID's work, flattened NIH's budget and proposed a total overhaul of the agency.
More recently, Robert F. Kennedy Jr., Trump's nominee to run the Department of Health and Human Services, which oversees the NIH, has said he wants to fire and replace 600 of the agency's 20,000 employees and shift research away from infectious diseases and vaccines, which are at the core of NIAID's mission to understand, treat and prevent infectious, immunologic and allergic diseases. He has said that half of NIH's budget should focus on "preventive, alternative and holistic approaches to health." He has a particular interest in improving diets.
Even the most staunch defenders of NIH agree the agency could benefit from reforms. Some would like to see fewer institutes, while others believe there should be term limits for directors. There are important debates over whether to fund and how to oversee controversial research methods, and concerns about the way the agency has handledtransparency. Scientists inside and outside of the institute agree that work needs to be done to restore public trust in the agency.
But experts and patient advocates worry that an overhaul or dismantling of NIAID without a clear understanding of the critical work performed there could imperil not only the development of future lifesaving treatments but also the nation's place at the helm of biomedical innovation.
"The importance of NIAID cannot be overstated," said Greg Millett, vice president and director of public policy at amfAR, a nonprofit dedicated to AIDS research and advocacy. "The amount of expertise, the research, the breakthroughs that have come out of NIAID — It's just incredible."
To understand how NIAID works and what's at stake with the new administration, ProPublica spoke with people who have worked for NIAID, received funding from it, or served on boards or panels that advise the institute.
Decisions, Decisions
The director of NIAID is appointed by the head of the NIH, who must be approved by the Senate. Directors have broad discretion to determine what research to fund and where to award grants, although traditionally those decisions are informed by recommendations from panels of outside experts.
Fauci led NIAID for nearly 40 years. He'd navigated controversy in the past, particularly in the early years of the HIV epidemic when community activists criticized him for initially excluding them from the research agenda. But in general until the pandemic, he enjoyed relatively solid bipartisan support for his work, which included a strong focus on vaccine research and development. After he retired in 2022, he was replaced by Dr. Jeanne Marrazzo, an HIV researcher who was formerly the director of the division of infectious diseases at the University of Alabama at Birmingham. She has spent much of her time in the halls of Congress working to restore bipartisan support for the institution.
NIH directors typically span presidential administrations. But Donald Trump has nominated Dr. Jay Bhattacharya to lead NIH, and current director Dr. Monica Bertagnolli told staff this week that she would resign on Jan. 17. A Stanford professor, Bhattacharya has spent his career studying health policy issues like the implementation of the Affordable Care Act and the efficacy of U.S. funding for HIV treatments internationally. He also researched the NIH, concluding that while the agency funds a lot of innovative or novel research, it should do even more.
In March 2020, Bhattacharya co-authored an opinion piece in The Wall Street Journal arguing that the death toll from the pandemic would likely be far lower than predicted and called for lockdown policies to be reevaluated. That October, he helped write a declaration that recommended lifting COVID-19 restrictions for those "at minimal risk of death" until herd immunity could be reached. In an interview with the libertarian magazine Reason in June, he said he believes the COVID-19 epidemic most likely originated from a lab accident in China and that he can't see Trump's Operation Warp Speed, which led to the development and distribution of COVID-19 vaccines at unprecedented speed, as a total success because it was part of the same research agenda.
Bhattacharya declined an interview request from ProPublica about his priorities for the agency. A recent Wall Street Journal article said he is considering how to link "academic freedom" on college campuses to NIH grants, though it's not clear how he would measure that or implement such a change. He's also raised the idea of term limits for directors and said the pandemic "was just a disaster for American science and public health policy," which is now in desperate need of reform.
Where the Money Goes
Grants from NIAID flow to nearly every state and more than half of the congressional districts across the country, supporting thousands of jobs nationwide. Last year, nearly $5 billion of NIAID's $6.5 billion budget went to U.S. organizations outside the institute, according to a ProPublica analysis of NIH's RePORT, an online database of its expenditures.
In 2024, Duke University in North Carolina and Washington University in Missouri were NIAID's largest grantees, receiving more than $190 and $173 million, respectively, to study, among other things, HIV, West Nile vaccines and biodefense.
Over the past five years, $10.6 billion, or about 40% of NIAID's budget to external U.S. institutions, went to states that voted for Trump in the 2024 presidential election, the analysis found. Research suggests that every dollar spent by NIH generates from $2.50 to $8 in economic activity.
That money is key to advancing medicine as well as careers in science. Most students and postdoctoral researchers rely on the funding and prestige of NIH grants to launch into the profession.
New Drugs and Global Influence
The NIH pays for most of the basic research globally into new drugs. The private sector relies on this public funding; researchers at Bentley University found that NIH money was behind every new pharmaceutical approved from 2010 through 2019.
That includes therapies for kids with RSV, COVID-19 vaccines and Ebola treatments, all of which have key patents based on NIAID-funded research.
Research from NIAID has also improved treatment for chronic diseases. New understandings of inflammation from NIAID-funded research has led to cutting-edge research into cures for Crohn's disease and ulcerative colitis, and a growing body of evidence shows how viruses can have long-term impacts, from multiple sclerosis to long COVID. When private companies turn that research into blockbuster drugs, the public benefits from new treatments, as well as jobs and economic growth.
The weight of NIAID's funding also allows it to play quieter roles that have been essential to advancing science and the United States' role in biomedicine, several people said.
The institute brings together scientists who are normally competitors to share findings and tackle big research questions. Having that neutral space is essential to pushing knowledge forward and ultimately spurring breakthroughs, said Matthew Rose of the Human Rights Campaign, who has served on multiple NIH advisory boards. "Academic bodies are very competitive with one another. Having NIH pull the grantees together is helpful to make sure they talk to one another and share research."
NIAID also funds researchers internationally, ensuring the U.S. continues to have an influential voice in global conversations about biosecurity.
Nancy Sullivan, a former senior investigator at NIAID, said that NIAID's power is its ability to invest in a broad understanding of human health. "It's the basic research that allows us to develop treatments," she said. "You never know which part of fundamental research is going to be the lynchpin for curing a disease or defining a disease so you know how to treat it," she said.
Sullivan should know: It was her work at NIAID that led four years ago to the first approved treatment for Ebola.
For years, it was a mystery: Seemingly out of the blue, therapists would feel like they'd tripped some invisible wire and become a target of UnitedHealth Group.
A company representative with the Orwellian title "care advocate" would call and grill them about why they'd seen a patient twice a week or weekly for six months.
In case after case, United would refuse to cover care, leaving patients to pay out-of-pocket or go without it. The severity of their issues seemed not to matter.
Around 2016, government officials began to pry open United's black box. They found that the nation's largest health insurance conglomerate had been using algorithms to identify providers it determined were giving too much therapy and patients it believed were receiving too much; then, the company scrutinized their cases and cut off reimbursements.
By the end of 2021, United's algorithm program had been deemed illegal in three states.
But that has not stopped the company from continuing to police mental healthcare with arbitrary thresholds and cost-driven targets, ProPublica found, after reviewing what is effectively the company's internal playbook for limiting and cutting therapy expenses. The insurer's strategies are still very much alive, putting countless patients at risk of losing mental healthcare.
Optum, its subsidiary that manages its mental health coverage, is taking aim at those who give or get "unwarranted" treatment, flagging patients who receive more than 30 sessions in eight months. The insurer estimates its "outlier management" strategy will contribute to savings of up to $52 million, according to company documents.
The company's ability to continue deploying its playbook lays bare a glaring flaw in the way American health insurance companies are overseen.
While the massive insurer — one of the 10 most profitable companies in the world — offers plans to people in every state, it answers to no single regulator.
The federal government oversees the biggest pool: most of the plans that employers sponsor for their workers.
States are responsible for plans that residents buy on the marketplace; they also regulate those funded by the government through Medicaid but run through private insurers.
In essence, more than 50 different state and federal regulatory entities each oversee a slice of United's vast network.
So when a California regulator cited United for its algorithm-driven practice in 2018, its corrective plan applied only to market plans based in California.
When Massachusetts' attorney general forced it to restrict the system in 2020 for one of the largest health plans there, the prosecutor's power ended at the state line.
And when New York's attorney general teamed up with the U.S. Department of Labor on one of the most expansive investigations in history of an insurer's efforts to limit mental healthcare coverage — one in which they scored a landmark, multimillion-dollar victory against United — none of it made an ounce of difference to the millions whose plans fell outside their purview.
It didn't matter that they were all scrutinizing the insurer for violating the same federal law, one that forbade companies from putting up barriers to mental health coverage that did not exist for physical health coverage.
For United's practices to be curbed, mental health advocates told ProPublica, every single jurisdiction in which it operates would have to successfully bring a case against it.
"It's like playing Whac-A-Mole all the time for regulators," said Lauren Finke, senior director of policy at the mental health advocacy group The Kennedy Forum. The regulatory patchwork benefits insurance companies, she said, "because they can just move their scrutinized practices to other products in different locations."
Now internal documents show that United, through its subsidiary Optum, is targeting plans in other jurisdictions, where its practices have not been curbed. The company is focused on reducing "overutilization" of services for patients covered through its privately contracted Medicaid plans that are overseen by states, according to the internal company records reviewed by ProPublica. These plans cover some of the nation's poorest and most vulnerable patients.
United administers Medicaid plans or benefits in about two dozen states, and for more than 6 million people, according to the most recent federal data from 2022. The division responsible for the company's Medicaid coverage took in $75 billion in revenue last year, a quarter of the total revenue of its health benefits business, UnitedHealthcare.
UnitedHealthcare told ProPublica that the company remains compliant with the terms of its settlement with the New York attorney general and federal regulators. Christine Hauser, a spokesperson for Optum Behavioral Health, said its process for managing healthcare claims is "an important part of making sure patients get access to safe, effective and affordable treatment." Its programs are compliant with federal laws and ensure "people receive the care they need," she said. One category of reviews is voluntary, she added; it allows providers to opt out and does not result in coverage denials.
ProPublica has spent months tracking the company's efforts to limit mental health costs, reviewing hundreds of pages of internal documents and court records, and interviewing dozens of current and former employees as well as scores of providers in the company's insurance networks.
One therapist in Virginia said she is reeling from the costly repercussions of her review by a care advocate. Another in Oklahoma said she faces ongoing pressure from United for seeing her high-risk patients twice a week.
"There's no real clinical rationale behind this," said Tim Clement, the vice president of federal government affairs at the nonprofit group Mental Health America. "This is pretty much a financial decision."
Former care advocates for the company told ProPublica the same as they described steamrolling providers to boost cost savings.
One said he felt like "a cog in the wheel of insurance greed."
Under ALERT
The year 2008 was supposed to mark a revolution in access to mental healthcare.
For decades, United and other insurers had been allowed to place hard caps on treatment, like the number of therapy sessions. But after Congress passed the Mental Health Parity and Addiction Equity Act, insurers could no longer set higher copays for behavioral services or more strictly limit how often patients could get them; insurers needed to offer the same access to mental healthcare as to physical care. The law applied to most plans, regardless of whether federal or state regulators enforced it.
As access to services increased, so did insurers' costs. Company documents show United was keenly aware of this threat to its bottom line.
But there was a loophole: Insurers could still determine what care was medically necessary and appropriate.
Called ALERT, the algorithmic system was created years earlier to identify patients at risk of suicide or substance use. The company redeployed it to identify therapy overuse.
Company and court filings reveal that ALERT comprised a suite of algorithms — totaling more than 50 at one point — that analyzed clinical and claims data to catch what it considered unusual mental health treatment patterns, flagging up to 15% of the patients receiving outpatient care.
The algorithms could be triggered when care met the company's definition of overly frequent, such as when patients had therapy sessions twice a week for six weeks or more than 20 sessions in six months. Therapists drew scrutiny if they provided services for more than eight hours a day, used the same diagnosis code with most clients or worked on weekends or holidays — even though such work is often necessary with patients in crisis.
The system was originally designed to save lives, said Ed Jones, who co-developed the algorithm program when he worked as an executive at PacifiCare Behavioral Health, which later merged with United. Using ALERT to limit or deny care was "perverting a process that was really pretty good," he told ProPublica.
Once patients or therapists were flagged, care advocates, who were licensed practitioners, would "alert" providers, using intervention scripts to assess whether care was medically necessary. The calls felt like interrogations, therapists told ProPublica, with the predetermined conclusion that their therapy was unnecessary or excessive.
ProPublica spoke with seven former employees from Optum who worked with the ALERT system from 2006 through 2021. They requested not to be named in order to speak freely, some citing fears of retaliation.
Even though the reviews were purportedly intended to identify cases where care was inappropriate or violated clinical standards, several former care advocates said these instances were rare. Instead, they questioned care if it passed an allotted number of sessions.
"It had to be really extreme to help the client be able to continue with the care," said one former care advocate, who was troubled by the practice. "Not everyone with depression is going to be suicidal, but they still need therapy to support them."
The advocates often overruled a provider's expertise, a former team manager said. "There was always this feeling, ‘Why are we telling clinicians what to do?'" he said. "I didn't think it was OK that we were making decisions like that for people."
If the advocates found fault with therapists' explanations — or couldn't persuade them to cut back on care — they elevated the case to a peer-to-peer review, where a psychologist could decide to stop covering treatment.
According to court records, regulators alleged United doled out bonuses to care advocates based on productivity, such as the number of cases handled, and pushed workers to reduce care by modifying a therapist's treatment or referring therapists to peer review in 20% of assigned cases.
At one point, care advocates were referring 40%, regulators alleged in court filings. Each peer review tended to last less than 12 minutes, offering providers little time to prove they had a "clear and compelling" reason to continue treatment.
Former advocates described feeling like parts of a machine that couldn't stop churning. "Literally, we had to tell the company when we were going to the restroom," one advocate said, "and so you would do that and come back and your manager would say, ‘Well, that was a little long.'"
