Reed Smith Client Alerts

Key takeaways

  • Recent litigation regarding use of AI by MCOs is directed at the use of automated claims adjudication as opposed to true use of AI in claims determinations.
  • Enhanced transparency regarding the role AI plays in the claims adjudication process vis-à-vis claim reviewers is recommended.
  • Many of the same best practices regarding implementation of automated claims adjudication processes should be applied regarding the use of AI in the claims review process.

Several recent class action lawsuits have been filed against managed care organizations (MCOs) by members and shareholders in federal district courts across the nation related to the use of algorithms (or, more precisely, artificial intelligence (AI)) as part of the claims review process. While the media and politicians may characterize these cases as AI cases, in fact, the cases often lack allegations that are specific to the use of AI. Rather, the allegations focus on decision-making by computer algorithms (whether AI or not) and not health care professionals. While the lawsuits may ultimately involve the use of AI, that is not a necessary condition for these claims as the cases are challenging the use of computer algorithms as part of the claims process.