AI-Generated Prior Authorization Letters: Strong Clinical Content, Weak Administrative Scaffolding

Increasing staffing constraints and turnaround-time pressures in Prior authorization (PA) have led to increasing automation of decision systems to support PA review. Evaluating fairness in such systems poses unique challenges because legitimate clinical guidelines and medical necessity criteria often differ across demographic groups, making parity in approval rates an inappropriate fairness metric. We propose a fairness evaluation framework for prior authorization models based on model error rates rather than approval outcomes. Using 7,166 human-reviewed cases spanning 27 medical necessity guidelines, we assessed consistency in sex, age, race/ethnicity, and socioeconomic status. Our evaluation combined error-rate comparisons, tolerance-band analysis with a predefined $\pm$5 percentage-point margin, statistical power evaluation, and protocol-controlled logistic regression. Across most demographics, model error rates were consistent, and confidence intervals fell within the predefined tolerance band, indicating no meaningful performance differences. For race/ethnicity, point estimates remain small, but subgroup sample sizes were limited, resulting in wide confidence intervals and underpowered tests, with inconclusive evidence within the dataset we explored. These findings illustrate a rigorous and regulator-aligned approach to fairness evaluation in administrative healthcare AI systems.

Claim denial management costs U.S. healthcare approximately $260 billion annually in administrative overhead. Large Language Models (LLMs) and Retrieval-Augmented Generation (RAG) can produce fluent clinical text, but single-agent architectures fail in high-stakes healthcare: they introduce unsupported clinical details and lose the logical structure of hierarchical payer policy. We propose AGVF (Agentic Governance and Adversarial Verification Framework), a multi-agent architecture for medical-necessity appeal generation under explicit policy and evidence constraints. AGVF models appeal synthesis as a Constrained Markov Decision Process (CMDP) over five agents: policy formalization, evidence retrieval, gap analysis, adversarial critique, and gated synthesis. We prove that refinement over a fixed policy constraint graph monotonically reduces evidence-deficiency and terminates with either a complete satisfying frontier or a localized evidence gap. A deterministic citation- grounding gate prevents assertions without admissible evidence from entering shared state. We provide a reference implementation and validate it on 1,000 synthetic appeal cases parameterized from de-identified public hospital discharge data. The validation confirms zero citation-grounding violations across all AGVF cases and monotone deficiency reduction in every episode; ablating the gate raises violations to 100%, confirming it is load-bearing. The study uses no real patient records and does not measure clinical efficacy. AGVF thus contributes a theory-backed agentic architecture and verified reference implementation for policy-constrained LLM generation in healthcare.

As large language models (LLMs) are increasingly used in clinical settings, it is critical to evaluate their reliability under realistic variation in clinical text. We study this question in clinical triage, comparing LLMs to practicing physicians under text perturbations that preserve the underlying clinical setting. We introduce a benchmark of over 6,000 clinical scenarios, 7,000 physician annotations, and 225,000 model responses. Using this benchmark, we make two key observations. First, LLMs are more likely than physicians to recommend unnecessary care at baseline, and this tendency increases under perturbed inputs. Further, we find that LLM recommendations are more sensitive to gender and tone perturbations than human recommendations. Together, these results demonstrate that LLMs can vary under clinically irrelevant textual changes, highlighting the need for deployment-oriented evaluations grounded in expert physician behavior.