The former workers told ProPublica they were pressured to keep calls brief; the rush added to the tension as therapists pushed back in anger.
"There was an expiration date on those jobs because there was such a pull on you emotionally," one former care advocate said.
Three of them quit, they told ProPublica, citing damage to their own mental health.
All concluded that while United may not have set official caps on coverage, it had done so in practice by limiting mental health services more stringently than medical care. Therefore, it was breaking the federal parity law.
While California and Massachusetts got United to scale back its use of ALERT within their jurisdictions, New York was able to stretch its reach by teaming up with the U.S. Department of Labor to investigate and sue the insurer. Together, they found that from 2013 through 2020, United had denied claims for more than 34,000 therapy sessions in New York alone, amounting to $8 million in denied care.
By using ALERT to ration care, United calculated that it saved the company about $330 per member each time the program was used, the regulators said in court records. Cut off from therapy, some patients were hospitalized. The regulators did not specifically address in court filings whether the treatment denials met medical guidelines.
The company, which denied the allegations and did not have to admit liability or wrongdoing, agreed to pay more than $4 million in restitution and penalties in 2021. Notably, it also agreed to not use ALERT to limit or deny care.
The final terms of the settlement, however, only applied to plans under New York and federal regulators' jurisdiction.
Rebranded Reviews
ProPublica has reviewed documents behind Optum's ALERT and Outpatient Care Engagement programs. Credit: Obtained by ProPublica
In the three years since the settlement, the company has quietly rebranded ALERT.
The Outpatient Care Engagement program continues to use claims and clinical data to identify patients with "higher-than-average intensity and/or frequency of services," according to internal company documents, to ensure "that members are receiving the right level of care at the right time."
Up to 10% of cases are flagged for scrutiny, public company documents show. If care advocates take issue with a case, they can elevate it to a peer review, which can result in a denial.
Care advocates are even calling therapists from the same phone number.
Overseen by the former director of ALERT, the team's more than 50 care advocates are tasked with ensuring that "outpatient care follows clinical and coverage guidelines" and "reduces overutilization and benefit expense when appropriate," according to company documents.
The team conducts thousands of reviews each month, targeting plans that are mostly regulated by states and fall outside of the jurisdictions of previous sanctions. Patients impacted include workers with fully insured plans and people covered by Medicaid.
Nearly 1 in 3 adults in the Medicaid program has a mental health condition, and a fifth of its members have a substance use disorder. "This is probably disproportionately sweeping up those that are most distressed, most ill and most in need of care," Clement said.
Private insurers that manage Medicaid plans, also known as managed care organizations, are often paid a fixed amount per person, regardless of the frequency or intensity of services used. If they spend less than the state's allotted payment, plans are typically allowed to keep some or all of what remains. Experts, senators and federal investigators have long raised concerns that this model may be incentivizing insurers to limit or deny care.
"They basically manage the benefits to maximize their short-term profit," said David Lloyd, chief policy officer with the mental health advocacy group Inseparable and an expert on state-level mental health parity laws.
State regulators are supposed to be making sure private insurers that manage Medicaid plans are following the mental health parity laws. But this year, a federal audit found that they were failing to do so. "They are not well designed to essentially be watchdogs," Lloyd said. "There's very little accountability. Insurers can run roughshod over them."
The internal records reviewed by ProPublica show the plans and geographic areas now scrutinized by the rebranded program. The team conducts two types of reviews, those considered "consultation" and those that question medical necessity.
For the first kind, the team flags members with high use (more than 30 sessions in eight months) or high frequency (twice-a-week sessions for six weeks or more) to engage their providers in "collaborative" conversations about the treatment plan.
Company documents reveal striking similarities between Optum's ALERT and Outpatient Care Engagement programs. Credit: Obtained by ProPublica
Internal records indicate that the company uses this "consultation" model for about 20 state Medicaid programs, including Washington, Minnesota, Mississippi, Virginia and Tennessee. The company is also deploying the program with Medicaid plans in Massachusetts and, as of the fourth quarter of this year, New York, which are outside of the jurisdiction of the earlier state agreements.
While the Department of Labor does not have jurisdiction over Medicaid, a spokesperson said it "would be concerned about ‘consultation' reviews that are conducted in a way that violates [the mental health parity act]." The department did not comment on whether it was investigating the insurer, as a matter of agency policy.
Company records show Optum is applying its more stringent review method, questioning medical necessity, to psychological testing services and a type of therapy to treat children with autism, known as applied behavior analysis, for people with Medicaid coverage in about 20 states. It is doing the same for routine therapy for its members with dual Medicare-Medicaid plans in about 18 states and Washington, D.C. Such plans are largely overseen by the Centers for Medicare & Medicaid Services, the federal agency responsible for overseeing both Medicare and Medicaid programs. While the dual plans are not subject to federal mental health parity laws, a CMS spokesperson said the agency was taking steps to "ensure that people enrolled in these plans have timely access to care."
The internal company records reveal that Optum has continued to use quotas with its medical necessity reviews, setting productivity targets for how many cases its employees scrutinize. According to records from this year, the target was 160 reviews per employee, which the company exceeded with 180 reviews per employee.
Several state agencies that oversee Medicaid programs, including those in New York and Massachusetts, told ProPublica that they follow federal mental health parity laws and have strong monitoring practices to ensure that the private insurers that manage benefits are in compliance.
Katie Pope, a spokesperson for Washington's healthcare Authority, told ProPublica that ALERT was discontinued three years ago but did not directly respond to questions about the current iteration of the program. Scott Peterson, a spokesperson for Minnesota's Human Services Department, said that while United's policies were compliant with federal parity laws, the company's contract would expire at the end of the year. Last May, the state blocked for-profit insurers, like United, from participating in its Medicaid program.
Amy Lawrence, a spokesperson for Tennessee's Medicaid program, said United's outlier review practice entailed "voluntary collaborative conversations on best practices" and did not question the medical necessity of services nor result in denials of treatment. "There are no adverse consequences for providers who elect not to participate," she said.
Mississippi's, Louisiana's and Virginia's state Medicaid agencies did not respond to ProPublica's questions. (Read all state responses.)
In response to ProPublica's questions about its oversight of state Medicaid programs, a spokesperson for CMS said it was "actively engaged with states and other stakeholders to improve compliance and oversight of parity requirements." (Read the full responses of federal agencies.)
Hauser, the spokesperson for Optum, told ProPublica that the company is committed to working with state Medicaid programs to ensure access to effective and necessary care. She said its new program was separate from ALERT, which she said had been discontinued. (She did not explain why the original ALERT program appears to be still operational in Louisiana, according to a recent company manual.) When the team conducts medical necessity reviews, she said, they are compliant with mental health parity law. (Read the company's full response.)
Ringing Phones
Therapists who underwent the reviews told ProPublica that they felt the practice was intended to discourage them from providing necessary care, interfering with their ability to treat their patients.
This year, Oklahoma therapist Jordan Bracht received multiple calls from the team related to the care of two patients, who were both on United's dual Medicare-Medicaid plan. "If we don't hear back from you within a week," a care advocate said in a voice message, "then the case will be forwarded to the peer review process to make a decision based upon the information available."
Both of Bracht's patients had diagnoses of dissociative identity disorder and required therapy twice a week. "Many of my clients are suicidal and would be hospitalized if I had to cut down the care," Bracht told ProPublica.
Reviewers pushed for end dates for their therapy. "They really wanted me to nail down a discharge date," she said. "We are really trying to keep this person alive, and it felt like they were applying their one-size-fits-all model. It doesn't feel right."
Virginia therapist Chanelle Henderson got a voice message in 2022 from the same number about her care of a patient with state Medicaid coverage. "We'd like to complete a clinical review," the caller said. "We'll follow up with one more call before the case is referred to the peer review process."
When Henderson called back, a reviewer informed her that her practice had been flagged for providing longer sessions. Henderson tried to explain they were necessary to treat trauma, her practice's specialty. "She had no trust in me as a clinician," Henderson said of the reviewer.
The inquiry progressed to questions about other patients, including one who was being treated by a therapist under Henderson's supervision. The reviewer said that the company did not cover sessions of supervised therapists at practices with less than 12 therapists. At the time, Henderson's practice had eight.
The reviewer elevated her case, triggering an aggressive audit of the entire practice going back two years that threatened to shut it down.
Citing issues with supervision and longer sessions, United demanded the practice pay back about $20,000 for services it had already provided. Henderson and her business partner pushed back, hiring a biller to help submit hundreds of pages of additional notes and documentation. They also pointed out that during the audit, the company had even changed its policy to allow smaller practices to supervise therapists. United eventually decreased the penalty by half. Neither Optum, United nor Virginia's Medicaid program directly responded to ProPublica's questions about the case.
Bethany Lackey, who co-founded the practice with Henderson, said that the reviews felt like a pretext for additional scrutiny. "It's all set up in order to catch someone doing something so that they can take back payments," she said. "We all know that behind it is this more malicious intent of getting their money back."
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For three years during the coronavirus pandemic, the federal government gave Texas and other states billions of dollars in exchange for their promise not to exacerbate the public health crisis by kicking people off Medicaid.
When that agreement ended last year, Texas moved swiftly, kicking off more people faster than any other state.
Officials acknowledged some errors after they stripped Medicaid coverage from more than 2 million people, most of them children. Some people who believe they were wrongly removed are desperately trying to get back on the state and federally funded health care program, adding to a backlog of more than 200,000 applicants. A ProPublica and Texas Tribune review of dozens of public and private records, including memos, emails and legislative hearings, clearly shows that those and other mistakes were preventable and foreshadowed in persistent warnings from the federal government, whistleblowers and advocates.
Texas' zealousness in removing people from Medicaid was a choice that contradicted federal guidelines from the start. That decision was devastating in Texas, which already insures a smaller percentage of its population through Medicaid than almost any other state and is one of 10 that never expanded eligibility after the passage of the Affordable Care Act.
"The difference in how Texas approached this compared to a lot of other states is and was very striking. It wanted everybody off, anybody extra off, even though we knew that meant that state systems would buckle under the pressure," said Erin O'Malley, a senior policy analyst with Every Texan, a left-leaning statewide advocacy group.
Medicaid rolls swelled nationally during the pandemic, with tens of millions of people added to the program and no one removed. In Texas, the number of people receiving Medicaid benefits grew by more than 50%, to 6 million. When the federal government stopped requiring continuous coverage in April 2023, states had to determine who was no longer eligible.
The question wasn't whether to remove people but instead how to do it in a way that caused the least disruption and ensured those who qualified stayed on.
To that end, the federal Centers for Medicare and Medicaid Services advised states to proceed slowly and rely heavily on existing government data to automatically renew eligible residents, steps the agency believed would prevent poor families from wrongly losing coverage. Congress gave states a year for the so-called "Medicaid unwinding."
But Texas opted for speed, launching reviews of about 4.6 million cases in the first six months. It also decided against the more vigorous use of automatic renewals urged by the federal government, forcing nearly everyone to resubmit documents proving they qualified. Nearly 1.4 million of those who lost coverage were disenrolled for bureaucratic reasons like failing to return a form or completing one incorrectly, not because they weren't eligible.
The decision to buck federal government guidelines was one of many that led to serious repercussions for Texas residents who rely on the program.
Among them were children forced to forgo or postpone lifesaving operations such as heart surgeries, said Dr. Kimberly Avila Edwards, an Austin pediatrician and Texas representative for the American Academy of Pediatrics. Children with severe diseases such as sickle cell anemia, as well as those with neurodevelopmental delays and autism, also unnecessarily lost critical care.
One of her colleagues treated a boy with a rare heart condition who lost Medicaid coverage in January after his parents failed to sign a form that even his caseworker was not aware the family needed to complete.
The boy's parents couldn't afford his $6,000 monthly pulmonary hypertension medication, nor could they pay for an ultrasound that would help determine whether he could survive without the drugs, said Avila Edwards, who declined to identify him because of medical privacy laws.
"If we have children who are less healthy, who are unable to get the preventative care they need for their chronic medical conditions, that fundamentally should raise concern for all of us," she said.
The boy was eventually reenrolled in Medicaid after Texas pediatricians persuaded the state health agency to restore his coverage, Avila Edwards said.
Thomas Vasquez, a spokesperson for the Texas Health and Human Services Commission, acknowledged that the agency "learned many lessons" and is working to improve eligibility processes. HHSC representatives defended the rollout, saying that the agency conducted community outreach and hired more than 2,200 employees.
Texas' approach to the Medicaid unwinding reflected the state's long-standing conservative ideology regarding the government-subsidized program, said Simon Haeder, an associate professor at Texas A&M University's School of Public Health.
As attorney general more than a decade ago, Gov. Greg Abbott helped lead a successful lawsuit against the federal government to ensure states didn't have to cover more residents under Medicaid as part of the Affordable Care Act. Since then, Abbott and state lawmakers have continued to severely limit the program to mostly children, pregnant women and disabled adults. Poor adults aren't typically eligible for Medicaid unless they have children. Parents of two kids must earn a combined income of less than $285 monthly to qualify for coverage.
A spokesperson for Abbott declined an interview on his behalf and did not respond to a request for comment on the state's handling of the unwinding.
Texas' stance during the unwinding, Haeder said, was, "We don't do anything illegal, but we want to get our program as fast as we can down to what it was before the pandemic."
Ignored Warnings
It was inevitable that the COVID-19 public health emergency would eventually end, as would the prohibition against pushing people off the rolls. Federal officials worried about the effects of the unwinding on vulnerable Americans almost from the start. In fact, the Biden administration repeatedly extended the emergency declaration, even after the peak of the crisis, to maintain safeguards that included keeping millions of low-income people on Medicaid.
Once the emergency officially ended in April 2023, states were free to cull their rolls. In preparation, federal officials advised states not to review more than 11% of their caseloads each month, cautioning that moving more quickly could overwhelm their systems and lead to the wrongful removal of eligible people.
But that was guidance, not a requirement, and Texas chose a far more aggressive plan.
