There's an easy solution to this that the Federal Employee Program (aka FEP) [0] uses -- regular, external accuracy audits.
The relevant metric to customers isn't "What percentage of claims are denied?" given the substantial amounts of medical claim fraud.
It's "What percentage of claims are denied... that should have been approved?"
So you regularly audit a random sampling of denials, publish the results of that audit transparently, and provide a financial incentive for insurers to keep their numbers below a certain threshold.
It's worked pretty well for FEP -- to the extent that FEP insurers typically have segregated operations from the rest of the company and do much better on denial accuracy and other metrics.
Wrongful care denial should be considered a serious felony on par with assault with intent to do grave bodily harm. It should be a veil piercing crime that exposes every insurance company employee involved in denial to personal legal jeopardy should they wrongly deny claims. Reasons for denials must should be required to be extremely detailed and provided to the institutions requesting coverage. Upon receiving a denial, the health care institution should be able to evaluate the denial for validity and choose to refer the denial to local prosecuting attorneys if the denial is medically unsound.
It would harm profits and maybe give the idea that an LLC doesn't give you license to break the law with impunity. The veil piercing aspect especially would be a major departure from how corporate liability currently works.
I think the biggest barrier is that it inconveniences the powerful to benefit the masses.
Hasn't in the FEP program. Mostly because there's no incentive: doing so helps your competitors as much as you. And it's more profitable to invest those dollars in hitting KPIs.
These "bolt on" type of solutions work but they also raise the costs. Already the administration costs of insurance are through the roof. The system is as inefficient as humanly possible. Hospitals needs hundreds of administrators and billing specialists just to make insurance work - never mind the patient and doctor time lost.
And now, we also pay to audit insurance? It's too much money burning.
This shouldn't be done by the private sector, period. The reason our costs are so insanely high is because of insurance the sheer inefficiency it brings to care.
It seems you've answered your own question - they'd be significantly lower with single-payer.
But to expand, the US has, by far, the highest cost per capita for healthcare at just a bit over 12,000 dollars a year when compared to similar countries. A large part of this is due to our inefficient system, in which administrative costs are astronomically high:
"administrative expenses account for approximately 15% to 25% of total national health care expenditures, an amount that represents an estimated $600 billion to $1 trillion per year of the total national health expenditures of $3.8 trillion in 2019."
There's multiple fundamental problems with the healthcare system that causes this. Again, these problems are fundamental, meaning they cannot be resolved within the constrains of a private sector insurance industry:
1. Insurance billing complexity is extremely high. There are thousands of insurers nationally, and providers are forced to navigate through that to provide adequate care. As a result, many private practices have gone out of business, because doctors spend more time managing insurance than patient care.
2. Insurance has an incentive to deny as many claims as possible. There's simply no way around this fact - the only way to remove this incentive is to remove insurance.
3. Insurance is not transparent to consumers and consumers typically have little to no choice, killing competition and allowing price gauging.
4. Providers are incentivized to charge as much as the most premium insurer in their area allows. For example, if insurer X covers 650 dollars for a treatment but insurer Y only covers 150, then the provider must charge 650. Otherwise, they leave money on the table for patients with provider X. This means that competition in the insurance space doesn't lower prices - it can only raise them. Yes, as boutique plans for employees such as CEOs gets better, your care gets more expensive.
It's a question of what we want to measure. There's a metric that represents how much a claimant sees in unexpected costs due to denied claims vs impact on care from the insurer.
A denied prior auth results in no unexpected costs but perhaps a change or delay in care.
A denied claim to an in network hospital may result in the provider losing revenue but nothing for the claimant.
The relevant metric to customers isn't "What percentage of claims are denied?" given the substantial amounts of medical claim fraud.
It's "What percentage of claims are denied... that should have been approved?"
So you regularly audit a random sampling of denials, publish the results of that audit transparently, and provide a financial incentive for insurers to keep their numbers below a certain threshold.
It's worked pretty well for FEP -- to the extent that FEP insurers typically have segregated operations from the rest of the company and do much better on denial accuracy and other metrics.
[0] https://en.m.wikipedia.org/wiki/Federal_Employees_Health_Ben...