Dive Brief:
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California and Colorado are investigating Aetna’s prior authorization practices following a former medical director’s claim that he didn't review patient medical records when deciding on authorization.
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Dr. Jay Iinuma, who was Aetna’s medical director for Southern California between 2012 and 2015, reportedly made the claim in a deposition in October 2016 pertaining to a lawsuit involving the payer denying coverage of a patient with autoimmune disease.
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Iinuma said that instead of reviewing patients’ medical records while considering authorization, he followed guidance from Aetna nurses who reviewed the information.
Dive Insight:
California Insurance Commissioner Dave Jones said his department is investigating Aetna’s practices “in denying claims and requests for prior authorization of care.” He added that the department is also looking into the payer's utilization review process.
“If a health insurer is making decisions to deny coverage without a physician ever reviewing medical records that is a significant concern and could be a violation of the law,” Jones said.
Colorado’s Division of Insurance is also looking into the issue, particularly concerning a person’s right to appeal a coverage decision and making sure Aetna is complying with Colorado law. Though the original issue stems from California, Colorado interim Insurance Commissioner Michael Conway said Aetna’s national footprint suggests it could affect Colorado.
According to the Colorado Division of Insurance, “Colorado law states that in appeals to an insurance company, the physician conducting the review must be familiar with the standards of care for Colorado, must evaluate the appeal, must consult with other specialists if the case is outside of the physician’s area of expertise and must sign a written determination. If the appeal involves what was a request for a pre-authorization of a service, the physician evaluating the appeal must be different than the one who reviewed the initial pre-authorization request.”
In a statement about the issue, Aetna said its company’s medical directors “review all necessary available medical information for cases that they are asked to evaluate. That is how they are trained, as physicians and as Aetna employees. In fact, adherence to those guidelines, which are based on health outcomes and not financial considerations, is an integral part of their yearly review process."
Aetna said it couldn't comment on the specific allegation because of pending litigation.
Beyond the scope of the investigation and negative publicity this case brings, the investigations may raise the alarm because of the pending $69 billion Aetna/CVS Health merger, which the Department of Justice is reviewing. Though the department will be anticipating how the proposed merger may affect competition, a high-profile case and state investigations may play a part in the review. State investigators may also take a closer look at the deal.
Prior authorizations, typically requiring an extra layer of approval before paying for a treatment, are one way that payers have looked to contain healthcare costs.
They are not popular, and can be a headache for hospitals, payers and patients. A December 2016 American Medical Association (AMA) survey reported that physicians were completing an average of 37 prior authorizations each week, which took about 16.4 hours to process.
The Academy Academy of Family Physicians calls prior authorizations “the number one administrative burden” for family physicians. Prior authorizations make “patient care more difficult and certainly more frustrating.”
Despite the issues, prior authorizations are now a regular part of the healthcare system that tries to assure appropriate, cost-effective care. A Medical Group Management Association (MGMA) Stat poll found 86% of respondents said prior authorizations increased over the past year.
Multiple healthcare stakeholders, including the AMA, American Hospital Association, America's Health Insurance Plans, American Pharmacists Association, Blue Cross Blue Shield Association and MGMA, recently released a consensus statement about streamlining prior authorization processes.
The statement highlighted the groups’ “shared commitment to industry-wide improvements to prior authorization processes and patient-centered care.”
It also called for selective application and regular review of therapies that may not require such approval. Through the initiative, the stakeholders hope streamlined prior authorizations can improve care and remove administrative burdens for providers, payers and pharmacists, while maintaining checks in the system to keep costs under control.
The consensus statement suggests prior authorizations are here to stay. However, what the states find during their investigations into Aetna's practices could influence future prior authorizations — and possibly even the biggest proposed merger in healthcare.