What changed
Blue Cross Blue Shield released an analysis on September 24 showing hospitals using AI medical coding tools added $942 million to insurer costs over two years. The AI scans patient records and flags secondary conditions that bump the claim into a higher payment category. Between early 2023 and late 2025, the share of complex cases billed to Blue Cross plans rose from 37% to 40%. But treatment rates didn't change to match. Patients billed for anemia didn't receive more transfusions. Patients coded for intestinal blockages didn't get more interventions. The bills went up. The care didn't. Blue Cross says 70% of health plans now identify AI coding as a top cost driver.
What you can do with it now
If you run a clinic, dental office, or any practice that bills insurance, check what your billing software or AI scribe is coding before the claim goes out. AI documentation tools can save hours on notes. But if the tool auto-suggests a secondary diagnosis you didn't treat, and your biller submits it, you're on the hook if the insurer audits. Review every claim that gets bumped to a higher code. Ask your biller to show you the comparison: last year's code for the same visit versus this year's. If you're buying AI scribes or billing assistants, ask the vendor whether the tool codes conservatively or aggressively, and whether you can turn off automatic upcoding. You want the time savings without the audit risk.
What to keep in your own hands
Never let the AI submit a diagnosis you didn't document and treat. You sign the chart. You own the audit. If the AI flags a condition the patient has but you didn't address in this visit, decide whether it belongs on this bill or the next one. Insurers are deploying their own AI to downcode claims, so the tool that raises your revenue today may trigger a clawback tomorrow. Keep a log of every claim the AI touched, and compare your audit rate before and after you started using it. If denials or reviews spike, that's your signal to tighten the rules. And make sure your contract with the AI vendor says you can leave and take your billing history with you. The tool should make your work easier, not make your insurer suspicious.