Latest / Off the Chart: A Business of Medicine Podcast / S1 Ep59: AI and claim denials with Neal K. Shah, co-founder of Counterforce Health
Transcript
- Speaker 1 00:00:00 So you are now literally financially losing 5000 plus dollars of just like straight up write offs because you delivered some care and the insurer didn't pay. Speaker 2 00:00:23 Welcome to Off the Chart The Business of Medicine podcast, featuring lively and informative conversations with healthcare experts, opinion leaders and practicing physicians about the challenges facing doctors and medical practices. I'm your host, Alison Luttrell. This episode features a conversation between medical Economics editorial director Chris Maslin and Neil Shah, CEO of Korea Health Technologies and co-founder of Counterforce Health. They're talking claim denials and how you can use AI to fight them. Speaker 3 00:00:56 Neil Shah, thanks so much for joining me on. Off the chart. Speaker 1 00:01:00 Thanks for having me, Chris. Really appreciate it. Speaker 3 00:01:02 Can you start off and just tell our audience a bit about yourself? Speaker 1 00:01:05 Yeah, sure. So I'm the CEO of Korea Health Technologies. We're one of the fastest growing caregiving platforms in the country. And also the co-founder of Counterforce Health, which is a AI startup that's growing really rapidly, helping patients and providers fight denied health insurance claims. Speaker 3 00:01:23 That's what we're going to be talking about a bit today is, claim denials. can you talk a little bit about how you, you know, personally got involved with claim denials and, you know, how it sort of changed your perspective on how it all works? Speaker 1 00:01:36 Yeah, sure. So, you know, I've seen it both personally and professionally. so I'd say in my, in my mid 30s, my career background is kind of eclectic. I was a hedge fund manager in New York City, running a $250 million hedge fund focusing across healthcare and technology and other investment areas. And my wife became severely ill and went through years of a cancer battle. And, you know, at that time, I felt it firsthand. you know, there were so many denied claims, everything from kind of routine medications to surgeries, etc. and, you know, we just spent hours and hours fighting it on the phone, you know, with the insurance companies. And granted, that was something where it was more just a financial matter, like where we could handle it and we could just out of pocket pay for the care. Speaker 1 00:02:15 But nonetheless, it was like infuriating. And then that really woke me up to how many people are going through this. And then after that whole journey, I actually started a caregiving company, which is now grown all over the country, helping take care of tons of people through serious illness, through things like dementia. And I'm now seeing it second hand, you know, not just me directly, but all these families using our care platform. They're experiencing so many claim denials. And, you know, the more I kind of like research it, I just realized 1 in 5 Americans on health insurance within the last year have experienced a denied claim. tons of people are forgoing care that's much needed. tons of people are incurring a lot of medical debt and even experiencing bankruptcy, due to kind of financial matters with denied claims. And then worst of all, many people are being discouraged to interact with our healthcare system because of this fear of like, yeah, I should be covered. But you know, due to kind of technicalities, I might be screwed with a huge bill. Speaker 1 00:03:09 so I thought there was like a huge opportunity there. as I researched it more, what I realized is in the last like two plus years, it's almost become like the rise of AI has led to, like, an asymmetric warfare here where, you know, the insurance companies, especially the largest ones, adopted this new technology fast and then started programmatically denying claims and adjudicating kind of claims management. And then everyone from an individual patient to a small clinic to a private practice group of physicians, like everyone else, was just like so disadvantaged because they didn't have this technology built for them. so I feel like it's been asymmetric warfare over the last couple of years. And then as a result, you look at some of these statistics where, you know, in 2022, you went from something like 24% of providers complaining about, you know, claims denials are rising and it's a big issue to 2024. The latest survey suggests 75% of people are complaining it's a big issue. You know, obviously same thing from the patient side. Speaker 1 00:04:04 So I think it's a you know, it's a situation where technology has been weaponized by one side and not by the other side. And I think we need to kind of level the playing field. Speaker 3 00:04:12 Can you talk a bit about