In the first month of the unwinding, the state started the review process for about a million cases, or 17% of its caseload.
The federal government in May 2023 pressed Texas on why the state was moving so quickly. State officials downplayed the concerns, writing in an email obtained by the news organizations that they were frontloading people who most likely no longer qualified and were reviewing entire households at once.
Within the first four months of the unwinding, the state dropped more than 600,000 people from Medicaid. The vast majority were removed not because the state determined they were no longer eligible but for reasons such as failing to provide the proper documents in time.
That July, U.S. Health and Human Services Secretary Xavier Becerra called on Texas and other states to increase the number of eligible people they automatically renewed with existing government data. He warned in a letter that his agency would take action against states that were not complying.
In the same week, a group of employees anonymously emailed HHSC Executive Commissioner Cecile Young and media organizations, claiming senior management had alerted them that tens of thousands of people had improperly lost Medicaid due to the agency's poor handling of the unwinding. Young's chief of staff responded in an email that she couldn't address the allegations of unidentified whistleblowers.
Texas alerted the federal government days later that it had erroneously dropped nearly 100,000 people, according to records obtained by the news organizations.
In August 2023, CMS once again implored the state to stop requiring eligible people to resubmit paperwork proving they still qualified. The federal agency said it appeared that many people didn't know they needed to reenroll, didn't understand the forms or faced obstacles in submitting the required information.
Other states that had taken a similar approach, such as Pennsylvania and Maine, made significant changes. Not Texas.
The state agency flagged to CMS last September that more than 30,000 kids lost their coverage, even though most of them should have been moved from Medicaid to the Children's Health Insurance Program, according to emails the news organizations obtained through the state's Public Information Act.
State officials later told the news organizations that 95,000 people had been wrongly removed, instead of close to 130,000, as originally reported to CMS. Asked why the figures had decreased, a spokesperson said the agency "provided approximate numbers as we worked to resolve the issue." Agency representatives said the state quickly reinstated coverage and implemented changes to prevent further improper denials. They did not provide specifics.
Alarmed by the deluge of disenrollments, advocacy groups, health providers and newspaper editorial boards began calling on the state last summer to pause the unwinding and ensure people were not incorrectly losing coverage. It did not do so.
In October, after Texas had already disenrolled more than 1.2 million people, the state gave about 400,000 people who likely qualified for Medicaid an extra month to submit paperwork, according to an agency spokesperson.
Still, problems persisted.
In December, Becerra appealed directly to Abbott and eight other governors of states with the highest shares of children who had lost coverage. Texas accounted for nearly a quarter of all children in the U.S. who had lost Medicaid or CHIP during the unwinding, Becerra wrote. He again urged the state to employ a series of actions, including automatically renewing eligible people.
Without providing details, Becerra said the federal government would not hesitate to take action against states that did not comply with federal requirements.
'A One-Two Punch'
Three months later, Micaela Hoops' children lost the government-subsidized health insurance for which they had qualified their entire lives. After years of not having to renew their Medicaid coverage under the pandemic rules, the 37-year-old North Texas mother said she was confused about when she was required to reapply and missed the deadline to provide proof of the family's income.
In other states, the kids might have been automatically renewed using other government information, like quarterly payroll data reported by employers to the state or federal tax records. Instead, Hoops had to frantically reapply seven days after the coverage lapsed in March, submitting 24 pay statements for her husband's weekly wages as a marketing director for a real estate company. This put the family at the back of a monthslong waiting list.
During that time, Hoops, a stay-at-home mom who homeschools the children, had to take her eldest son to the emergency room for a debilitating migraine. The visit came with a $3,000 bill that she and her husband could not pay. A few months later, the 14-year-old broke his nose while playing with his brother on a trampoline. She paid a few hundred dollars out of pocket for the doctor but couldn't afford the CT scan required to reset his nose.
More than 100 days after Hoops reapplied, the state restored her children's coverage retroactively. She hopes Medicaid will cover the hospital visit, but her son's nose remains crooked.
"My children didn't deserve to go without insurance," Hoops said. "They're kids. They have medical emergencies, things happen, and they deserve to be taken care of."
While Hoops' children got their Medicaid back, some families that believe they wrongly lost Medicaid are still waiting after being forced to reapply. Texas' median processing time for Medicaid applications is almost three months, according to a recent agency briefing obtained by the news organizations. This exceeds the federal limit of 45 days for most cases.
The sudden suspension of health insurance for a population the size of New Mexico has had additional ramifications in Texas, including higher treatment costs for hospitals and clinics forced to take on more uninsured patients.
Texas Children's Hospital in Houston, the largest pediatric hospital in the country, laid off employees this year after significant budget shortfalls. A hospital spokesperson declined to comment, but, in a recent financial filing, the hospital attributed some of the challenges to losing Medicaid patients during the state's unwinding process.
Across the state, some safety net clinics reported a 30% decrease in Medicaid revenue due to the unwinding, said Jana Eubank, who heads the Texas Association of Community Health Centers. She said the extra costs added to challenges for the already financially strapped facilities.
"Some centers are having to lay off staff. Some centers are furloughing staff," Eubank said. "I've got a couple of CEOs that aren't taking a salary right now. I've had centers that are unfortunately having to cut back certain services or extended hours, like behavioral health services, dental services, just because they can't afford to continue to offer that care."
Separately, some families that were pushed off Medicaid are also waiting more than a month for food assistance because Texas uses the same eligibility system to process applications for both.
San Antonio Food Bank CEO Eric Cooper said the nonprofit was crushed by demand this summer when families faced sudden medical bills, kids were out of school and the state had a backlog of more than 277,000 food stamp applications. The situation worsened when Texas declined to participate in a federal nutrition program, turning down an estimated $450 million that could have helped feed nearly 3.8 million poor children during the summer. HHSC officials said they could not get the program running in time.
"It's felt like a one-two punch, the double whammy," Cooper said.
"We haven't really felt any relief since the Medicaid unwinding and the official end of the public health emergency," he added. "It's still an emergency. It's still a crisis."
Federal Investigation
In May, after Texas' unwinding ended, the federal government launched an investigation into long waits faced by people who had applied for Medicaid coverage. Addressing these persistent delays was especially important because they affected eligible people who lost coverage in the past year, Sarah deLone, director of CMS' Children and Adults Health Programs Group, wrote in a letter to the state.
Former federal officials and health policy experts called the probe a significant step by the agency, which typically works with states behind the scenes.
But CMS has few options to hold Texas accountable if it finds wrongdoing, said Joan Alker, executive director of the Center for Children and Families at Georgetown University in Washington, D.C. The Biden administration's major enforcement tool is yanking federal funding, but that could cause low-income people to lose health insurance and invite a lawsuit from Texas, Alker said. And the investigation likely won't go anywhere if Donald Trump wins in November, she said, since the former president previously encouraged states to restrict Medicaid access and promised to undo the Affordable Care Act entirely.
CMS spokesperson Stephanie Rossy declined to comment directly on its investigation or on Texas' handling of the unwinding. But in a statement she wrote that "states' choices have real consequences for eligible people's ability to stay covered."
Texas officials also declined to discuss the probe, but in a letter to the federal agency two weeks after the May investigation announcement, the state's Medicaid director, Emily Zalkovsky, acknowledged that Texas experienced "severe operational and systems challenges" during the unwinding.
Although the federal probe was welcomed by advocacy groups, as well as some health care providers and Texas families, it's unlikely to immediately help eligible people who lost Medicaid during the unwinding and are waiting to get back on.
While Hoops' children have regained coverage, she believes that what her family endured reflects state leaders' attitudes toward low-income people.
"Maybe they didn't realize they were making cruel decisions," she said. Still, she feels like the state's mentality is basically, "Well, you just shouldn't be dependent on us."
The Food and Drug Administration issued a rule on Monday that brings new scrutiny to a vast array of critical lab tests, including some popular prenatal genetic screenings, that reach patients without any federal agency checking to ensure they work the way their makers claim.
"This is a significant step forward," said Peter Lurie, president and executive director of the Center for Science in the Public Interest and a former FDA associate commissioner. These tests have "always been one of the remaining gaping holes in the FDA regulatory structure. And it's great to see that the agency has taken concrete steps to close it."
The move comes after decades of debate and stalled legislation on LDTs, which also include certain cancer screenings as well as some tests for rare diseases. Because these tests are designed, manufactured and used in a single lab, they escape most federal oversight over marketing and accuracy.
A large coalition of labs, associations and academic medical centers have long pushed back on the prospect of increased FDA involvement in these tests. It would be too onerous, they've argued, and it jeopardizes patient access to health services.
One of nearly 7,000 comments submitted in response to the draft rule came from the Association for Molecular Pathology, representing a wide-ranging group of professionals associated with laboratory testing. The FDA's proposed changes "would result in laboratory professionals being treated as product manufacturers instead of board-certified healthcare providers," the association's president wrote, and it would "unequivocally hinder and harm patient care."
The agency's hands-off approach dates back to an era when these tests were a relatively small, low-risk sector of the health care system. Now, they are a much bigger player and include high-stakes tests made by commercial companies. While the Centers for Medicare and Medicaid Services reviews lab operations, it doesn't check whether the tests themselves are clinically valid. The tests aren't registered with the federal government, so nobody knows how many exist. In 2021, Pew Charitable Trusts estimated that 12,000 labs are likely to deploy them, many of which process thousands a day.
The ProPublica story on prenatal genetic screenings referenced by the FDA revealed how the agency didn't check the tests before they reached patients or evaluate marketing claims made by the companies that sell them. Companies aren't required to publicly report when a test gets it wrong, the investigation found, and no federal agency can recall faulty screenings. The story detailed how false positives, false negatives and indeterminate results can have painful consequences for expecting parents. (We also published a guide to the prenatal tests to help families with their questions.)
Our coronavirus investigation showed how a Chicago-based company with state and local contracts in Nevada sold testing services that were unreliable from the start. As it became clear that the lab was telling infected people that they had tested negative for the virus, company officials nonetheless expanded the reach of the lab's testing. The company declined to comment for ProPublica's previous stories on these problems.
The rule will go into effect over a four-year period. Within two years, test-makers will be expected to meet registration and listing requirements, among others, which is "a critical part of this rule," according to Cara Tenenbaum, a former FDA policy adviser whose consultancy has advocated for more active oversight.
"At least knowing what is out there will be huge," she said in an email.
High-risk tests will need to meet new FDA review requirements before reaching the marketplace starting in November 2027. Moderate-risk and low-risk tests will need to do the same starting in May 2028. It's unclear how prenatal screening tests would be categorized.
The agency generally will not enforce some or all requirements for certain LDTs, including tests that were first marketed before the rule was issued and have not since been modified or have been modified in certain limited ways.
The agency will also generally not enforce some or all requirements for tests used within the Veterans Health Administration or the Department of Defense, as well as certain tests that meet other narrow conditions.
Nonetheless, the rule marks a massive shift in the FDA's approach to a sector that touches millions. "The agency cannot stand by while Americans continue to rely on results of these tests without assurance that they work," FDA commissioner Robert Califf said in an agency news release.
The final rule, he added, aims to "help ensure that important health care decisions are made based on test results that patients and health care providers can trust."
The FDA tried to rein in the lab tests a decade ago, issuing a draft guidance in 2014. That prompted a two-year backlash from opponents. The agency ultimately dropped it.
Laurie Menser, chief executive of the Association for Molecular Pathology, said in an emailed statement that the association is "very disappointed" in the new rule.
"It's unfortunate the agency continues to overstep its authority and bypass the country's legislative process," Menser said. "AMP is currently reviewing the different aspects of the rule and assessing the many implications for our members and patient care."
Lurie, who was closely involved with the FDA effort to address the tests a decade ago, said the rule has been a long time coming. "People had identified this problem a very long time ago, and wanted to take action, but found themselves stymied by opposition," he said.
"I think that it shows real courage on the part of the agency, as well as commitment to the public health, to take this step," he added.
Anna.clark@propublica.org is a Detroit-based reporter for ProPublica, covering stories in Michigan and the Midwest. She is the author of "The Poisoned City: Flint's Water and the American Urban Tragedy.
Cigna tracks every minute that its staff doctors spend deciding whether to pay for healthcare. Dr. Debby Day said her bosses cared more about being fast than being right.
This article was published on Monday, April 29, 2024 in ProPublica.
In late 2020, Dr. Debby Day said her bosses at Cigna gave her a stark warning. Work faster, or the company might fire her.
That was a problem for Day because she felt her work was too important to be rushed. She was a medical director for the health insurer, a physician with sweeping power to approve or reject requests to pay for critical care like life-saving drugs or complex surgeries.
She had been working at Cigna for nearly 15 years, reviewing cases that nurses had flagged for denial or were unsure about. At Cigna and other insurers, nurses can greenlight payments, but denials have such serious repercussions for patients that many states require that doctors make the final call. In more recent years, though, Day said that the Cigna nurses' work was getting sloppy. Patient files that nurses working in the Philippines sent to her, she said, increasingly had errors that could lead to wrongful denials if they were not corrected.
Day was, in her own words, persnickety. If a nurse recommended denying coverage for a cancer patient or a sick baby, she wanted to be certain it was the right thing to do. So Day said she researched guidelines, read medical studies and scrutinized patient medical records to come to the best decision. This took time. She was clearing fewer cases than many of her peers.
Some of her colleagues quickly denied requests to keep pace, she said. All a Cigna doctor had to do was cut and paste the denial language that the nurse had prepared and quickly move on to the next case, Day said. This was so common, she and another former medical director said, that people inside Cigna had a term for these kinds of speedy decisions: "click and close."
In late 2020, Dr. Debby Day said her bosses at Cigna gave her a stark warning. Work faster, or the company might fire her.
That was a problem for Day because she felt her work was too important to be rushed. She was a medical director for the health insurer, a physician with sweeping power to approve or reject requests to pay for critical care like life-saving drugs or complex surgeries.
