In the Center for Medicare Advocacy’s recent “Special Report: The Real Impact of Medicare Advantage for Beneficiaries and Medicare Funding” (July 18, 2024), we highlighted how the Medicare Advantage (MA) program is costing significantly more than what traditional Medicare spends on a given beneficiary, adding stress to Medicare’s finances. We also cited evidence showing that this extra spending does not translate to better health outcomes or more affordable care for those enrolled in MA plans.
In addition to mixed health outcomes and affordability issues, there are other trade-offs for Medicare beneficiaries when choosing an MA plan vs. remaining in traditional Medicare. Among the challenges posed by MA plans is insurance sponsors’ ability to restrict enrollees’ access to only certain providers, and the ability to subject care to prior authorization. The extensive use of prior authorization also poses a challenge for providers, leading to many choosing to no longer contract with MA plans.
As noted in a recent article published by Becker’s Hospital Review titled “15 health systems dropping Medicare Advantage plans | 2024” by Jakob Emerson (July 22, 2024), the publisher adds to its ongoing reporting of hospitals and health systems nationwide that dropped or plan to drop their Medicare Advantage contracts. Noting that “some hospitals and health systems are opting to end their contracts with MA plans over administrative challenges,” the article states that “[a]mong the most commonly cited reasons are excessive prior authorization denial rates and slow payments from insurers.”
A recent example was covered by the Minnesota Star Tribune in an article titled “HealthPartners leaving UnitedHealthcare’s Medicare Advantage network” by Christopher Snowbeck (July 23, 2024), which describes how HealthPartners, “one of the largest operators of hospitals and clinics in the Twin Cities,” is sending letters to roughly 30,000 Medicare beneficiaries informing them that “it will drop out of the network next year for UnitedHealthcare Medicare Advantage plans, claiming the nation’s largest health insurer has an excessively high rate of coverage denials and frequently delays payment for services used by seniors.”
A copy of HealthPartners’ letter was sent to the Center for Medicare Advocacy by an attorney in Minnesota. Under the heading “Why are we making this change?” the letter states:
Here’s one of the key reasons why. UnitedHealthcare delays and denies approval of payment for our patients’ Medicare Advantage claims at a rate unlike any other insurer in our market. At times, this denial rate has been up to 10 times higher than other insurers we work with. UnitedHealthcare’s practices create unnecessary waits and delays for you, and they interfere with our ability to provide you with timely and appropriate care [emphasis added].
July 25, 2024 – D. Lipschutz