the, physician practice, sort of a health care provider angle on this? You know, I think like a lot of people, patients that are out there sort of like understand they read in the media about, like, you know, horrible claim denials for cancer patients and all these things. but can you kind of share your perspective on sort of the provider side and sort of the administrative burden and the issues that they experience? Speaker 1 00:04:38 I think it's a it's a yeah. Thanks for the question. It's an administrative burden as well as a financial burden. You know, it's a really revenue cycle management issue for many providers. So let's say, you know, let's take an example. Neurology. This is a field of extremely high denial rates approaching almost 20%. Right. And there's been a rise of like dementia, therapeutics over the last couple of years, etc.. Speaker 1 00:04:58 and as a result, like the insurers have started denying stuff, at scale. So if you're an independent neurologist, you know, we're based in North Carolina. So let's say somebody actually, I know a neurologist here that uses our software. you are seeing, you know, anywhere between 10 to 15 patients a day over the course of a month, assuming 20% of your patients will be denied something. you're now looking at a number that might be approaching 100 people, experiencing some sort of denial, whether it's prior auth or post care. But let's just say post care as an example, even if the average, dollar amount of that is 200 300 bucks, it quickly becomes a financial issue because now that's like 20,000, $30,000 over a month. Now, of those denials, something like 10 to 15% of them are typically not paid and they'll just end up going to collections. So you are now literally financially losing 5000 plus dollars of just like straight up write offs. because you delivered some care and the insurer didn't pay. Speaker 1 00:05:59 So it's a financial issue to your practice and like a revenue cycle management issue. And then it's an administrative burden issue where the average provider, you know, whether it's the physician, then there's or other staff is spending on average between 12 to 15 hours a week dealing with this stuff. So, you know, just kind of like back and forth, writing detailed appeals, letters, fixing billing code errors, you know, kind of just like the administrative paperwork burden is intense. And on the other side, they've done it really programmatically. So, you know, it's kind of like an uneven battle where it's costing you time, it's costing you money. Like another statistic is from the provider's perspective. The average cost to do an appeal is $43.84. That was from American Hospital Association data last year. And of course, like that varies based on, you know, your staff costs and overhead. But imagine that, that each time, insurer frivolously denies something using some sort of algorithm. You are now at 45 bucks of your practices, time and effort to fight that. Speaker 1 00:07:01 you know, so it's like, you know, you're just wasting money. And of course not. Those appeals are going to win. So, you know, if you lose and then you end up being denied, you're now taking a write off. So I think that that's a it's a big financial issue for practices. And I think that's where, there needs to be kind of democratization of access to AI tools because, the beauty of technology is that this thing can be done at a fraction of the price. I mean, like orders of magnitude difference, you know, like crafting an appeal letter manually for 45 bucks versus doing it through AI for a few cents. You know, it makes a huge difference in your ability to kind of appeal a lot of things faster. Speaker 4 00:07:40 Say, Keith, this is all well and good, but what if someone is looking for more clinical information? Speaker 1 00:07:46 Oh. Speaker 5 00:07:46 Then they want to check out our sister site, Patient Care Online, the leading clinical resource for primary care physicians. Speaker 5 00:07:53 Again, that's patient care online. Speaker 3 00:08:00 Yeah. Let's let's talk about leveling the playing field a bit. So you know, you had mentioned counterforce health. Can you tell our audience a bit about what that is, its mission and like how that relates with this claim denial discussion that we're having? Speaker 1 00:08:15 Sure. Yeah. So we're we're a mission driven technology startup focused on democratizing access to AI tools. So our first product is we built a very robust, text AI system for fully generating a very detailed, well-crafted, robust appeal letters, in seconds, you know, so typically takes less than a minute. uploading everything from plan coverage doc to the specific denial letter to any kind of background, healthcare information on the patient. and it kind of goes through cross-references, a lot of databases to fix billing code errors, cross-references, journals