Not only is the Department of Managed Care requesting payment, but they want interest paid too.  Blue Cross said they settled matters on claims back in 2010 but perhaps this is another new issue as they paid fines a couple years ago.

Yes we are back to those nasty algorithms again that determine payment and if the code doesn’t run write or is not written correctly we have flaws.  The full amount due is waiting a full audit of all the claims.  Back a couple years ago Blue Cross used this ugly algorithm…again processes to where no human usually touches the claims and the servers running 24/7 make the decisions.  Here’s a 3rd party along with Blue Cross that got caught on a stress test algorithm.  This one was pretty blatant and Med Solutions shut down the website back when I wrote the post over this. 

Med Solutions and Blue Cross Caught On the Stress Test Denial Algorithm (video)

We might still have this court case tied up too where Blue Cross used Ingenix (division of Untied Healthcare) algorithms to short pay.  The AMA settled a suit with all carriers using the United/Ingenix algorithms a couple years ago for almost 15 years of short pay on out of network claims. 

Class Action Lawsuit Filed Against Blue Cross Blue Shield in Florida – Out of Network Ingenix Algorithms

Insurance companies live off of their algorithms for every step of business they conduct and why we need to get into the math and algos.

WellPoint Creates Reimbursement Algorithm to Cut Down Hospital Annual Payment Increases and Reward Only Those Who “Score” Well–Analytics on Steroids

This particular algorithm was pretty nasty to where parameters set in the code cancelled women who had breast cancer too.  The word “fraud” detection is used and sometimes with the way the SQL statements are written, you false positives. 

WellPoint Ran a Breast Cancer Algorithm to Target Members for Cancellation of Policies - “Fraud Detection” is the Catch All that Justifies the Reporting

You know we go through all this trouble to certify and make sure medical records software is compliant and accurate but look what happens with the payers here and they have rogue algorithms running making decisions and denying care or money every where you turn around. 

HHS Issues Final Rule for Health Insurers To Justify Increases–Need to Certify Insurance Algorithms For Calculation Just Like We Certify Electronic Record Algorithms

Now you can see why I was motivated to write about the “Attack of the Killer Algorithms” in healthcare and in the financial world too.  Check all 7 part at the link below.  All I can wish for is that our new Financial Consumer Chief doesn’t sit in denial in this area as we need help auditing corporate USA algos.  BD  

President Appoints Richard Cordray as New Consumer Financial Protection Chief - Hope He Knows And Understands Correcting Flawed Math and Formulas To Battle the “Financial Attack of Killer Algorithms” On Consumers With Banks and Corporate USA

The California Department of Managed Health Care ordered Anthem Blue Cross of California to pay health care providers for services provided dating back to 2007 after a financial claims audit discovered alleged errors in how the company paid claims. Under the order, the company will be required to pay interest on any claims that are found to have been improperly paid.

The order stems from an audit conducted by the DMHC in 2008 that examined claims payment practices at the seven largest health care providers in California. The department launched the audit after it saw an increased number of complaints from providers about payments that were either late or inaccurate. In some cases, claims were inappropriately denied, the department said in a statement.

The DMHC required the plans to pay providers the money they were owed and to demonstrate improvements to the plans' claims processes to prevent future errors. Carriers also entered into settlement agreements to pay administrative fines for their allegedly improper claims practices. To date, six of the seven plans have undertaken provider remediation efforts.

Rodger Butler, a spokesman for the department, said as many as 2.6 million claims submitted to Anthem Blue Cross have been called into question. Butler said the department has not assessed a total for how much Anthem Blue Cross may owe because it is awaiting the results of a review of those claims.


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