- Private Medicare Advantage plans have wrongly denied members needed care that otherwise would have been covered under the traditional Medicare program, according to a report released Thursday from federal investigators responsible for oversight of the HHS.
- After reviewing a sample of denials, investigators found that 13% of prior authorization requests and 18% of payment denials were wrongly denied and should have been approved under Medicare coverage rules.
- The report from the inspector general's office of HHS calls for improved oversight of MA and urges the CMS to update audit protocols and issue new guidance on medical necessity reviews performed by the plans.
Although the vast majority of requests for services and payment are approved, each year MA organizations deny millions of requests for care and payment raising concerns about whether the program's payment model creates an incentive for such denials in an attempt to increase profits, investigators said Thursday.
MA plans have continued to grow in popularity and enrollment has doubled since 2011. Private plans covered 42% of all Medicare members last year and, by 2030, about half of Medicare members will be covered by an MA plan, per the report.
Investigators specifically examined prior authorization and payment requests that were denied by plans, and whether those denials were inaccurate based on Medicare coverage rules.
Investigators collected data from 15 of the largest MA plans, which together cover about 80% of MA enrollees. From there, they compiled all the denials and categorized by type. Ultimately, investigators analyzed a sample of 430 cases from the first week in June 2019 that were either a prior authorization denial or payment denial.
The report found that 13% of the prior authorization denials were for services that met Medicare coverage rules, or, in other words, were wrongly denied "likely preventing or delaying medically necessary care for Medicare Advantage beneficiaries," the report said.
In one case, a 76-year-old member was denied a walker because the member "had already received a cane within the past 5 years." The estimated cost of the walker was $112, according to the report.
About 18% of the payment denials were for claims that met Medicare coverage rules and were wrongly denied, according to the report.
In one case, a plan denied radiation treatment for a member with a pancreatic tumor because prior authorization wasn't submitted for the service. However, after review, the prior authorization was received and the provider submitted a screenshot of the granted prior authorization. The denial was reversed.
Better Medicare Alliance, an industry group that represents MA plans, said it supports efforts to streamline and simplify the prior authorization process.
Though it noted the study "represents only a narrow sample of Medicare Advantage beneficiaries and polling data shows that less than half of Medicare Advantage beneficiaries have ever experienced a prior authorization themselves ..." Mary Beth Donahue, president and CEO of the Better Medicare Alliance, said in a statement.
The lobby that represents the nation's doctors agreed with the recommendations in the report.
"Surveys of physicians have consistently found that excessive authorization controls required by health insurers are persistently responsible for serious harm when necessary medical care is delayed, denied, or disrupted," the American Medical Association said in a statement following the publication of the report.