and a bunch of other data we've trained it on to cite reasons for medical necessity, can now address up to 80% plus of reasons why claims are denied and give you a really detailed, you know, 6 to 10 page well-crafted appeal letter in a matter of seconds. Speaker 1 00:09:06 And, you know, the benefit of that is that that the technology is costing us, you know, less than now, $0.02, you know, for every iteration. And the quality of work is something that, you know, a clinician and or staff would have to spend at least a couple of hours on, you know, some of these letters, you know, we've been able to generate, you know, we'll have like, you know, clinical chiefs of large health care systems say, okay, that would have taken me five, six hours of detailed, detailed work to write. so I think it's like really saving people a lot of time. And by saving time, you're saving money and you're able to do this for pennies on the dollar. so that's that's kind of our first product. Our second product is a, a genetic voice AI that we call Maxwell. and that is, is right now it's being beta tested by some providers. But I think that's going to be kind of our biggest product for 2025 is the ability to take all that info for not just the appeal letter, but then go on, adjudicate it with the insurance company claims and Billings Department on your behalf over phone calls and just handle the whole process start to finish for you. Speaker 1 00:10:06 I think one of the biggest areas for AI innovation in 2025 is AI is going to go beyond just like ChatGPT style usage, where you go and tell it, write this, do this, research this to now start to finish, do a multi-step process for me. You know what they call a genetic AI. And I think that's kind of like very exciting. Now that you're able to almost like one click the entire experience for the provider. And I think that's going to do two things. One, it's going to allow people to appeal a lot more things. You know, right now people are extremely selective about what they appeal because they just can't handle that cost and they don't have the staff time. So now you can kind of appeal everything. Everything got denied. Okay. There's one click appeal it. So I think that's great. And then two I think that's going to significantly improve revenue, you know, revenue cycle management and just overall collections, for the practice. So at at absurdly low cost. Speaker 1 00:10:54 So yeah, super excited. Speaker 2 00:10:59 The following is a brief demonstration of Counterforce Health's voice by Maxwell. Speaker 1 00:11:05 All right. We're going to talk to Maxwell now. Hey, Maxwell, how's it going? Speaker 6 00:11:12 I'm doing well. Thanks for asking. I help people navigate the often complicated world of health insurance appeals. I work with patients and providers to ensure they receive the coverage they need. What brings you here today? Do you have any recent experiences or interactions with the health care system you'd like to dive into? Speaker 1 00:11:28 Yeah, I'd love to. Maxwell, can you share the most shocking statistic about insurance claim denials that most physician practices don't even realize is costing them thousands or hundreds of thousands in lost revenue? Speaker 6 00:11:43 One statistic that really stands out is that approximately 47% of all denied claims are never appealed, which can leave a substantial amount of revenue uncollected. In fact, hospitals lose an average of $5 million annually to claim denials. And for smaller practices, even a modest denial rate can result in losses exceeding $180,000 per year. That's a significant amount of money that could be recovered with the right approach to appealing denials. Speaker 6 00:12:08 Would you like to hear more about how I help patients and providers navigate the appeals process? Speaker 1 00:12:14 Yeah, Maxwell, that would be great. You know, can you help us understand what are the three most common denial reasons that you've identified that physician practices can fix immediately to boost their collection rates by at least 15%? Speaker 6 00:12:30 The three most common denial reasons that physician practices can fix immediately to boost their collection rates are incomplete or incorrect patient information, lack of prior authorization, and coding errors. By addressing these issues, proactively reduce denial rates significantly. For example, verifying patient information during check in and ensuring insurance coverage is validated before services are rendered can make a big difference. Similarly, obtaining prior authorization for specific treatments and using automated claims scrubbers to catch coating errors can also help by fixing these common denial reasons. Practices can shorten payment cycles, improve cash flow, and recover lost revenue. I've seen it make a real impact in the cases I've worked on. Would you like me to