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Healthcare insurers are using AI for claim denials, but physicians can battle back by using AI to help get claims approved, thereby unlocking revenue.

Artificial intelligence (AI) has transformed the way nearly every industry conducts business. Within the healthcare industry, AI plays a role in everything from clinical practice to administrative tasks. Unfortunately, insurers are increasingly denying physicians’ claims via AI-powered algorithms, with the number of denied claims reaching unparalleled heights. In turn, administrative burdens are increasing, and physicians are experiencing significant revenue delays or, in some cases, revenue losses. There is hope, however. According to Jim Bohnsack, chief strategy officer at revenue-cycle management (RCM) services company Aspirion, just as insurers are using AI to deny claims, physicians can use AI to get claims approved.

Rising Denials & Administrative Strain

According to an American Medical Association (AMA) report, claims denials increased from 8% in 2021 to 11% in 2023, resulting in approximately 110,000 unpaid claims—a substantial administrative burden. Furthermore, recent studies have found that among initial claims submissions to private payers, nearly 15% were denied, regardless of whether submitters had obtained prior authorization. Bohnsack notes that in 2023, healthcare providers spent $19.7 billion fighting against denials, often facing subsequent financial difficulties. In such situations, administrative burdens mount as staff members must focus their time on due diligence to determine the most effective way to resubmit denied claims. Ultimately, administrative costs rise along with reimbursement delays and revenue issues. What’s worse, adds Bohnsack, claims denials adversely affect patient care, resulting in potentially delayed or, in the most abysmal cases, completely forgone treatments and procedures.

AI-Driven Solutions for Revenue Recovery

Bohnsack asserts that physicians need to adapt with the times and change their approach to RCM by embracing AI, thereby securing both revenue and patient wellness. One specific benefit of AI is its ability to perform numerous time-consuming, repetitive tasks (such as data entry) that would otherwise drain provider and staff time from more high-value responsibilities. Not only can AI assume these tasks, but it can also do so more quickly and precisely than humans. Another benefit of AI, notes Bohnsack, is its predictive analytics—the ability to find patterns and make predictions regarding large amounts of data, potentially pinpointing issues with claims prior to their submission. Bohnsack also notes that, in the event of a claim denial, AI can generate accurate and convincing appeals that are more likely to yield a positive outcome. AI can also learn and improve, evolving and enhancing its capabilities with every new piece of data it encounters.

Implementing an AI-Enabled RCM Framework

Bohnsack suggests a structured approach to using AI, which involves targeting and effectively defining uses and purposes, a foundation of high-quality data to train the AI system, and a technological infrastructure that can be effectively integrated with an existing healthcare IT system. In addition, Bohnsack urges physicians to bear in mind that human expertise remains a valued component of the process, so having a team with robust knowledge in areas such as data science and healthcare is imperative.