According to a government report released last week, healthcare companies offering Medicare Advantage plans inadequately denied services and payments at a rate that may seem alarming during a one-week trial period in 2019.
Companies, many of which are also key players in Ohio’s Medicaid system, improperly denied payment 18% of the time and incorrectly denied approval of certain medical procedures 13% of the time, according to the report of the Inspector General of the United States Department of Health. and Human Services said.
In response, an industry group representing insurance giants such as Aetna, UnitedHealth and Humana claimed that making health care mistakes one-sixth or one-eighth of the time is not so bad.
The Inspector General’s report “found that nearly nine out of 10 denials of prior authorization coverage were consistent with Medicare coverage rules and more than eight out of 10 denials of payment claims complied with the rules. Medicare Billing, “the Better Medicare Alliance said in a statement. In addition, (the Inspector General) found that Medicare Advantage plans approve “the vast majority of pre-authorization applications and provider payment applications.”
In conducting the test, the inspector general set out to determine whether the companies, some of which are among the largest in the country, were effectively denying coverage in violation of the rules established by the Medicare and Medicaid Service Centers. the CMS.
In traditional Medicare, older Americans pay premiums to the government, which covers most of the cost of inpatient and outpatient services. But since the 1970s, private plans working with Medicare have been available. Now known as Medicare Advantage, the government plans to pay a monthly fee per member to coordinate patient care by setting up provider networks and paying.
The idea was initially to give private companies an incentive to get savings through things like negotiating with suppliers to reduce their costs. But the Kaiser Family Foundation in 2019 reported that, “Over the past few decades, Medicare’s payment policy for plans has shifted from one that produced savings to one that focused more on expanding access to private plans. and offer additional benefits to those enrolled in private Medicare plans worldwide. ”
And beneficiaries are flooding Medicare Advantage plans. They have more than doubled, from 12 million in 2011 to 26 million in 2021, according to the Inspector General’s report last week.
As they have done, concerns have arisen about the practices of companies. In 2017, the Government Accountability Office found that Medicare Advantage plans overcharged the government by $ 16 billion a year earlier. And the control group of the Center for Public Integrity reported that federal officials have had persistent problems overseeing large insurers.
To check on businesses, the Inspector General of Health and Human Services selected the week of June 1-7, 2019, and randomly selected 500 denials from the 15 largest Medicare Advantage providers.
The denials fell into two categories. One had to do with “prior authorizations”: services that the plan must sign in advance. By denying prior authorization, the plan says it does not cover a paperwork.
The other 250 denials that the inspector general chose at random were denied payments to providers such as doctors.
Healthcare coding experts and doctors reviewed the denials and determined that 13% of the previous denied authorizations were incorrect.
“We have identified two common causes of these denials,” the inspector general’s report said. First, (Medicare Advantage companies) used clinical criteria that are not included in Medicare coverage rules (e.g., requiring an x-ray before approving more advanced imaging), which led them to deny requests for services that our medical reviewers determined were medically necessary. ”
The report recommends better federal guidance to avoid these problems in the future.
But the question remains whether companies are denying services and payments to grow their profits. In 2017, the U.S. Department of Justice joined a lawsuit against UnitedHealth alleging that its Medicare Advantage plan overcharged the government by $ 1 billion. The department dropped most of its claims after the federal judge dismissed parts of the lawsuit.
Some of the companies that the Inspector General found out on time in the Medicare Advantage investigation have big business and controversy in Ohio.
The subsidiaries of CVS Health and UnitedHealth, the fourth and fifth largest corporations in the country, managed Medicaid pharmacy benefits in 2017. A state investigation the following year found that they charged taxpayers $ 224 million more for medicines than in the pharmacies that dispensed them.
The state is also suing UnitedHealth’s drug broker for allegations that he defrauded the $ 16 million Workers’ Compensation Office.
And Centene, the eighth-largest Medicare Advantage provider, last year agreed to pay Ohio $ 88.3 million to settle fraud claims with the Ohio Medicaid Department and more than $ 1 billion to resolve similar claims with 21 more states.
Despite lawsuits and controversy, the Medicaid department last year selected all three companies to receive contracts worth more than $ 1 billion each.
Mary Beth Donahue, president and CEO of the Better Medicare Alliance, in a response to the inspectors general’s report, said her organization supports simplifying the prior authorization process.
“While this study represents only a small sample of Medicare Advantage recipients, and survey data show that less than half of Medicare Advantage recipients have ever experienced prior authorization, the Better Medicare Alliance has strongly supported efforts to streamline and simplify the pre-authorization process for patients and providers, “he said.
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