walk you through a specific example of how I've helped a patient or provider appeal a denial? Speaker 1 00:13:16 Yeah. Speaker 1 00:13:16 Yeah. Thanks, Maxwell. Can you walk us through a demo of how you make health insurance pay? Speaker 6 00:13:23 I'd be happy to walk you through a demo. Let's take a look at one of my previous cases. I've worked on several, but I'll choose one. That might be helpful. There's the case of James Wilson, who was denied coverage for his CPAp machine despite having severe sleep apnea. Or there's the case of Sarah Chen, who was denied coverage for specialized endometriosis care. And then there's the case of Michael, a young boy who was denied coverage for ABA therapy. Which one of these cases would you like me to walk you through? Speaker 1 00:13:48 Sure. Could you walk me through the case of James and the denial for the CPAp machine? That sounds really interesting. Speaker 6 00:13:55 James's case is a great example of how I help patients navigate the appeals process. So James had been diagnosed with severe sleep apnea with an eye score of 38 events per hour. His doctor had prescribed a CPAp machine, but his Medicare Advantage plan denied coverage, citing a lack of medical necessity. Speaker 6 00:14:12 When James came to me, I started by documentation, including his sleep, study results, medical records, and the denial letter from the insurance company. Speaker 2 00:14:24 Again, that was Neil Shah speaking with Maxwell Counterforce Health's gigantic voice AI. Speaker 3 00:14:35 So where can providers go to learn more about these tools? Speaker 1 00:14:40 Sure, yeah. Check us out at Counterforce health.org. You know, so counter coup and TLR for healthcare. And as you can tell from the name, we really want to, you know, inspire providers to do like guerrilla warfare against the insurance companies because I hate them. You know, I'll just say, you know, I think they're destroying health care in America and severing the relationship between patient and provider. So I think it's something's got to change. And they're just running unchecked. and or reach out to us. You know, reach out to me personally on LinkedIn. I'm very active on there. If you're interested in collaborating, you know, shoot me a LinkedIn message. I'm active under Neal and L, and then middle initial K and last name. Speaker 1 00:15:16 or you can send us an email, and help at Counterforce Health. And we'd love to help you. you know, we're totally right now. just giving the providers the tools for free as part of our mission. We have a reasonable amount of, like, grant funding. Our parent company, Kara, has just received a huge investment from the American Heart Association as well as the AARP. so it's a real social mission project. of, you know, for the first X number of providers, we'll just kind of give these tools indefinitely for free because it's costing us less and less to run them. And I really think something like this needs to be offered to providers and patients. Speaker 5 00:15:51 Oh, you say you're a practice leader or administrator. We've got just the thing. Our sister site, Physicians Practice. Your one stop shop for all the expert tips and tricks that will get your practice really humming again. That's physicians practice. Speaker 3 00:16:07 So, you know, if you had the ear of a policymaker, you know, in DC or whatever, and you were able to kind of push for reforms for the claim denial process. Speaker 3 00:16:18 You know what? What do you think our country, you know, its health care system needs to do to sort of ultimately fix this denial issue? Speaker 1 00:16:27 Yeah. Great question. I mean, I think first of all, I'd watch the denial rates and then the success on appeals as like a way to sanity check how legit are the denials, you know. So by that I mean, right now, you know, of all the denials in America, less than 1% of them are appealed. And of the ones that are appealed. Something like 40 to 50% are winning on appeal. So that should give you a market signal that something is broken, that people are frivolously denying stuff, knowing that most people it's too much burden to appeal, but that the reason for the denial was kind of not correct. And then that's just a direct appeal to the insurer. If you force it to external review, the win rates are even higher. And then if you take them to court, the win rates are even higher. Speaker 1 00:17:09 So I think that somebody needs to kind of like think through the structure of the denial appeal system and have a little more regulation on kind of like what is allowed to be denied and perhaps even have like some sort of metrics that if the denial rates exceed X amount, then, you know, maybe something's going on. second, I think the, I think this is a big opportunity for patient education, and empowering people to take matters into their own hands from an