The recently issued HHS Office of Inspector General report focusing on Medicare Advantage plan denials titled “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care” (discussed in our companion Alert, Office of Inspector General (OIG) Issues Another Report Highlighting Inappropriate Medicare Advantage Denials) has generated responses from both the insurance industry and providers. While the industry has attempted to downplay, discredit, and otherwise deflect attention from OIG’s findings, many providers and provider groups concur with the findings, and demand that policymakers respond accordingly.
Industry Response – “A Compelling Story of Value and Access”
Not surprisingly, the insurance industry has tried to put its own slant on the OIG report, led by AHIP, the national association of insurance companies. In an article responding to the report titled “Federal Government’s Report on Medicare Advantage: What the Data Show” (April 29, 2022), AHIP repeats its mantra that MA plans deliver “better service, better access to care, and better value for seniors, people with disabilities, and taxpayers.”
In an effort to spin the OIG report in their favor, AHIP describes the report as an “example” of how “a clear look at the data finds that MA is improving affordability and access to high-quality care for the people it serves” and claims that “[w]hen looked at properly, the data actually tell a compelling story of value and access.” Further spinning prior authorization as a “waste-prevention tool,” the AHIP article references the costs of unnecessary medical care. Unfortunately, but not surprisingly, AHIP does not include the billions of annual taxpayer dollars spent on wasteful MA overpayments in their analysis of overall waste in the U.S. health care system (See our companion Alert, (Most) Policy makers Fail to Act on Medicare Advantage Oversight and Overpayment).
Similarly, the industry group Better Medicare Alliance (BMA) issued a press release titled “Better Medicare Alliance Responds to OIG Report on Prior Authorization Use in Medicare Advantage” (April 28, 2022). The press release states that the OIG “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” citing a June 2021 Morning Consult poll.
As noted by the Kaiser Family Foundation in a report issued the same month as the referenced poll, virtually all MA enrollees (99%) are in plans that require prior authorization “for some services” and such authorization “is most often required for relatively expensive services, such as inpatient hospital stays, Part B drugs, and skilled nursing facility stays, and […] for the majority of enrollees for some extra benefits (in plans that offer these benefits), including comprehensive dental services, hearing and eye exams, and transportation.” Thus, it seems to follow that healthy MA enrollees who do not need a lot of services might not encounter a lot of prior authorization.
Further, the Morning Consult poll upon which BMA relies notes that “41% of Seniors have encountered prior authorizations, and the burden this imposes increases for those whose prescriptions or services often require prior authorization” – among those who claim that they often encountered prior authorization, 47% of respondents claimed it was burdensome: 21% claimed it was “a significant burden” and 26% claimed it was “some burden”. It is also worth noting that while the OIG survey was conducted in 2019 prior to the pandemic, the Morning Consult poll was conducted in the midst of the pandemic and corresponding public health emergency, at a time when people generally sought less care and CMS encouraged plans to loosen their prior authorization requirements, which, taken together, might understate the roll that prior authorization normally plays in creating access to care barriers for MA enrollees.
In marked contrast to the insurance industry efforts to downplay OIG’s report, as discussed below, many providers and provider groups who actually provide care and services to MA enrollees have concurred with and pointed to the report’s findings as a notice to policymakers that something must be done in response.
The Center for Medicare Advocacy regularly hears from providers, ranging from physicians to skilled nursing facilities to home health agencies who provide care to MA enrollees, and who disagree with MA plans’ denials and premature terminations of coverage and care. While some providers are publicly vocal in their frustrations with MA plans’ denial practices, most providers with whom we speak are reluctant to fight the plans and publicly air their grievances out of concern about threatening ongoing business from the plans and existing contractual obligations.
