UnitedHealthcare will ease prior authorization requirements for its Medicare Advantage plans, UnitedHealth Group CEO Andrew Witty said Thursday.
In his first public remarks since the murder of UnitedHealthcare CEO Brian Thompson last month and the backlash against the insurance industry it provoked, Witty said the healthcare conglomerate is looking for ways to simplify and accelerate its prior authorization processes. He did not offer specifics.
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“We're eager to work with policy leaders to use standardization and technology to speed up turnaround times for approval of procedures and services for Medicare Advantage patients, and to materially reduce the overall number of prior authorizations used for certain MA services,” Witty said during a call with investor analysts to announce UnitedHealth Group's fourth-quarter and full-year earnings.
Insurance subsidiary UnitedHealthcare is "very close" to rolling out an initiative to streamline prior authorization requests, Witty said.
“We have incredible opportunities here to improve system performance, both from a care and the cost perspective,” Witty said. “I just want to emphasize the criticality of collaboration here to try and design something not just for one company but for all companies, not just for one patient but for all patients,” he said.
Since 2023, UnitedHealthcare, Cigna, several Blue Cross and Blue Shield insurers and others have promised to address provider complaints about the rise in prior authorization demands and denials. Similarly, Humana and CVS Health subsidiary Aetna plan to automate more precertification approvals. UnitedHealthcare also launched a “gold card” program in October to reduce the prior authorization requirements for some providers and procedures.
Providers have been unimpressed with the insurance sector's maneuvering, which also hasn't satisfied policymakers.
“While talking about forward progress on this issue is a positive step, it must be followed by substantive actions," American Medical Association President Dr. Bruce Scott said in a news release Friday. "Enough with promises that nibble around the edges of the problem and benefit few, if any. Our patients deserve broad and meaningful prior authorization reforms, and we urge health insurers to get on board with immediate actions.”
Congress considered bipartisan legislation last year to restrain prior authorizations, several states have enacted new laws and the Centers for Medicare and Medicaid Services proposed a rule in November designed to rein in prior authorizations that builds on other measures the agency took under President Joe Biden.
Prior authorization denials have been on the rise, according to an analysis of CMS data the healthcare research institution KFF published in August. In 2022, providers submitted 46 million prior authorization requests to Medicare Advantage plans, 24% more than in 2019, KFF reported. Insurers rejected 7.4% of prior authorization requests in 2022, up from 5.7% in 2019.
“The health system needs to function better,” Witty said. “It needs to be less confusing, less complex and less costly.”
Medicare Advantage market share leader UnitedHealthcare projects it will add 800,000 enrollees this year and now counts 7.8 million members, a 1.9% increase from a year ago, Robert Hunter, president of the insurer's Medicare business, said during the investor call. The annual enrollment period ended Dec. 7 and CMS is slated to announce the results next week.
UnitedHealth Group net earnings fell 34.1% to $15.2 billion in 2024 as revenues rose 7.7% to $400.3 billion. The company’s medical loss ratio, which measures the proportion of premiums spent on care, increased from 83.2% to 85.5%. UnitedHealth Group shares closed at $510.59 on the New York Stock Exchange on Thursday, down 6% from the prior day's closing price.