Health Giant Cigna Sued Over Algorithm Allegedly Used to Deny Coverage to Patients

July 26th, 4:11 PM EDT

Updated:

July 27th, 1:46 PM EDT

General views of the Cigna health care corporate offices on October 22, 2020 in Glendale, California.

Photo by AaronP/Bauer-Griffin/GC Images

SACRAMENTO, Calif. (NEWSnet/AP) — A federal lawsuit alleges that health insurance giant Cigna used a computer algorithm to automatically reject hundreds of thousands of patient claims without examining them individually as required by California law.

The class-action lawsuit, filed Monday in federal court, says Cigna Corp. and Cigna Health and Life Insurance Co. rejected more than 300,000 payment claims in just two months last year.

The company used an algorithm called PXDX, shorthand for ''procedure-to-diagnosis,” to identify whether claims met certain requirements, spending an average of just 1.2 seconds on each review, according to the lawsuit. Huge batches of claims were then sent on to doctors who signed off on the denials, the lawsuit said.

Ultimately, Cigna conducted an “illegal scheme to systematically, wrongfully and automatically” deny members claims to avoid paying for medical necessary procedures, the lawsuit contends.

Connecticut-based Cigna has 18 million U.S. members, including more than 2 million in California.

The lawsuit seeks unspecified damages and a jury trial.