She had been working at Cigna for nearly 15 years, reviewing cases that nurses had flagged for denial or were unsure about. At Cigna and other insurers, nurses can greenlight payments, but denials have such serious repercussions for patients that many states require that doctors make the final call. In more recent years, though, Day said that the Cigna nurses' work was getting sloppy. Patient files that nurses working in the Philippines sent to her, she said, increasingly had errors that could lead to wrongful denials if they were not corrected.
Day was, in her own words, persnickety. If a nurse recommended denying coverage for a cancer patient or a sick baby, she wanted to be certain it was the right thing to do. So Day said she researched guidelines, read medical studies and scrutinized patient medical records to come to the best decision. This took time. She was clearing fewer cases than many of her peers.
Some of her colleagues quickly denied requests to keep pace, she said. All a Cigna doctor had to do was cut and paste the denial language that the nurse had prepared and quickly move on to the next case, Day said. This was so common, she and another former medical director said, that people inside Cigna had a term for these kinds of speedy decisions: "click and close."
"Deny, deny, deny. That's how you hit your numbers," said Day, who worked for Cigna until the late spring of 2022. "If you take a breath or think about any of these cases, you're going to fall behind."
In a written response to questions, Cigna said its medical directors are not allowed to "rubber stamp" a nurse's recommendation for denial. In all cases, the company wrote, it expects its doctors to "perform thorough, objective, independent and accurate reviews in accordance with our coverage policies." The company said it was unaware of the use of the term "click and close" and that "such behavior would not be tolerated."
During Day's final years at Cigna, the company meticulously tracked the output of its medical directors on a monthly dashboard. Cigna shared this spreadsheet with more than 70 of its doctors, allowing them to compare their tally of cases with those of their peers. Day and two other former medical directors said the dashboard sent a message loud and clear: Cigna valued speed. (ProPublica and The Capitol Forum found these other former Cigna doctors independently; Day did not refer them.) One of Day's managers in a written performance evaluation called the spreadsheet the "productivity dashboard."
Measuring the speed and output of employees is common in many industries, from fast food to package delivery, but the use of these kinds of metrics in health care is controversial because the stakes are so high. It's one thing if a rushed server forgets the fries with your burger. It's another entirely if the pressure to act fast leads to wrongful denials of payment for vital care. Walgreens in 2022 dropped measurements of its pharmacists' speed from their performance reviews after some alleged that practice could lead to dangerous mistakes.
ProPublica and The Capitol Forum examined Cigna's productivity dashboards for medical directors from January and February 2022. These spreadsheets tallied the number of cases each medical director handled. Cigna gave each task a "handle time," which the company said was the average amount of time it took its medical directors to issue a decision.
Day and others said the number was something different: the maximum amount of time they should spend on a case. Insurers often require approval in advance for expensive procedures or medicines, a process known as prior authorization. The early 2022 dashboards listed a handle time of four minutes for a prior authorization. The bulk of drug requests were to be decided in two to five minutes. Hospital discharge decisions were supposed to take four and a half minutes.
"Medical directors would message me and say, 'We can't do these cases in four minutes. Not if you want to do a good job,'" Day recalled.
As ProPublica and The Capitol Forum reported last year, Cigna built a computer program that allowed its medical directors to deny certain claims in bulk. The insurer's doctors spent an average of just 1.2 seconds on each of those cases. Cigna at the time said the review system was created to speed up approval of claims for certain routine screenings; the company later posted a rebuttal to the story. A congressional committee and the Department of Labor launched inquiries into this Cigna program. A spokesperson for Rep. Cathy McMorris Rodgers, the chair of the congressional committee, said Rodgers continues to monitor the situation after Cigna shared some details about its process. The Labor Department is still examining such practices.
One figure on Cigna's January and February 2022 dashboards was like a productivity score; the news organizations found that this number reflects the pace at which a medical director clears cases.
Cigna said it was incorrect to call that figure on its dashboard a productivity score and said its "view on productivity is defined by a range of factors beyond elements included in a single spreadsheet." In addition, the company told the news organizations, "The copy of the dashboard that you have is inaccurate and secondary calculations made using its contents may also be inaccurate." The news organizations asked what was inaccurate, but the company wouldn't elaborate.
Nevertheless, Cigna said that because the dashboard created "inadvertent confusion" the company was "reassessing its use."
Day was afraid to look at the dashboards. Anyone could see that by Cigna's measures, she was a laggard. In January 2022, only a third of her peers had lower scores, and in February 2022, it was just a quarter.
In a recorded phone call and in emails with supervisors, Day complained that Cigna's metrics failed to account for the quality of decisions. She said she and others asked higher-ups how often medical director decisions were overturned on appeal but nobody would say.
Day gave Cigna written permission to discuss her employment with ProPublica and The Capitol Forum.
The company described Day as a "disgruntled former employee" and said her "personal view is not an accurate representation of the work of the many medical directors and clinicians we employ." Cigna added that prior authorization requests are often time-sensitive and the company's "mission is to ensure our patients receive the right care as quickly as possible."
Cigna rejected the assertions that denying cases was an effective way of working faster. "Even if medical directors were incentivized to review more claims — which they are not — it makes no sense to suggest that this incentivizes denials; it would be far quicker to approve all claims," the company spokesperson wrote. The insurer said that denials take more time because they require a deeper review of clinical data, potentially requesting additional reviews by senior clinical directors, drafting denial letters and possibly phoning the treating physicians.
But another doctor who had worked at Cigna also said that denying a request for payment was far quicker than approving one since the nurses served up language that could be used to justify the denial. That former Cigna medical director said, "Sometimes you just have to accept the nurse and click and close if you had too much work." (That doctor asked not to be named because they feared repercussions if they commented publicly.)
When Debby Day got her job at Cigna in November 2005, she thought it was a godsend.
She had been working for a health insurance startup in North Carolina. The charismatic founder of the company, Day said, had told her and a handful of principal executives to expect a windfall when the company went public. That never happened, and Day was eventually left with no job and no severance.
When a recruiter mentioned the medical director job at Cigna, it sounded like a perfect fit. The job was based in North Carolina, but Cigna didn't mind that she was licensed in California, where she did her residency at Harbor-UCLA Medical Center. She was ready to leave the executive track, and the position allowed her to put her medical training to good use without the daily grind of working in a clinic.
The daughter of an ophthalmologist, Day had watched her father perform eye surgery when she was a child, and she found medicine fascinating. When Day started practicing, she learned quickly that while she enjoyed the intellectual challenges of medicine, the hands-on work of seeing patients drained her. As a medical director, she said, "I could really take care of patients without having to talk to them all day long."
Cigna, like all health insurers, makes patients get approval in advance for certain treatments. Day became one of the people who reviewed these prior authorization requests, deciding what to cover and what to deny. Everyone Day worked with was under one roof in Raleigh, North Carolina. The office buzzed with conversations among colleagues, and she was able to consult with specialists on complex cases.
She never felt pressure to do anything but make the right decision for the patient. At the same time, she said, she didn't hesitate to reject treatment she thought was improper.
Day describes herself as persnickety but feels that the time she spent reviewing case files was essential to reaching the right decision. Credit:Andrea Bruce for ProPublica
A couple years into her time at Cigna, Day noticed some doctors prescribing a costly treatment called intravenous immunoglobulin, or IVIG, that helps patients with weakened immune systems fight off infections. Only she found they were prescribing it in cases where it didn't make any medical sense. That wasn't good for patients or for Cigna. "Some of these guys were pouring it into every patient they could get their hands on and then making hundreds of thousands of dollars billing for it," she recalled.
At the time, Cigna didn't have a policy for when IVIG should be used, so Day developed one based on the scientific evidence available at the time. Day said this saved millions of dollars and that Cigna rewarded her with bonuses and stock options.
"In my head I truly believed that you could marry good health care with business," she said.
As Day neared the end of her first decade at Cigna, the company closed regional offices in favor of a nationwide review system, she said. With medical directors working from home, Day could no longer pop down the hallway to consult with doctors in other specialities.
Cigna had used a productivity dashboard for years, but by 2019, these metrics began playing a more prominent role in the company's evaluations of medical directors, Day said. Now, making a fast decision seemed more important than making the right decision, she said. In February 2019 emails to her managers, Day openly questioned this system.
Her boss responded: "We all understand that many cases are involved and take more time," he wrote. "We have tried to account for that additional time in the allotment allowed for certain cases."
Still, he made it clear that transaction volume — the metric on the dashboard that was similar to a productivity score — was one of the factors "we use to determine merit raises, bonus" and stock awards. When asked about this, Cigna said that "any assertion that our Medical Directors' compensation (cash or stock) is tied to denials or their handle time for cases is false."
In that same 2019 email, Day's boss added, "We want to assist every medical director who wishes to improve his or her efficiency."
Day shot back, "Some of our newer MDs are quite terrified of the 'counting,'" she wrote. "All ask — 'how is quality measured?'"
Soon, Day realized that her boss wasn't talking in the abstract about improving efficiency; he was talking about her. She learned that managers were going to help her pick up the pace of her reviews.
When bosses reached out, they didn't discuss whether she was making the right call, only how long it took her to decide, she said.
By then, Day said, Cigna had shifted much of the nursing work to the Philippines. She found mistakes in the case files that these nurses sent. In an email to Day, a fellow medical director lamented the amount of time it took to untangle one case and said the reports by "the overseas nurses" were "messes."
Some of the more astonishing problems that Day spotted have stayed with her. In a case involving a newborn who needed an epilepsy evaluation, Day noticed that a Cigna nurse had listed the mother's name as the patient, rather than the baby's. Day fixed that mistake, avoiding what certainly would have been a denial. In another case, a nurse recommended denying payment for an ultrasound of the neck because the treatment wasn't medically necessary. But the nurse had gotten the body part wrong. It was a hip that was injured, and the imaging was needed. An appeal that landed on Day's desk involved Cigna's decision to reject payment for a test because it wasn't medically necessary for a patient with a sexually transmitted disease. But Day figured out that the patient had toenail fungus, not an STD.
Day said her bosses didn't want to hear that she was catching errors. By October 2020, Cigna had placed Day on a performance improvement plan that required her to raise her "productivity level" — referring to the score on the dashboard — to at least 70%, which would be a significant jump for her but was slightly below the median for medical directors. The company made the consequences crystal clear: If she failed to successfully complete the plan, she could be terminated.
ProPublica and The Capitol Forum asked Cigna how it calculated that score, but the company wouldn't say. "Transaction volume helps gauge productivity and efficiency — the amount of work done, not the speed at which it is done," a Cigna spokesperson wrote. The company said this metric measured the time a medical director spent on tasks involving medical judgment versus other work, such as internal meetings or training.
On the early 2022 productivity dashboard, though, a different calculation could explain Day's score, and this math reflects how fast medical directors reviewed cases. ProPublica and The Capitol Forum multiplied the number of cases Day handled by the time Cigna allotted for each type of case, then divided that total by the hours she worked that month. The resulting percentage equaled her score. Medical directors who spent every available minute of their workdays clearing cases within the time constraints Cigna set would score at least 100%. Indeed, some medical directors had scores greater than 100%, meaning they cleared cases in even less than the allotted time. The newsrooms' formula accurately reproduced the scores of 87% of the Cigna doctors listed; the scores of all but one of the rest fell within 1 to 2 percentage points of the number generated by this formula. When asked about this formula, Cigna said it may be inaccurate but didn't elaborate.
Day said her bosses told her that the way to boost her score was to review more cases during her normal work hours.
Responding to questions, Cigna said the productivity dashboard was "primarily used to ensure that we have enough medical directors to perform the amount and type of work that needs to be done." It is not used, the company said, to evaluate the performance of medical directors or track the speed at which individual doctors do their work.
Cigna, however, later said of the dashboard that "in the unusual situation that a medical director is a significant outlier to peers performing similar types of reviews, managers might use this metric as one data point to understand and discuss the variance with the medical director." It also said Day was placed on a performance improvement plan "to help her meet the most basic standards to support patient care."
During the time Day spent on the performance improvement plan, she refused to change her approach, which she felt was necessary to make the right call.
In December 2020, she appealed to the human resources department, figuring that colleagues there would see that it was wrong to fire a medical director for taking care to decide critical medical questions.
She was wrong.
"You feel that the time constraints/metrics, which are in place to review these cases are unreasonable, for some cases are very complex consisting of multiple pages to review," a Cigna human resources employee wrote, summing up Day's feelings as the matter escalated.
And while Day's supervisor "appreciates your attention to detail," the human resources employee wrote, he "also realizes that there are metrics in place that he must hold everyone to."
When asked about this, Cigna said, "Dr. Day raised questions about her performance improvement plan through appropriate internal ethics channels available to all employees, and there was no wrongdoing found."
Eventually, the daily stress of being pushed to work faster coupled with the threat of being fired took a toll on Day. Sleepless and fighting depression, Day was at the breaking point.
"I actually sort of had a mental breakdown," she recalled.
On a recorded call with her boss about her lagging productivity score, Day brought the subject back to the quality of the decisions she was making. Her boss made it sound like Day was a broken record.
"We have the same discussion every time we talk," he said. While saying "nobody's asking you not to do quality work," her boss said, "you must know I just have to redirect our discussion."
But Day continued: "When there is no measurement of quality, then the discussion will continue to have that element to it."
The supervisor said he heard Day's concerns "loud and clear" but warned that "at the end of the day, we need to get your productivity up and we don't have a lot of time to do that."
The focus on metrics was proof Cigna was losing its way, Day told her boss. When she started working at Cigna 15 years earlier, there was a "commitment to quality and taking care of our customers." Day said that it was still important to her and other medical directors that "we go home at the end of the day and think we've done a good job for Cigna."
How Cigna Saves Millions by Having Its Doctors Reject Claims Without Reading Them
In a response to questions, Cigna said the supervisor, who works in California, was unaware that he was being recorded and that under that state's laws, it is illegal to record a private phone call without all parties' consent. Day said that she was in North Carolina during the call and that North Carolina law allows a person on a call to record without getting the consent of others.