appeals perspective and independent review. You have no idea how many people I talked to, that are patients dealing with denials where they don't know their rights. I think something like 70% of people don't even know about their appeal rights. So as a result, they don't even bother to take that step. And then if the ones that know and might have done appeals to 3 or 4 times and still got denied, they don't know the rights to kind of an independent review. so I think that there needs to be mass like patient education. but yeah, I mean, I think it's like I don't have like an easy solution. Speaker 1 00:18:07 I think that there is like a real problem. And I think more technology can help here. maybe the government should start, you know, kind of like leveraging AI technology to kind of keep tabs on what insurers are doing and reasons for why things are denied, and perhaps use AI to find patterns in like differences in denial rates, across insurers like and you've seen some of this data, right. That's been out over the last couple of months. But why is one insurance company having a denial rate of 20 something percent and another one is having 12%? You know, it's like doesn't logically make sense. so yeah, I think I think it's like kind of wild, wild West and then and, and don't even me started on prior auth. I mean, that's like a joke, right? Like I'm sorry. I mean, these were like postcards. Prior authors like completely wild wild West. So I think there needs to be a little more regulatory oversight because it's very clear, like these insurance companies are like breaking health care in America. Speaker 1 00:18:57 And I think that the second order effect of patient side people then being scared to go seek treatment and then delaying it as long as possible, obviously that worsens health outcomes and it worsens spending long term, because then they'll come in when they have a serious issue that could have been addressed earlier. And then on the provider side, I mean, think about provider burnout. One of the top cited reasons for provider burnout is people didn't go into healthcare to be a lawyer or an actuary sitting there, you know, arguing financial discussions with an insurance company. Right. Like they went they went into the field to heal people and help people. And I think that we have a shortage of healthcare workforce across America. So I think kind of checking insurance companies power is absolutely necessary if you want to have more health care workers and just have them be happier about the job they're doing. Speaker 3 00:19:41 Is there anything that we haven't discussed that you think it's important to mention about this topic? Speaker 1 00:19:47 no. I mean, I think just like, thanks for the last question. Speaker 1 00:19:49 I really am passionate about advocacy and, catalyzing change at the regulatory and kind of federal level, which I hope and anticipate will be something that's on the agenda for this year and next year, because I think it's gotten out of control. and then, yeah, beyond that, I mean, I think, yeah, thanks for the opportunity. would love to kind of like, demo the product to people and would love to help as many people as we can. I'd say my goal this year is to get a call out on one of the insurer's earnings calls that counterforce health was a line item that caused $100 million of losses at one of the insurers, because I think it's gotten absurdly out of control, you know, and like, no one's checking it. Speaker 3 00:20:25 Neil Shah, thanks so much for joining me today and sharing your insights. I really appreciate it. Speaker 1 00:20:29 Thanks, Chris. Really appreciate the opportunity. Speaker 2 00:20:39 Again, that was medical Economics editorial director Chris Maslin and Neil Shah, CEO of Korea Health Technologies and co-founder of Counterforce Health. Speaker 2 00:20:47 My name is Austin Luttrell, and on behalf of the whole medical economics and physicians practice teams, I'd like to thank you for listening to the show and ask what you please. Subscribe on Apple Podcasts and Spotify so you don't miss the next episode. Also, if you'd like the best stories that Medical Economics and physicians practice publish delivered straight to your email six days of the week. Subscribe to our newsletter at Medical Economics and Physicians Practice. Com oh, and be sure to check out Medical Economics Pulse, a quick hitting news podcast that offers concise updates on the most important developments affecting your practice, your bottom line, and the broader health care landscape delivered by the editorial team at Medical Economics. Off the chart, The Business of Medicine podcast is executive produced by Chris Mazzini and produced by Keith Reynolds and Austin. The Trial Medical Economics, Physicians Practice, and Patient Care Online are all members of the MJG life sciences family. Thank you.