As summarized in a New York Times article titled “Medicare Advantage Plans Often Deny Needed Care, Federal Report Finds” by Reed Abelson (April 28, 2022), the OIG report the investigator’s findings that “[t]ens of millions of denials are issued each year for both authorization and reimbursements, and audits of the private insurers show evidence of ‘widespread and persistent problems related to inappropriate denials of services and payment.’” The article notes that the 2022 report “echoes similar findings by the office in 2018 showing that private plans were reversing about three-quarters of their denials on appeal. Hospitals and doctors have long complained about the insurance company tactics, and Congress is considering legislation aimed at addressing some of these concerns.”
The Times article links to a December 2020 American Hospital Association (AHA) report titled “Addressing Commercial Health Plan Abuses to Ensure Fair Coverage for Patients and Providers” which states that coverage through private plans:
is eroding as some health insurers restrict access to health care services by abusing utilization management programs and changing health plan rules in the middle of a contract year […] some plans are now applying prior authorization to a wide range of services, including those for which the treatment protocol has remained the same for decades and there is no evidence of abuse.
In response to the 2022 OIG report, AHA issued a statement claiming that the report’s findings:
confirm — and provide data and real-life examples — of the harm that certain commercial insurer policies have on patients and the providers that care for them. The AHA continues to push back forcefully against MA plan policies that restrict or delay patient access to care, and add cost and burden to the health care system, while also contributing to health care worker burnout. We’ll continue to make the case that these commercial health plan abuses must be addressed to protect patients’ health and ensure that medical professionals — not the insurance industry — are making the key clinical decisions in patient care.
The American Medical Association (AMA) issued a press release stating that the OIG report’s findings “mirrors physician experiences.” The statement continues:
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 agrees with the federal investigators’ recommendations for preventing inappropriate use of authorization controls to delay, deny and disrupt patient care, but more needs to be done to reform prior authorization.
Similarly, a statement by the California Medical Association cites a 2021 survey by the AMA wherein “34% of physicians reported that prior authorization led to a serious adverse event for a patient in their care such as hospitalization, medical intervention to prevent permanent impairment, or even disability or death. Moreover, physicians and their staff spend nearly two days per week on prior authorizations creating costly administrative burdens.”
As reported in an Inside Health Policy article titled “Providers Want Reforms After OIG Finds MA Prior Auth Denials; Plans Say Most Requests Approved” by Michelle M. Stein (April 28, 2022), the American Medical Rehabilitation Providers Association (AMPRA) “says the findings back up its survey that found in August 2021, for those seeking admission to an inpatient rehabilitation facility, ‘MA plans overruled more than 50% all physician recommendations, and hospitalized patients waited on average more than two and a half days for decisions from plans.’” (The AMPRA survey can be found here.) The same article quotes Dave Adler, the vice president of advocacy at the American Society for Radiation Oncology’s (ASTRO), who “also says the report boosts the legislation’s prospects. ‘The report confirms how prior authorization has become a tool to keep patients from the care they need. It’s out of control and needs to be reined in before more patients suffer.’”
Further, while some provider associations may not have issued public statements commenting on the OIG report, some trade publications express general discontent among certain types of providers about the issues raised by the report. For example, a McKnights Long-Term Care News article about the report stated that “[s]killed nursing providers are demanding changes after a new federal report found that Medicare Advantage organizations (MAOs) have improperly denied or delayed services to beneficiaries to increase profits.” The article quotes an administrator of a veterans home in Boise who stated that “‘Every time we have a resident referral who has an MA plan, we know we are in for a fight […] There has never been an easy admission of a resident who has MA.’”
Similarly, a McKnights Home Care article notes that “not everyone, including large home health firms, are happy with how MA plans are spending the government funds. During a conference call with analysts Thursday, Encompass Health executives said the plans aren’t adequately compensating them for home health services.” Home Health Care News posted an article noting that the OIG report’s finding that 18% of payment requests denied met Medicare coverage rules “[g]enerally […] falls in line with the vocal criticism MA plans have received from home-based care providers when it comes to reimbursement.”
May 5, 2022 – D. Lipschutz