For SNFs operating under MA contracts, this research shows that algorithm-assisted authorization tools are likely to impact length of stay and the revenue tied to it.
Algorithmic Decision-Making in Health Care: Evidence from Post-Acute Care in Medicare Advantage
Health insurers use predictive algorithms to determine the necessary level of care and deny services they deem unnecessary. Using a difference-in-differences design, I study the partnership of a large Medicare Advantage insurer with a firm that uses a predictive algorithm to aid post-acute care coverage decisions. This partnership led to an immediate and sustained 13 percent decline in the length of skilled nursing facility stays. This effect was partially driven by large declines in longer skilled nursing facility stays (over 30 days). Despite reductions in health care use, I do not observe changes in health outcomes following the adoption of the predictive algorithm.
— Journal of Health Economics, December 2025
Marr, Jeffrey. “Algorithmic Decision-Making in Health Care: Evidence from Post-Acute Care in Medicare Advantage.” Journal of Health Economics, 8 Sep. 2025. https://www.sciencedirect.com/science/article/abs/pii/S016762962500090
Insurer Use of Algorithms Cuts SNF Length of Stay by 13%
Medicare Advantage plans’ increasing use of predictive algorithms to assist in “high-stakes” decisions is leading to substantial and immediate cuts to nursing home lengths of stay, a new study confirms.
— McKnight’s Long-Term Care News, December 5, 2025
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