Medicare Advantage plans denied prior authorization requests at unusually high rates, HHS report finds

Key Points:

• A Department of Health and Human Services (HHS) inspector general report revealed that some of the largest Medicare Advantage plans denied rehabilitation and other critical service requests at unusually high rates, with denial rates ranging from 8% to 80% among companies.
• When patients appealed denials for skilled nursing facility care, plans reversed 95% of those denials, indicating potential issues at the initial prior authorization request stage.
• Medicare Advantage plans, which receive fixed government funding and can profit by lowering costs, often use prior authorization as a cost-cutting tool, leading to delays or denial of necessary care, especially for expensive services like long-term acute care and inpatient rehabilitation.
• The report found that UnitedHealthcare, CVS Health, and Humana had the highest denial rates, sometimes exceeding 70%, affecting nearly 20 million Medicare Advantage enrollees.
• The HHS inspector general recommends more regular collection of prior authorization data by CMS to investigate denial rate variations, amid concerns that for-profit insurers may prioritize profit over medical necessity in coverage decisions.