Fighting AI with AI: A Hospital CFOs Guide To Reversing The Denial Crisis

The Payer Advantage Is Now an Algorithmic One 

In two months of 2022, a major payer signed off on roughly 300,000 claim denials using an algorithmic automated review system, spending an average of 1.2 seconds per case, according to internal documents reviewed by ProPublica. That is faster than most people can read this sentence. That payer disputes the characterization of the system as artificial intelligence, but the operational reality is the same: automation has compressed payer claim review from minutes to fractions of a second. 

The pattern repeats across the industry. A 2024 U.S. Senate Permanent Subcommittee on Investigations report found that UnitedHealthcare’s prior authorization denial rate for post-acute care more than doubled — from 10.9% in 2020 to 22.7% in 2022 — during the same period the company expanded its use of automated and predictive technologies for prior authorization. Elevance Health, which serves more than 110 million members, now reports that over 60,000 of its associates use AI productivity tools, with AI as a strategic enabler of its operations. 

Meanwhile, only 46% of hospitals and health systems have adopted AI in their revenue cycle operations, per a recent survey. Payers automate denial at industrial scale; most provider RCM teams still work claims one at a time using spreadsheets and manual processes.