A class-action lawsuit filed in federal court accuses Anthem Blue Cross of using an AI algorithm to systematically deny legitimate medical claims, seeking $2.3 billion in damages on behalf of an estimated 3 million policyholders affected between 2023 and 2026.
Allegations
The lawsuit, filed by the law firm Lieff Cabraser, presents internal documents and expert analysis alleging that Anthem's claims processing AI was optimized to minimize payouts rather than evaluate medical necessity.
- AI system allegedly denied claims within seconds without human review in 68% of cases
- Denial rate increased from 14% to 23% after AI system deployment in 2023
- Internal communications reference "savings targets" tied to AI denial rates
- Whistleblower testimony from former claims adjusters corroborates systematic override of clinical guidelines
Industry Impact
The lawsuit is the largest of several targeting AI-driven claims processing across the insurance industry. State insurance commissioners in California, New York, and Illinois have opened investigations into algorithmic claims processing at multiple insurers.