Day took a monthslong leave from the job in mid-2021 that allowed her to work part time, and she found a therapist who helped her manage the depression. When she returned, Day said, it was more of the same.
In the late spring of 2022 she decided to retire from Cigna.
In a written response to questions, Cigna said its medical directors are not allowed to "rubber stamp" a nurse's recommendation for denial. In all cases, the company wrote, it expects its doctors to "perform thorough, objective, independent and accurate reviews in accordance with our coverage policies." The company said it was unaware of the use of the term "click and close" and that "such behavior would not be tolerated."
During Day's final years at Cigna, the company meticulously tracked the output of its medical directors on a monthly dashboard. Cigna shared this spreadsheet with more than 70 of its doctors, allowing them to compare their tally of cases with those of their peers. Day and two other former medical directors said the dashboard sent a message loud and clear: Cigna valued speed. (ProPublica and The Capitol Forum found these other former Cigna doctors independently; Day did not refer them.) One of Day's managers in a written performance evaluation called the spreadsheet the "productivity dashboard."
Measuring the speed and output of employees is common in many industries, from fast food to package delivery, but the use of these kinds of metrics in health care is controversial because the stakes are so high. It's one thing if a rushed server forgets the fries with your burger. It's another entirely if the pressure to act fast leads to wrongful denials of payment for vital care. Walgreens in 2022 dropped measurements of its pharmacists' speed from their performance reviews after some alleged that practice could lead to dangerous mistakes.
ProPublica and The Capitol Forum examined Cigna's productivity dashboards for medical directors from January and February 2022. These spreadsheets tallied the number of cases each medical director handled. Cigna gave each task a "handle time," which the company said was the average amount of time it took its medical directors to issue a decision.
Day and others said the number was something different: the maximum amount of time they should spend on a case. Insurers often require approval in advance for expensive procedures or medicines, a process known as prior authorization. The early 2022 dashboards listed a handle time of four minutes for a prior authorization. The bulk of drug requests were to be decided in two to five minutes. Hospital discharge decisions were supposed to take four and a half minutes.
As ProPublica and The Capitol Forum reported last year, Cigna built a computer program that allowed its medical directors to deny certain claims in bulk. The insurer's doctors spent an average of just 1.2 seconds on each of those cases. Cigna at the time said the review system was created to speed up approval of claims for certain routine screenings; the company later posted a rebuttal to the story. A congressional committee and the Department of Labor launched inquiries into this Cigna program. A spokesperson for Rep. Cathy McMorris Rodgers, the chair of the congressional committee, said Rodgers continues to monitor the situation after Cigna shared some details about its process. The Labor Department is still examining such practices.
One figure on Cigna's January and February 2022 dashboards was like a productivity score; the news organizations found that this number reflects the pace at which a medical director clears cases.
Cigna said it was incorrect to call that figure on its dashboard a productivity score and said its "view on productivity is defined by a range of factors beyond elements included in a single spreadsheet." In addition, the company told the news organizations, "The copy of the dashboard that you have is inaccurate and secondary calculations made using its contents may also be inaccurate." The news organizations asked what was inaccurate, but the company wouldn't elaborate.
Nevertheless, Cigna said that because the dashboard created "inadvertent confusion" the company was "reassessing its use."
Day was afraid to look at the dashboards. Anyone could see that by Cigna's measures, she was a laggard. In January 2022, only a third of her peers had lower scores, and in February 2022, it was just a quarter.
In a recorded phone call and in emails with supervisors, Day complained that Cigna's metrics failed to account for the quality of decisions. She said she and others asked higher-ups how often medical director decisions were overturned on appeal but nobody would say.
Day gave Cigna written permission to discuss her employment with ProPublica and The Capitol Forum.
The company described Day as a "disgruntled former employee" and said her "personal view is not an accurate representation of the work of the many medical directors and clinicians we employ." Cigna added that prior authorization requests are often time-sensitive and the company's "mission is to ensure our patients receive the right care as quickly as possible."
Cigna rejected the assertions that denying cases was an effective way of working faster. "Even if medical directors were incentivized to review more claims — which they are not — it makes no sense to suggest that this incentivizes denials; it would be far quicker to approve all claims," the company spokesperson wrote. The insurer said that denials take more time because they require a deeper review of clinical data, potentially requesting additional reviews by senior clinical directors, drafting denial letters and possibly phoning the treating physicians.
But another doctor who had worked at Cigna also said that denying a request for payment was far quicker than approving one since the nurses served up language that could be used to justify the denial. That former Cigna medical director said, "Sometimes you just have to accept the nurse and click and close if you had too much work." (That doctor asked not to be named because they feared repercussions if they commented publicly.)
When Debby Day got her job at Cigna in November 2005, she thought it was a godsend.
She had been working for a health insurance startup in North Carolina. The charismatic founder of the company, Day said, had told her and a handful of principal executives to expect a windfall when the company went public. That never happened, and Day was eventually left with no job and no severance.
When a recruiter mentioned the medical director job at Cigna, it sounded like a perfect fit. The job was based in North Carolina, but Cigna didn't mind that she was licensed in California, where she did her residency at Harbor-UCLA Medical Center. She was ready to leave the executive track, and the position allowed her to put her medical training to good use without the daily grind of working in a clinic.
The daughter of an ophthalmologist, Day had watched her father perform eye surgery when she was a child, and she found medicine fascinating. When Day started practicing, she learned quickly that while she enjoyed the intellectual challenges of medicine, the hands-on work of seeing patients drained her. As a medical director, she said, "I could really take care of patients without having to talk to them all day long."
Cigna, like all health insurers, makes patients get approval in advance for certain treatments. Day became one of the people who reviewed these prior authorization requests, deciding what to cover and what to deny. Everyone Day worked with was under one roof in Raleigh, North Carolina. The office buzzed with conversations among colleagues, and she was able to consult with specialists on complex cases.
She never felt pressure to do anything but make the right decision for the patient. At the same time, she said, she didn't hesitate to reject treatment she thought was improper.
A couple years into her time at Cigna, Day noticed some doctors prescribing a costly treatment called intravenous immunoglobulin, or IVIG, that helps patients with weakened immune systems fight off infections. Only she found they were prescribing it in cases where it didn't make any medical sense. That wasn't good for patients or for Cigna. "Some of these guys were pouring it into every patient they could get their hands on and then making hundreds of thousands of dollars billing for it," she recalled.
At the time, Cigna didn't have a policy for when IVIG should be used, so Day developed one based on the scientific evidence available at the time. Day said this saved millions of dollars and that Cigna rewarded her with bonuses and stock options.
"In my head I truly believed that you could marry good health care with business," she said.
As Day neared the end of her first decade at Cigna, the company closed regional offices in favor of a nationwide review system, she said. With medical directors working from home, Day could no longer pop down the hallway to consult with doctors in other specialities.
Cigna had used a productivity dashboard for years, but by 2019, these metrics began playing a more prominent role in the company's evaluations of medical directors, Day said. Now, making a fast decision seemed more important than making the right decision, she said. In February 2019 emails to her managers, Day openly questioned this system.
Her boss responded: "We all understand that many cases are involved and take more time," he wrote. "We have tried to account for that additional time in the allotment allowed for certain cases."
Still, he made it clear that transaction volume — the metric on the dashboard that was similar to a productivity score — was one of the factors "we use to determine merit raises, bonus" and stock awards. When asked about this, Cigna said that "any assertion that our Medical Directors' compensation (cash or stock) is tied to denials or their handle time for cases is false."
In that same 2019 email, Day's boss added, "We want to assist every medical director who wishes to improve his or her efficiency."
Day shot back, "Some of our newer MDs are quite terrified of the 'counting,'" she wrote. "All ask — 'how is quality measured?'"
Soon, Day realized that her boss wasn't talking in the abstract about improving efficiency; he was talking about her. She learned that managers were going to help her pick up the pace of her reviews.
When bosses reached out, they didn't discuss whether she was making the right call, only how long it took her to decide, she said.
By then, Day said, Cigna had shifted much of the nursing work to the Philippines. She found mistakes in the case files that these nurses sent. In an email to Day, a fellow medical director lamented the amount of time it took to untangle one case and said the reports by "the overseas nurses" were "messes."
Some of the more astonishing problems that Day spotted have stayed with her. In a case involving a newborn who needed an epilepsy evaluation, Day noticed that a Cigna nurse had listed the mother's name as the patient, rather than the baby's. Day fixed that mistake, avoiding what certainly would have been a denial. In another case, a nurse recommended denying payment for an ultrasound of the neck because the treatment wasn't medically necessary. But the nurse had gotten the body part wrong. It was a hip that was injured, and the imaging was needed. An appeal that landed on Day's desk involved Cigna's decision to reject payment for a test because it wasn't medically necessary for a patient with a sexually transmitted disease. But Day figured out that the patient had toenail fungus, not an STD.
Day said her bosses didn't want to hear that she was catching errors. By October 2020, Cigna had placed Day on a performance improvement plan that required her to raise her "productivity level" — referring to the score on the dashboard — to at least 70%, which would be a significant jump for her but was slightly below the median for medical directors. The company made the consequences crystal clear: If she failed to successfully complete the plan, she could be terminated.
ProPublica and The Capitol Forum asked Cigna how it calculated that score, but the company wouldn't say. "Transaction volume helps gauge productivity and efficiency — the amount of work done, not the speed at which it is done," a Cigna spokesperson wrote. The company said this metric measured the time a medical director spent on tasks involving medical judgment versus other work, such as internal meetings or training.
On the early 2022 productivity dashboard, though, a different calculation could explain Day's score, and this math reflects how fast medical directors reviewed cases. ProPublica and The Capitol Forum multiplied the number of cases Day handled by the time Cigna allotted for each type of case, then divided that total by the hours she worked that month. The resulting percentage equaled her score. Medical directors who spent every available minute of their workdays clearing cases within the time constraints Cigna set would score at least 100%. Indeed, some medical directors had scores greater than 100%, meaning they cleared cases in even less than the allotted time. The newsrooms' formula accurately reproduced the scores of 87% of the Cigna doctors listed; the scores of all but one of the rest fell within 1 to 2 percentage points of the number generated by this formula. When asked about this formula, Cigna said it may be inaccurate but didn't elaborate.
Day said her bosses told her that the way to boost her score was to review more cases during her normal work hours.
Responding to questions, Cigna said the productivity dashboard was "primarily used to ensure that we have enough medical directors to perform the amount and type of work that needs to be done." It is not used, the company said, to evaluate the performance of medical directors or track the speed at which individual doctors do their work.
Cigna, however, later said of the dashboard that "in the unusual situation that a medical director is a significant outlier to peers performing similar types of reviews, managers might use this metric as one data point to understand and discuss the variance with the medical director." It also said Day was placed on a performance improvement plan "to help her meet the most basic standards to support patient care."
During the time Day spent on the performance improvement plan, she refused to change her approach, which she felt was necessary to make the right call.
In December 2020, she appealed to the human resources department, figuring that colleagues there would see that it was wrong to fire a medical director for taking care to decide critical medical questions.
She was wrong.
"You feel that the time constraints/metrics, which are in place to review these cases are unreasonable, for some cases are very complex consisting of multiple pages to review," a Cigna human resources employee wrote, summing up Day's feelings as the matter escalated.
And while Day's supervisor "appreciates your attention to detail," the human resources employee wrote, he "also realizes that there are metrics in place that he must hold everyone to."
When asked about this, Cigna said, "Dr. Day raised questions about her performance improvement plan through appropriate internal ethics channels available to all employees, and there was no wrongdoing found."
Eventually, the daily stress of being pushed to work faster coupled with the threat of being fired took a toll on Day. Sleepless and fighting depression, Day was at the breaking point.
"I actually sort of had a mental breakdown," she recalled.
On a recorded call with her boss about her lagging productivity score, Day brought the subject back to the quality of the decisions she was making. Her boss made it sound like Day was a broken record.
"We have the same discussion every time we talk," he said. While saying "nobody's asking you not to do quality work," her boss said, "you must know I just have to redirect our discussion."
But Day continued: "When there is no measurement of quality, then the discussion will continue to have that element to it."
The supervisor said he heard Day's concerns "loud and clear" but warned that "at the end of the day, we need to get your productivity up and we don't have a lot of time to do that."
The focus on metrics was proof Cigna was losing its way, Day told her boss. When she started working at Cigna 15 years earlier, there was a "commitment to quality and taking care of our customers." Day said that it was still important to her and other medical directors that "we go home at the end of the day and think we've done a good job for Cigna."
In a response to questions, Cigna said the supervisor, who works in California, was unaware that he was being recorded and that under that state's laws, it is illegal to record a private phone call without all parties' consent. Day said that she was in North Carolina during the call and that North Carolina law allows a person on a call to record without getting the consent of others.
Day took a monthslong leave from the job in mid-2021 that allowed her to work part time, and she found a therapist who helped her manage the depression. When she returned, Day said, it was more of the same.
In the late spring of 2022 she decided to retire from Cigna.
In January, the Biden administration pledged to increase public access to a wide array of Medicare information to improve health care for America's most sick and vulnerable.
Some Medicare plans' lack of transparency "deprives researchers and doctors of critical data to evaluate problems and trends in patient care," said Xavier Becerra, the secretary of health and human services, in a statement.
So researchers across the country were flummoxed this week when the Centers for Medicare and Medicaid Services announced a proposal that will increase fees and diminish access to claims data that has informed thousands of health care studies and influenced major public health reforms.
More than 300 academics — a who's who of health economics researchers — have already signed a draft letter decrying the "catastrophic impact" the new proposal would have on health care research. Nearly half of all Americans are covered by Medicare, Medicaid and the Children's Health Insurance Program. Medicare and Medicaid claims contain detailed information about payments for medical care, including diagnoses, treatments and patient demographics.
