You are right, BUT: Those denials have to follow contractual terms. I know a local (Europe) real world example where a friend of a friend (insurance company area manager) literally was told "this is your sum of money on claims that you can accept in this quarter, it cannot go above that". Which either you get lucky and make the quota, or you screw people over and hope they don't sue. And since we live in a world where the company wants "a little more" each year, well.. I don't see how this ends well.

The same problem does not apply to our social services (including health insurance) as they dont have to make profits at all costs.