A federal lawsuit filed this week alleges Cigna, a health insurance giant with 18 million U.S. members, violated California law by using a computer algorithm to automatically deny hundreds of thousands of patient claims.
The filing calls the algorithm’s use an “illegal scheme to systematically, wrongfully and automatically” reject more than 300,000 claims in just two months last year.
It says Cigna then sent denials to doctors in huge batches for signoff, leaving surprised patients on the hook for necessary medical procedures.
The class-action suit, which was filed on behalf of two Cigna members in Placer and San Diego counties who were forced to pay for tests after the company denied their claim, asserts these actions violate a California law requiring fair and thorough reviews.
The suit also alleges that Cigna used the PXDX algorithm, short for ''procedure-to-diagnosis," to shield itself from accountability for claim denials.
In a statement, Cigna said it uses industry-standard methods to pay doctors more quickly for common, low-cost procedures, and added that patients can always appeal.
Research on medical insurance in general suggests only a fraction of those insured ever do so.