The CMS data "is a national resource," said Anirban Basu, a professor of health economics at the University of Washington. "It's used for research that helps to develop public policy, that helps in health equality, that plays a role in legislation. Most importantly, such research translates to better health and access for the 160 million CMS beneficiaries."
CMS explained that the changes were aimed at better protecting people's health care records, citing "an increase in data breaches across the healthcare ecosystem." In its announcement, the agency did not cite any examples of unauthorized releases of information involving research organizations or universities. However, last year, hackers stole the personal medical information of more than 600,000 Medicare beneficiaries from a CMS contractor.
"Expanding user-friendly, secure access to CMS data continues to be a priority for the agency," said Jonathan Blum, the principal deputy administrator and chief operating officer of CMS, in a statement. He added that the agency "will carefully consider how to best meet stakeholders' data needs while protecting beneficiary data."
Under the current system, academics are able to request claims data for a one-time fee of as little as $20,000 — a price that can increase depending on the amount of information requested. The data is stored on university computers that meet data protection requirements and that allow access to multiple users for a small additional charge.
Researchers have used such data to conduct studies that influenced numerous public health care initiatives, including the development and evaluation of the Obamacare program. Just last month, Basu published a paper, using information from the CMS programs, that analyzed the cost-effectiveness of gene therapy treatment for sickle cell disease, a blood disorder that primarily affects people of African descent.
Researchers have also used the data to discover potential abuse and fraud in Medicare and Medicaid — the two programs together account for more than $1.7 trillion in government spending.
The new proposal, however, would force researchers to use a CMS-controlled computer platform to analyze data, instead of distributing it directly to universities and other institutions. Costs would start at an estimated $35,000 and would allow access to only one researcher and require annual renewal fees. Blum noted that researchers, however, would no longer have to bear the costs of storing and securing the data.
Research teams on complex projects can include dozens of people and take years to complete. "The costs will grow exponentially and make access infeasible except for the very best resourced organizations," said Joshua Gottlieb, a professor at the University of Chicago's Harris School of Public Policy. He has used the data to show that when Medicare increases its fees, private insurance companies follow by hiking their own.
One of the major concerns is that higher prices will shut down research by Ph.D. students and junior faculty, whose budgets typically wouldn't cover a single user fee. "Some important research would be reduced" if the proposal is implemented, Basu said.
Some researchers are also concerned about having to use a government-controlled system to conduct research that may be critical of CMS. Medicare Advantage — a program that allows private insurance companies to pay for health care services for the elderly — has come under increasing scrutiny for rising costs.
Another unanswered question is how the CMS computer platform would accommodate additional requests from the thousands of researchers who now use data stored on their own computers. Academics often perform complex statistical analyses on data that require extensive computer time to process.
"It seems crazy to me that given the value of human life and what we spend on healthcare as a country, that the administration would take a step to make research harder not easier," said Zack Cooper, a professor of public health and economics at Yale.
Do You Have Insights Into Dental and Health Insurance Denials? Help Us Report on the System.
Insurers deny tens of millions of claims every year. ProPublica is investigating why claims are denied, what the consequences are for patients and how the appeal process really works.
As Philips reassured patients that millions of recalled machines were safe, internal emails show federal regulators privately told the company its testing didn't account for the impact of long-term harm from tainted devices.
This article was published on Friday, February 9, 2024 in ProPublica.
Philips Respironics received thousands of complaints about a dangerous defect in its breathing machines but kept them secret for years as stock prices soared. The devices, including the popular DreamStation for sleep apnea, went to children, the elderly and veterans before the global giant announced a massive recall.
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In the winter of 2021, with its stock price plunging, lawsuits mounting and popular breathing machines pulled from the shelves, Philips Respironics made a surprise public announcement.
The company said the sleep apnea devices it had recalled only months earlier had undergone new safety tests and did not appear to pose a health threat to the millions of patients who relied on them to breathe.
It was a remarkable reversal for the global manufacturer, which had drawn headlines after admitting that an industrial foam placed inside the devices could break apart in heat and humidity and send potentially toxic and carcinogenic particles and fumes into the masks worn by users.
The new results, Philips said, found the machines were not expected to "result in long-term health consequences."
But a series of emails obtained by ProPublica and the Pittsburgh Post-Gazette show the Food and Drug Administration quickly rejected those safety claims, telling Philips that the new tests failed to account for the impact on patients who had used the devices for years. The FDA also said it still considered the machines a significant health threat that could inflict severe injury or even death.
"These tests are preliminary," the agency told Philips. "Definitive conclusions cannot yet be drawn in support of reduction in hazards."
The FDA did not publicize its assessment, even though patients across the country were at risk and an untold number continued using their recalled machines while they waited on Philips to send replacements.
At the time, the FDA made only one public reference to the dispute — on the fourth page of a 14-page letter to Philips in May 2022. To see it, customers would have had to find it on the agency's website and then wade through scientific language about "cytotoxicity failure," "novel continuous sampling" and other complex concepts.
Philips went on to publicize more test results, all playing down the potential health dangers. To this day, the FDA has said little about its ongoing disagreement with the company over whether the machines were safe.
The emails over the course of 2022 were obtained by ProPublica and the Post-Gazette through a public records lawsuit filed by the news organizations against the FDA. Taken together, the exchanges reveal a startling lack of transparency by both Philips and the government while patients and their doctors struggled to make sense of one of the largest and most tumultuous medical device recalls in years.
"The bottom line is that lives were at risk," said Dr. Bob Lowe, a former emergency room physician and public health advocate in Oregon who used one of the recalled machines. "People have a right to know and providers have a right, or really an obligation, to be fully informed. As a physician, if I don't know what the dangers are, then I can't protect my patients."
In the emails to Philips, the FDA described a litany of concerns, notably that the company's analysis did not consider the "real world" use of the devices, which send air directly into the noses, mouths and lungs of patients for hours at a time.
Philips had brought on independent testing labs to assess whether the chemicals and particles released into the masks of patients reached dangerous levels, but the government in its emails said the testing program was "limited in its utility and does not fully assess or account for all risks."
"FDA has not accepted the data or Philips Respironics' conclusions," Denise Hampton, with the FDA's Office of Health Technology, wrote to the company in one of the emails.
It wasn't until October 2023 — nearly two years after Philips started promoting the favorable test results — that the FDA released a public statement about its concerns, saying that testing and analysis were not "adequate" and that Philips had agreed to conduct additional studies.
Richard Callender, a former mayor in Pennsylvania who used his sleep apnea machine for six months after the recall, said patients should have been given details far earlier.
"We deserve that. If they had concerns they should have at least informed the public," he said. "Don't let everybody walk around saying, ‘Hey, I'm OK because [Philips] told me they think it's all right.'"
The FDA defended its handling of the matter, saying it released the statement in October after completing an analysis of the company's test results. "Any health determination made by the FDA is science-driven and based on thorough analysis of the information presented to the agency," it said.
The agency said it "has been clear" about the government's concerns with the foam in public alerts and other communications and has maintained its position about the potential health risks.
Lowe, however, said the FDA waited far too long to publicly challenge Philips as the company repeatedly told patients that the devices were safe.
"It's not full disclosure," he said.
Philips did not respond to specific questions from ProPublica and the Post-Gazette, but it has previously said that the tests found the foam caused no "appreciable harm" to patients and that the company would continue to carry out additional tests.
In its emails to the FDA, Philips said that the favorable findings were based on the "worst-case chemical release" and that testing had found particles from the foam did not exceed safety levels.
While Philips continues to defend the safety of the devices, the company late last month announced it would not sell any new sleep apnea machines and other respiratory devices in the United States under an agreement with the federal government.
Days later, the FDA said it had received 561 reports of deaths associated with the machines since 2021.
From the outset of the recall, there was little debate that Philips had a serious problem: Noise-reducing foam that the company had fitted inside the devices years earlier was crumbling.
Both Philips and the FDA at the time described potential health risks for patients exposed to the material, including respiratory tract illnesses, headaches, nausea, and toxic and carcinogenic effects.
Philips, however, began to walk back its warnings in December 2021, six months after the recall began. And by the following year, the company made multiple announcements about the new test results.
In email exchanges, the FDA challenged the "significant limitations" of the company's testing program as well as efforts to change an earlier evaluation of the health risks conducted by about a dozen company officials. The 2021 internal assessment was damning, describing the deteriorating foam and dangerous chemicals and declaring the risk to patients who used the machines "unacceptable."
Months later, Philips turned in a modified evaluation to the FDA, lowering the threat level from "crucial" to "marginal."
Inside Philips, scientists and others were also alarmed, criticizing the company for minimizing the health risks without carrying out comprehensive testing to determine whether the machines could inflict serious harm, according to interviews and internal communications obtained by ProPublica and the Post-Gazette.
The dispute reached the company's highest levels. Medical director Hisham Elzayat broke ranks and refused to sign the evaluation that downgraded the risk level, according to court testimony and the internal communications.
"I haven't seen or heard anything that makes me decide acceptable risk," he wrote at the time.
In another message, he noted about the evaluation, "There is nothing I can do about it."
He also wrote, "If only all this effort is steered towards fixing the problem instead of hiding it."
Elzayat, a cardiothoracic surgeon who still works for Philips and whose differences with the company were described in a federal court hearing in October, declined to comment.
According to the court testimony, after Elzayat refused to endorse the new evaluation, he was removed from the team inside Philips that was handling the crisis and stripped of his access to data about the foam.
Another company supervisor also raised concerns, complaining about the company's push to change the evaluation, internal communications show.
"They desperately want to make changes," the supervisor wrote. "I am trying to limit what they are doing."
ProPublica and the Post-Gazette are withholding the supervisor's name because of fear of reprisals.
Another official at Philips cited similar concerns, writing about the actions by a company manager to ensure that a testing lab reported favorable results. "You wouldn't believe the magic he worked to ensure that compound was labeled a non-risk," the official wrote.
The debate was captured in internal communications, some of which have been turned over to the Department of Justice. The DOJ has been carrying out a criminal investigation, according to sources familiar with the probe and a document reviewed by the news organizations.
Philips, which has said it is cooperating with authorities, declined to answer questions about Elzayat's role in the controversial evaluation of the foam.
ProPublica and the Post-Gazette have reported that the company held back more than 3,700 complaints about the foam degradation from customers and the government before announcing the recall. The news organizations recently obtained more records from the FDA that identified an additional 1,100 complaints that Philips did not turn over to the government before the recall.
Federal law requires medical device makers to submit reports about malfunctions, patient injuries and deaths to the FDA within 30 days. Philips has said the company reviewed the complaints on a case-by-case basis and gave them to the FDA after the recall out of an "abundance of caution."
The private debate about whether the machines were safe played out as hundreds of thousands of people were left to decide whether to continue using their recalled devices while waiting for a replacement from Philips. Many reached out to members of Congress, who forwarded a series of complaints to the FDA, records show.
"Having to choose whether to continue using a life-saving device and risk further health complications or to stop using them altogether and risk death is an unthinkable decision to make," Rep. Brian Fitzpatrick, R-Pa., wrote to the agency in 2022. "It is imperative that patients and healthcare providers have the best guidance."
The back-and-forth between federal regulators and Philips also unfolded as longtime users of the devices and their relatives stepped forward to report illnesses, including throat, lung, esophageal and nasal cancers. Some described deaths of wives, husbands and other family members.
ProPublica and the Post-Gazette previously identified reports that described nearly 2,000 cases of cancer, 600 liver and kidney illnesses, and 17,000 respiratory ailments.
Medical experts interviewed by ProPublica and the Post-Gazette say that it may take years to determine the health consequences but that early findings are worrisome. The devices tested positive numerous times for genotoxicity, the ability of a chemical to cause cells to mutate, a process that can lead to cancer, company records show.
The biggest challenge, they said, is conducting more comprehensive testing, including an epidemiological analysis that tracks the health of people who used the machines over years.
"You would want more than lab tests to really confirm that these devices are safe," said Kushal Kadakia, a public health researcher at Harvard Medical School who has written about the recall. "You'd want data from patients over multiple years."
Mike Wereschagin of the Pittsburgh Post-Gazette contributed reporting.
The agency has rolled out sweeping changes to target end-of-life care providers that were billing for unneeded services, but some fraud hot spots continue to evade scrutiny.
This article was published on Thursday, January 25, 2024 in ProPublica.
The year 2023 was a banner one for hospice reform. Spurred by media reports, letters from Congress and pressure from lobbying groups, the Centers for Medicare and Medicaid Services increased oversight of end-of-life care. It retooled inspections to focus on quality of care. It made ownership data public for the first time. And, kicking off a plan to visit every hospice provider in the country, its staff made appearances at 7000 sites. Following the tour, the Medicare billing privileges for 46 nonoperational hospices were revoked.
In July, the agency also rolled out a special enforcement program to target hospices in Arizona, California, Nevada and Texas — states with alarming spikes in the number of providers. The increase in hospice numbers had raised concerns inside and outside the agency about fraudulent bills for unneeded services and market oversaturation. During its "period of enhanced oversight," the agency said, it would scrutinize the claims from new hospices in these states before paying them.
These reforms, however, have done little to slow the region's hospice boom. CMS data from last year shows that these four states continued to drive most of the growth of new Medicare-certified hospices in the country, with two-thirds of all certifications taking place there. The nation's leading trade groups for end-of-life care have repeatedly recommended that Medicare impose a moratorium on certifying new hospices in counties that have seen an explosion in questionable startups. This would prevent bad actors from draining Medicare funds, the groups contend, while regulators can investigate fraudulent networks. In response to questions about this recommendation, CMS told ProPublica in a written statement that "if state officials believe there is a hospice issue in their state, they can pursue a state-based hospice license moratorium under their state laws/regulations such as what was done in California."
California, however, offers an example of why this approach may not be working: Last year, the state temporarily banned new hospice licenses altogether after its auditors found evidence of "a large-scale, targeted effort to defraud Medicare," with providers charging for patients who did not need hospice care or, in some cases, did not exist. But without a federal moratorium on certifications, the large crop of licensees that were established in the past three years can continue to bill Medicare. "The Department of Public Health is doing a fantastic job of trying to clean it up here in California, but they can't clean it up fast enough if CMS keeps allowing new hospices to charge for patients," said Sheila Clark, the president of the California Hospice and Palliative Care Association, a trade group for providers.
