Earlier this year, the Department of Health and Human Services Office of Inspector General (HHS OIG) issued a report focused on Medicare Advantage (MA) organization denials of prior authorization requests. HHS OIG found that MA organizations sometimes delay, or outright deny, beneficiary access to services that do meet Medicare coverage requirements.
In conducting the research, HHS OIG analyzed a stratified, random sample of 250 prior authorization denials and 250 payment denials that were issued by 15 of the largest MA insurers from June 1, 2019 through June 7, 2019. Health care coding experts reviewed case files for all cases, and physician reviewers examined medical records for a subset of cases. From these results, HHS OIG estimated the rates at which MAOs denied prior authorization and payment requests that met Medicare coverage rules and MAO billing rules. We also examined the reasons for these denials and the types of services associated with these denials in our sample. The analysts used those figures to extrapolate likely denial rates that fit within Medicare’s requirements.
Overall, HHS OIG found that 13% of prior authorization denials fit within Medicare coverage requirements and 18% of denied payment requests fit within those coverage requirements. The report also found that MA Plans did reverse some of the denials that fit within the Medicare coverage guidelines, most often when a patient or provider disputed the denial, but also when the insurer identified its own error.
There were two common causes of the improper denials: (1) MA organizations using clinical criteria that are not contained in the Medicare coverage rules and (2) MA organizations indicated that there was not enough documentation to support approval, but reviewers found that the beneficiary medical records in the file were sufficient to support medical necessity.
“Our findings about the circumstances under which MAOs denied requests that met Medicare coverage rules and MAO billing rules provide an opportunity for improvement to ensure that Medicare Advantage beneficiaries have timely access to all necessary health care services, and that providers are paid appropriately,” HHS OIG said in the report.
Recommendations
As we often see at the conclusion of these reports, HHS OIG did make some recommendations to Centers for Medicare and Medicaid Services (CMS), including that the agency issue new guidance on appropriate clinical criteria in medical necessity reviews, update audit protocols to address issues by HHS OIG (such as the MA organization use of clinical criteria and/or examining particular service types), and direct MA organizations to take steps to identify and address vulnerabilities that might lead to both manual review and system errors. CMS concurred with all three recommendations.
Outside Opinion
The American Medical Association (AMA) noted that OIG’s report “mirrors physician experiences” when it comes to MA plans, and that the Improving Seniors’ Timely Access to Care Act would help alleviate some of these problems.