Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care

Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care

A central concern about the capitated payment model used in Medicare Advantage is the potential incentive for Medicare Advantage Organizations (MAOs) to deny beneficiary access to services and deny payments to providers in an attempt to increase profits. Although MAOs approve the vast majority of requests for services and payment, they issue millions of denials each year, and CMS annual audits of MAOs have highlighted widespread and persistent problems related to inappropriate denials of services and payment.

Our case file reviews determined that MAOs sometimes delayed or denied Medicare Advantage beneficiaries’ access to services, even though the requests met Medicare coverage rules. MAOs also denied payments to providers for some services that met both Medicare coverage rules and MAO billing rules. Denied requests that meet Medicare coverage rules may prevent or delay beneficiaries from receiving medically necessary care and can burden providers. Although some of the denials that we reviewed were ultimately reversed by the MAOs, avoidable delays and extra steps create friction in the program and may create an administrative burden for beneficiaries, providers, and MAOs.

— Office of Inspector General, U.S. Department of Health and Human Services, 27 Apr. 2022

Grimm, Christi A. “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care.” U.S. Department of Health and Human Services, Office of Inspector General, 27 Apr. 2022. https://oig.hhs.gov/reports/all/2022/some-medicare-advantage-organization-denials-of-prior-authorization-requests-raise-concerns-about-beneficiary-access-to-medically-necessary-care/.

Amid Rising Complaints About Prior Authorization Under Medicare Advantage, New Rule Leaves Gaps

Complaints to Congress are reflected in data: A November 2023 survey by the Medical Group Management Association reported that 89.4% of respondents found prior authorization requirements “very or extremely burdensome.” An October 2023 study led by Fumiko Chino, MD, found that 22% of patients with cancer did not receive recommended care due to prior authorization delays or denials.

So far, reform efforts have brought mixed results. Starting last fall, new CMS guidance governed Medicare marketing in response to numerous complaints, but some believe legislation is needed to end abuses. Although a new CMS rule will require timely decisions in several areas, it does not address denials for drugs, which is an area of serious concern.

— AJMC, 15 Apr. 2024

Nursing Home Surprise: Advantage Plans May Shorten Stays to Less Time Than Medicare Covers

Health care providers, nursing home representatives, and advocates for residents say Medicare Advantage plans are increasingly ending members’ coverage for nursing home and rehabilitation services before patients are healthy enough to go home.

“In traditional Medicare, the medical professionals at the facility decide when someone is safe to go home,” said Eric Krupa, an attorney at the Center for Medicare Advocacy, a nonprofit law group that advises beneficiaries. “In Medicare Advantage, the plan decides.”

— KFF Health News, 4 Oct. 2022

Medicare Advantage Prior Authorizations are Often Unnecessarily Denied

Medicare Advantage organizations (MAOs) often delay or deny services for medically necessary care, even when prior authorization requests meet coverage rules, according to a report by the OIG.

“Denied requests that meet Medicare coverage rules may prevent or delay beneficiaries from receiving medically necessary care and can burden providers. Although some of the denials that we reviewed were ultimately reversed by the MAOs, avoidable delays and extra steps create friction in the program and may create an administrative burden for beneficiaries, providers, and MAOs.”

— HealthLeaders Media, 6 May 2022

Medicare Advantage Plans Deny Prior Authorizations That Meet Medicare Approval, OIG Says

Examples of healthcare services involved in denials that met Medicare coverage rules included advanced imaging services such as MRIs and stays in post-acute facilities such as inpatient rehabilitation facilities.

“We found that among the prior authorization requests that MAOs denied, 13% met Medicare coverage rules — in other words, these services likely would have been approved for these beneficiaries under original Medicare.”

— Healthcare Finance News, 29 Apr. 2022

OIG Dings Medicare Advantage Plans for Use of Prior Authorization

OIG found that 13% of prior authorization denials fit within Medicare coverage requirements, as did 18% of denied payment requests. Medicare Advantage plans did reverse some denials that fit within the Medicare coverage guidelines, typically when a patient or provider disputed the decision.

— Fierce Healthcare, 28 Apr. 2022