Indeed, the agency's data shows that last year it continued to certify hospices located in buildings that have been flagged by auditors and journalists as potential fraud hot spots. In 2023, Medicare certified 15 more hospices at a two-story building in Los Angeles that is home to more than 100 hospices. It also certified three new hospices last year at a Phoenix address that purportedly houses dozens of providers, all of which have materialized in the past two years.
CMS said that without "evidence of sanctions" that would authorize it to deny certification, the agency cannot prevent these hospices from entering the program. In a recent blog post it added that "we take our role as stewards of the Medicare Trust Funds seriously, and we work to ensure that taxpayer dollars are spent on high-quality, necessary care for each beneficiary."
Hospice fraud doesn't just drain Medicare reserves. It also harms patients who are not actually dying, since enrollment cuts them off from curative care. Karen Joy Fletcher, communications director at California Senior Medicare Patrol, which runs a hotline for patients and families, said that hospice fraud continues to be a big problem in the state despite the moratorium.
A few weeks ago, for instance, the hotline received a call from Anna Duran, whose mother has been in a nursing home in Los Angeles County since 2010. Duran was surprised to discover that her mother was unable to get her pacemaker checked because she'd recently been enrolled in hospice by a doctor she'd never heard of. Duran, who holds power of attorney for her mother, determined that no one at the nursing home had enrolled her mother — or thought, for that matter, that she was about to die. She had dementia and high blood pressure, but she was still walking. Each time Duran called the number for the hospice business, no one picked up. An analyst from Medicare has now been assigned to untangle the case, but so long as Duran's mother is still on hospice, she no longer qualifies for her regular physical therapy appointments. Medicare, meanwhile, has paid the hospice more than $7,500. "Nobody knows how this happened," Duran said.
Ava Kofman is a reporter on ProPublica's national desk.
Doctors working for health insurers can rule on 10,000 or more requests for care a year. At least a dozen were hired by major insurance companies after being disciplined by state medical boards or making multiple or outsized malpractice payments.
This article was published on Friday, December 15, 2023 in ProPublica.
By Patrick Rucker, The Capitol Forum, and David Armstrong and Doris Burke, ProPublica.
When Shawn Murphy's wife died in 2009 after a botched gallbladder surgery, he presumed the doctor who performed the operation would be forced out of medicine for good.
Dr. Pachavit Kasemsap, a former Air Force surgeon, had cut Loretta Murphy's aorta during that common procedure, according to a database of malpractice payments kept by Florida insurance regulators. She never left the hospital and died just shy of her 40th birthday. Shawn Murphy was left to raise their two daughters, then 13 and 17, on his own.
During the weeks that Murphy prayed for his wife to recover and the months that he fought Kasemsap in circuit court in Brevard County, Florida, he didn't know that other families had complained that their loved ones had suffered under the same doctor's care.
Kasemsap has settled five malpractice cases for a total of $3 million, according to the Florida malpractice payment database. That includes $1 million paid to the Murphy family. In one of the cases Kasemsap settled, a patient said the doctor negligently stapled and stitched her rectum to her vagina. Kasemsap denied doing that, and in legal filings in all five cases, the doctor denied that he was negligent.
The doctor's LinkedIn profile says his last job as a surgeon ended in December 2012, months before he settled the last of those five cases. But there was one industry ready to welcome him regardless: health insurance.
Kasemsap got a job as an insurance company medical director, where suddenly he had the power to impact the lives of far more patients than he would ever have seen in the operating room.
For most policyholders, the inner workings of their health insurer are a black box: Requests to cover treatment or pay claims go in, and approvals or rejections are spit out.
The pivotal gatekeepers inside the box are medical directors like Kasemsap. They can, without ever seeing a patient, overrule the judgment of the doctor who did and deny payment for a recommended procedure, test or medicine.
Insurers say medical directors steer patients away from unnecessary or risky care and expensive treatments for which there are less costly, equally effective alternatives. Patients and their physicians complain that insurance company doctors routinely, and wrongly, deny payment for critical lifesaving treatments because they are expensive.
The stakes are high: A refusal to pay for treatment can drive families into bankruptcy. Some patients, facing the cost, forgo care altogether. And a single medical director can rule on 10,000 cases a year, according to court testimony in a case involving Aetna. Some Cigna doctors have ruled on more than 10,000 cases in a month without opening the patient file, as ProPublica and The Capitol Forum have reported.
Despite the key role insurers' medical directors play in the lives of patients, their identities and backgrounds, and their qualifications for making such life-altering assessments, remain largely hidden.
Many states require medical directors to be licensed physicians, but beyond that it is generally up to insurers to determine which medical professionals are fit for the job.
Patients and the doctors who treat them don't get to pick which medical director reviews their case. An anesthesiologist working for an insurer can overrule a patient's oncologist. In other cases, the medical director might be a doctor like Kasemsap who has left clinical practice after multiple accusations of negligence.
As part of a yearlong series about how health plans refuse to pay for care, ProPublica and The Capitol Forum set out to examine who insurers picked for such important jobs.
Reporters could not find any comprehensive database of doctors working for insurance companies or any public listings by the insurers who employ them. Many health plans also farm out medical reviews to other companies that employ their own doctors. ProPublica and The Capitol Forum identified medical directors through regulatory filings, LinkedIn profiles, lawsuits and interviews with insurance industry insiders. Reporters then checked those names against malpractice databases, state licensing board actions and court filings in 17 states.
Among the findings: The Capitol Forum and ProPublica identified 12 insurance company doctors with either a history of multiple malpractice payments, a single payment in excess of $1 million or a disciplinary action by a state medical board.
One medical director settled malpractice cases with 11 patients, some of whom alleged he bungled their urology surgeries and left them incontinent. Another was reprimanded by a state medical board for behavior that it found to be deceptive and dishonest. A third settled a malpractice case for $1.8 million after failing to identify cancerous cells on a pathology slide, which delayed a diagnosis for a 27-year-old mother of two, who died less than a year after her cancer was finally discovered.
None of this would have been easily visible to patients seeking approvals for care or payment from insurers who relied on these medical directors.
When patients look for doctors, they can first check the physicians' education, experience and qualifications. Most states allow consumers to see if doctors have been sanctioned by a medical board for providing substandard care, and many also provide some information about malpractice payments. But that kind of up-front scrutiny isn't possible with medical directors because patients typically don't learn their identity until a denial arrives.
Kasemsap's history of malpractice payments was no secret before Cigna hired him in 2019. Two years earlier, he was the subject of a front-page story in the South Florida Sun Sentinel headlined "Dangerous Doctors." In addition to handling appeals for the insurer, Kasemsap obtained a certification through a Cigna physician leadership program and oversees the work of 13 other medical directors there, according to his LinkedIn profile. Cigna CEO David Cordani posed with him and others in a photo at a recent company leadership event.
When told Kasemsap was working in this critical role, Murphy was shocked. "This guy should not be deciding medical questions," he said. "I don't care if it's an earache."
Kasemsap wrote in an email to ProPublica and The Capitol Forum: "Please know that I carry every patient outcome with me, and those experiences reinforced my commitment to being a compassionate, detail-oriented, dedicated colleague who puts our members at the center of everything I do." Kasemsap said he was responding on his own behalf, not Cigna's. He did not answer other questions about his malpractice cases or his role at the insurer.
Cigna, in a statement, said all of its medical directors are board-certified, credentialed physicians and the company holds its medical directors to the same standard as doctors who participate in its network. "We use a comprehensive suite of materials and discussions to assess how our medical directors support patients efficiently and effectively," a company spokesperson wrote.
In another statement, the spokesperson wrote, "As I'm sure you're aware, malpractice claims against physicians are common, particularly in high-risk specialties such as surgery, and the settlement of malpractice claims does not necessarily mean that malpractice occurred."
"I can say in my 35-plus years doing this that this is the most unskilled surgeon I have ever seen in a case," said Mac McLeod, a malpractice attorney who represented two plaintiffs who sued Kasemsap, including the woman who said Kasemsap connected her rectum to her vagina.
When asked about McLeod's assertion, Kasemsap wrote, "This is a mischaracterization of a highly complex medical case that occurred more than 15 years ago." Kasemsap did not say what was mischaracterized.
A Doctor Goes Sleuthing
A few days before Christmas in 2021, Terrold Dance was loaded down with electrical tools when he slipped on some ice at a worksite and went to a Colorado hospital for help. An MRI later showed that Dance had torn his rotator cuff, the muscles and tendons that surround the shoulder joint and keep the upper arm bone in the socket.
Workers' compensation paid for the scan and some physical therapy, but that didn't fix the problem. By the next Christmas, Dance was still in pain and couldn't fully raise his arm over his head. A Colorado orthopedic surgeon, Dr. Braden Jones, examined Dance and concluded that he needed surgery.
"The guy had not gotten better for a year," Jones recalled. "It was a pretty clear-cut case for surgery."
Pinnacol Assurance, the workers' compensation company that handled Dance's policy, required that the surgery be authorized in advance, and the company hired a medical reviewer named Dr. Jon Erickson to scrutinize Dance's request and medical records. Like a medical director, a contract medical reviewer for Pinnacol evaluates whether a surgery is medically necessary. In a letter to a case manager, Erickson concluded that steroid injections and some physical therapy would likely be enough to fix Dance's problem. Pinnacol denied the request for surgery.
"I believe the mechanism of injury is somewhat questionable," Erickson wrote, "and we would be best served by considering a program of nonoperative care which involves injections."
The letter baffled Jones. It downplayed Dance's shoulder injury and brushed aside the MRI report, Jones said. Erickson didn't cite any published research or medical society guidelines to explain why an operation was not needed. Jones said that the letter was such a break from accepted orthopedic practice that he wondered if Erickson had ever been a surgeon.
So Jones decided to check. The Colorado medical board had a copy of Erickson's medical license and an explanation for why he hadn't set foot in an operating room in many years.
A disciplinary report from the medical board said Erickson had performed a "substandard" hip replacement surgery in 2013 that led to irreparable harm to a patient. Erickson tried in three additional operations to fix it, the disciplinary report said, but the patient had to undergo a fifth surgery elsewhere and will always walk with a limp.
That wasn't all. The report criticized Erickson for another faulty hip replacement six months after the first. The surgery had taken place on a Friday, and by Monday the same patient was back on the operating table with a broken hip. Erickson performed a second surgery but something was wrong. An X-ray showed the problem.
Erickson had put the hip in backwards.
In a 2017 settlement with the Colorado medical board, Erickson was allowed to keep his license as long as he never performed any kind of orthopedic surgery again. As a doctor reviewing cases for an insurer, though, Erickson has the power to decide that orthopedic operations are not medically necessary, when he himself is not allowed to perform them.
In an interview, Erickson defended his decision to deny Dance's surgery and his work overall. "This was a relatively clear-cut case," Erickson said. He added, "What we do at Pinnacol when we review these cases is prevent a lot of inappropriate care, and we save a lot of money for our clients."
In a statement, Pinnacol said Erickson was contracted as an independent reviewer and that he did not work directly for Pinnacol. "He is not and has never been an employee," a spokesperson wrote, adding that Pinnacol no longer uses Erickson to review cases. "Our mission as a not-for-profit, state-chartered carrier is to serve the workers and employers of Colorado, and we would never, nor do we support denying necessary medical care ‘to save our clients money.'"
The company said its claim denial rates are "roughly half the state average." While Pinnacol is a nonprofit insurer, it does typically return money to its customers in the form of an annual dividend.
For Jones, the experience confirmed all of his worst suspicions about medical directors.
"If you have ever seen a Lego, you know which way the hip goes," Jones said. "I always considered these medical directors to be sellouts, but I thought an insurance company would have more dignity than to hire someone like this."
After Jones complained to Pinnacol about Erickson's history and the wrongheaded nature of the denial, the insurer approved Dance's rotator cuff surgery, which he underwent earlier this year. Dance has since regained full strength and motion.
Jones was so disturbed by what he discovered that he complained to the medical board. Chief among Jones' beefs: If Erickson is not allowed to perform orthopedic surgery due to the board action, why is he allowed to rule on insurance cases that affect what orthopedic surgeons in good standing can do? The medical board acknowledged to Jones in a September letter that his complaint remained open but declined to comment to ProPublica and The Capitol Forum. Erickson said he thought Jones' decision to file a complaint with the medical board "was a little bit overkill."
Trouble With Medical Boards
Doctors turn to health insurance company work for many reasons. Some do it after burning out on clinical care or a change in circumstance, such as starting a family or retiring from a practice. Many find the work rewarding, saying they can help patients by flagging care that is unnecessary or even dangerous.
The job offers good pay with potential bonuses and a set schedule without weekend work or night shifts. The median pay for medical directors at insurers like UnitedHealthcare, Cigna and Elevance is around $300,000 a year, with the high end of the salary range over $400,000, according to the job site Glassdoor.
Despite this, ProPublica and The Capitol Forum found, insurance companies still wind up employing doctors who state medical regulators have rebuked for providing shoddy care or being dishonest.
A unit of Cigna called eviCore has employed Dr. Lorraine Driscoll as an associate medical director from 2006 through at least March 2022, according to records filed with the Maryland Insurance Administration. The New Jersey medical board in 2013 found grounds for disciplining Driscoll for "dishonesty, deception, and misrepresentation and/or … for engaging in professional misconduct."
The board reprimanded Driscoll, an obstetrician-gynecologist, for altering patient records in ways that could help her fight a 2004 malpractice case involving a child born with Down syndrome. That case, which wound up settling for $700,000, was one of six that Driscoll settled, according to her application to be certified as a medical director by the Maryland Insurance Administration. (Maryland officials approved her application.) She did not respond to calls, emails or a letter with detailed questions sent via FedEx.
Other insurers, including Aetna and UnitedHealthcare, hire eviCore to determine whether certain treatments are medically necessary.
When asked if Driscoll still works for eviCore, a company spokesperson declined to answer. In a written statement, eviCore said its medical directors are all board-certified physicians "who are dedicated to ensuring that patients receive safe, effective care guided by the latest clinical evidence." The company added that its doctors "are held to the same legal, licensing and education requirements that physicians treating patients are held to."
Aetna has on its in-house team Dr. Beth Ann Binkowski, an internal medicine physician who was censured and reprimanded by the New York state medical board in 2015 for failing to appropriately prescribe medications for five patients at Syracuse University with mental health conditions. Binkowski referred a reporter to Aetna for comment. A company spokesperson said all Aetna medical directors are licensed and board certified and that the company follows accreditation requirements and state and federal regulations.
UnitedHealthcare hired Dr. Dolores Rhymer-Anderson as a medical director in 2015 despite the fact that the Georgia medical board had previously reprimanded her for care related to the delivery of a baby born with severe neurological damage in 2000. She settled a related malpractice lawsuit for $2 million. In a legal filing in that malpractice case, Rhymer-Anderson denied that she was negligent and said she exercised the appropriate degree of care and skill ordinarily employed by doctors in the same circumstance.
A peer reviewer appointed by the medical board faulted Rhymer-Anderson for failing to conform to the minimum standard of acceptable and prevailing medical practice. As part of an agreement with the board in 2006, she was required to complete 20 hours of continuing medical education and pay a fine of $1,500. The board order stated Rhymer-Anderson did not acknowledge any impropriety and agreed not to contest the allegations to avoid protracted litigation.
Rhymer-Anderson excluded obstetrics from her practice before the board order, blaming the move on her experience with the lawsuit, according to a regulatory filing. She said she hoped to avoid another legal action.
But in 2008 she was sued again and settled the case for $1 million. That lawsuit faulted her work during a diagnostic procedure to evaluate a patient's uterus. The patient went into respiratory distress and suffered a brain injury from lack of oxygen. The patient spent a month in the hospital before being transferred to a long-term care facility. The lawsuit accused Rhymer-Anderson of incorrectly administering anesthesia, failing to properly supervise a nurse assisting and failing to secure an airway by endotracheal tube.
In her application to be certified as a medical director in Maryland, Rhymer-Anderson said she settled because the plaintiff was estimating the cost of future care at $16 million, which exceeded her malpractice insurance, and she was concerned a jury award could put her personal assets at risk. She said in the Maryland filing that three expert witnesses concluded that she met the standard of care in the case. In a court filing in that case, Rhymer-Anderson said she acted within the standard of care in treating the patient and did not commit any act of negligence that resulted in injuries. (Maryland officials approved her application.)
Settlements of $1 million or more, referred to as catastrophic claims, are rare. Only 7.6% of claims saw settlements that large in a study of malpractice cases filed nationwide from 1992 through 2014. The same study found the average malpractice payment by doctors in Rhymer-Anderson's specialty was $432,959.
Rhymer-Anderson did not respond to phone calls, emails and a letter with detailed questions sent via FedEx.
A UnitedHealth Group spokesperson said Rhymer-Anderson left the company last year. The spokesperson also wrote, "Medical directors go through a rigorous hiring process, to ensure they are qualified for the roles for which they are being considered." He added, "We review individual performances regularly and provide ongoing training to help them with their various responsibilities."
'Cranking Out Denials'
When an insurer shoots down a request to pay for care, the patient's doctor can call the insurance company's doctor to make the case for why it should be approved. This is known as a peer-to-peer review.
But doctors often complain they're not actually speaking with peers when they call an insurer. They get exasperated when an orthopedic surgeon weighs in on a procedure to treat an irregular heartbeat or a pediatrician questions an oncologist's plan for an adult with lung cancer.
In a survey conducted by the American Medical Association, only 2% of the doctors who responded said that health insurance medical directors were "always" appropriately qualified to assess the requested treatment. More than a third said health plan doctors were "rarely" or "never" qualified.
When Orrana Cunningham's doctor at the MD Anderson Cancer Center in Houston asked her insurer to approve the use of expensive proton beam therapy to attack her cancer, the decision on whether to pay for the care fell to an Aetna doctor who had not treated patients in more than 20 years, according to records from a lawsuit the Cunningham family brought against Aetna.
Dr. David Massman, a medical director at Aetna, denied coverage of the treatment, ruling that it was "experimental or investigational."
Cunningham's radiation oncologist, Dr. Clifton Fuller, then requested a peer-to-peer call so that he could explain why proton beam therapy was the best method for treating Cunningham's stage IV nasopharyngeal squamous carcinoma, a rare cancer located at the base of her skull. Proton beam therapy was needed, he said, because it could precisely deliver radiation to the cancer site while avoiding devastating side effects, such as loss of sight and memory, that could occur with other radiation treatments.
It was a complex procedure. Fuller wanted someone with a background in treating cancer to be on the call. Instead, he was paired with Massman, a family medicine physician who had never worked in radiation oncology and had never seen a proton beam machine.
Massman went to work for health insurers two decades ago after his Illinois medical license was placed on a four-year probation for issues related to a drug addiction, according to state licensing records. His license is in good standing now.
In their peer-to-peer call, Fuller testified in a sworn deposition, Massman acknowledged Fuller may be right that proton beam therapy was a safe treatment for Cunningham but said he "can't do anything about it" because the therapy did not comply with an Aetna clinical policy guideline.
Appeals of the decision failed. In all, three Aetna medical directors reviewed the treatment request and subsequent appeals. None of them were radiation oncologists.
As the appeals dragged on, Cunningham grew sicker. Out of options, her husband decided to mortgage the family home and sell other assets to pay for the $92,000 treatment.
Cunningham underwent the procedure in April 2015, four months after her doctors first asked Aetna to approve it. When she returned home in May, she started to behave strangely. She didn't recognize her husband or son. She was diagnosed with herpetic encephalitis, a disease that her family's attorney contended was unrelated to the cancer treatment and triggered by stress. She died later that month.
Cunningham's husband sued Aetna in Oklahoma state court, alleging that the insurer breached its contract with his wife, acted in bad faith and inflicted emotional distress.
At the trial, Massman testified that he could not recall details of his peer-to-peer call with Cunningham's radiation oncologist, but he said that he would never tell a treating physician that they were right about a treatment Aetna was denying.
In his closing arguments at the trial, Cunningham's lawyer, Doug Terry, condemned Aetna's medical directors: "These doctors were not properly qualified to know the first thing about the medical issues involved here. None of them had any experience with radiation oncology or proton therapy. They were cranking out denials as fast as they could."
Aetna's lawyer countered that the company was proud of the medical directors who denied Cunningham's care for "standing up for what is right." Massman and other Aetna medical directors involved in denying Cunningham's care sat in the front row as the company's lawyer made his closing argument, said Terry.
The jury in 2018 awarded Cunningham's estate and her husband $25.6 million. After Aetna appealed the jury verdict, the parties settled the case under confidential terms in 2021.
Massman did not respond to calls, emails and a letter with detailed questions sent via FedEx.
In a statement, Aetna said its "sympathies continue to be with the Cunningham family." It said that today any clinical reviews or peer-to-peer conversations related to proton beam therapy are conducted by board-certified radiation oncologists. The company did not answer a question about efforts more generally to match specialists to the treatment requested.
'Frequent Flyers'
A small group of doctors — about 2%, termed "frequent flyers" by one study author — are responsible for 40% of medical malpractice claims in the country.
In 2013 Dr. John Stripling stopped working as a urologist, according to a deposition he gave in a product liability case. Around that time he faced medical malpractice lawsuits from patients in two states who alleged he botched enlarged prostate procedures.
In total, Stripling settled cases with 11 former patients between 2014 and 2017 with a combined payout of $3.6 million, according to Florida Department of Health records. After receiving "malpractice information," the Arkansas State Medical Board told Stripling in 2015 that he would have to appear before the board if he wanted to renew his license, which was expiring. He never did.
Stripling was able to maintain his license in Florida, state records show, and he began working for health insurers in 2016, according to his LinkedIn profile. His most recent job, his profile said, was as a medical director for naviHealth, a unit of UnitedHealth Group's Optum business, where he weighed in on placements of patients released from the hospital. A UnitedHealth Group spokesperson said Stripling left naviHealth in March.
A 2014 lawsuit filed in Arkansas state court by Larry Stanley, a patient of Stripling's, alleges that dozens of the doctor's patients in that state and Mississippi experienced severe and unacceptable complications when the doctor performed a procedure known as transurethral laser ablation of the prostate, or TULAP. The procedure uses a laser to treat an enlarged prostate, which can otherwise cause problems with urinating.
The lawsuit alleged that a nurse who worked with Stripling reported to another urologist that 40 of Stripling's patients who underwent the TULAP procedure experienced "unprecedented complications." The office manager and head nurse in Stripling's practice were so alarmed by the high rate of complications that they went directly to the chief executive officer of the company Stripling worked for, according to Stanley's lawsuit.
After Stanley's TULAP procedure with Stripling in 2010, he was left incontinent, had to use catheters to drain his bladder and underwent additional surgeries, according to Stanley's suit. In a court filing in that case, Stripling denied that he was negligent or at fault. The lawsuit was dismissed after both sides said they had resolved the matter, but the court records don't provide any additional detail. Stanley died in 2019. His son Greg recalled his father received about $300,000 in a settlement.
A steelworker in his younger years, Larry Stanley had later owned and operated a sawmill for 40 years. Greg Stanley said his father was a changed man after the surgery. He rarely left home, worried he would have wet spots on his clothes.
"This doctor butchered him," Greg Stanley said.
In a 2012 deposition in a malpractice case in Mississippi, Stripling said he stopped doing the laser prostate operation on Dec. 7, 2010, when he had a "coming-to-Jesus meeting" with himself and concluded "this is it." At least eight of the settlement payments made in his malpractice cases involved incidents that occurred in 2010, according to the licensing records.
Stripling said in the deposition that too many of his patients "were doing poorly" after their operations. "There was something flawed in what was being done; and I didn't have a clear answer, but it was time to make a decision," he said. He testified that he went back to performing an older procedure that didn't involve a laser.
That Mississippi case later settled for $305,000, according to Florida state medical licensing records. In a court filing, Stripling said he complied with the standard of care and was not negligent in his treatment of the patient.
Stripling did not respond to phone messages, emails and letters with detailed questions sent via FedEx. The UnitedHealth Group spokesperson reiterated that the company's medical directors go through a rigorous hiring process, that their performance is regularly reviewed and that the company provides ongoing training.
Another "frequent flyer" was Cigna's Kasemsap, who settled five malpractice suits after denying in court filings that he was negligent.
It was in November 2006, during a colostomy reversal surgery, that Kasemsap allegedly connected a 42-year-old woman's vagina to her rectum, according to a malpractice complaint filed in state court in St. Augustine, Florida. The mistake caused air and feces to pass through the vagina, and the patient had to undergo three more surgeries, according to the complaint.
A month later, according to allegations in another lawsuit, Kasemsap mistakenly cut a patient's common bile duct and an artery during a gallbladder surgery. A jury found him negligent in that case and awarded the patient $600,000. Kasemsap and the patient subsequently agreed to settle the case.
Kasemsap's malpractice insurer made another payment to a patient who said in a lawsuit that he had suffered from a mild case of hemorrhoids that Kasemsap wrongly diagnosed as a far more serious case. The doctor then negligently performed a 2007 surgical procedure that left the patient with "constant, severe physical pain and suffering, incontinence and irritation," the complaint said.
Kasemsap settled two more malpractice cases for incidents in 2009, including one filed by Loretta Murphy's family after her death, court records show.
Kasemsap started working for insurers in 2013, according to his LinkedIn profile, which boasts about his contributions to companies' financial health.
As a senior medical director at Highmark, a Blue Cross Blue Shield plan, he claimed credit for saving $3 million a year by removing high-cost specialty drugs from automatic authorization, his profile said. He also said he saved the company $15 million by initiating step therapy in the treatment of macular degeneration. Step therapy generally requires patients to try less expensive treatments before more expensive ones. (When asked about Kasemsap's profile, a spokesperson for Highmark wrote, "We can't speak to how Dr. Kasemsap categorizes his work. Medical directors use evidenced-based guidelines and the unique clinical picture of each member's case to render medical necessity decisions only, which is agnostic of cost.")
Since late 2019, Kasemsap has worked at Cigna, where he not only has reviewed treatment requests but has also managed other medical directors who handle Medicare Advantage requests for care, according to his LinkedIn profile. Kasemsap has thrived in his role at Cigna, and the company made him part of its Physician Leadership Development Program, which provides business and leadership skills.
Kasemsap's success at Cigna came as a bitter surprise to the Murphy family.
When Loretta Murphy's daughter Amanda Cain was young, her mother would play beauty parlor with her. Murphy would do Amanda's hair like she learned in cosmetology school, and Amanda would paint her mother's nails — purple with pink and white flowers.
"Her favorite flower was hibiscus, so I would always try that on the toes," said Cain, who ended up pursuing her own career in cosmetology.
Cain was a junior in high school when her mother went to Kasemsap to get her gallbladder removed. The procedure was only supposed to take about an hour. When more than an hour passed, Cain started to get nervous. Her grandparents were in the waiting room and eventually took her home to look after her younger sister.
The next time Cain saw her mother, she was lying in a hospital bed with a machine helping her breathe.
Murphy died a year before Cain graduated from high school. It was just one of many life events her mother never got to witness, including the birth of Cain's two children.
That Kasemsap has any say in the well-being and health of vulnerable people is maddening, Cain said.
"What do you say about anyone that would hire this guy knowing what they know?" she asked. "How, how would they still hire him?"
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Insurers deny tens of millions of claims every year. ProPublica is investigating why claims are denied, what the consequences are for patients and how the appeal process really works.
