Over the past several years, it’s been hard to miss the famous faces from the 1960s and ’70s who are now in their 70s or 80s endorsing Medicare Advantage plans to America’s seniors. These celebrities—whether they are renowned former football player Joe Namath or actors known for their roles on prime-time TV (like Jimmy Walker and William Devane)—are promoting the additional benefits of MA health plans over traditional Medicare, all at no extra cost. Who wouldn’t be tempted by such an offer?
These perks can range from meal delivery to gym memberships, even sometimes adding money to people’s Social Security checks. It’s all part of health insurers’ efforts to entice seniors into choosing MA plans. But the reality often falls short for beneficiaries.
The problem with insufficient benefit transparency goes beyond these superficial offers. Right now, patients often have no sure way of knowing whether their treatment will be covered or denied. One way to help beneficiaries is to start shedding light on the prior authorization process to ensure they truly understand what they’re signing up for when they enroll in MA plans.
Under the current prior authorization model, a doctor who prescribes some courses of treatment must first submit paperwork to an insurance company and wait for permission to proceed. This can lead to delays or even denials of care, jeopardizing the patient’s health. Paying out of pocket for what a patient believed was covered by the health plan can put them in financial jeopardy. Doctors and hospitals also operate at the mercy of the health plan and can be denied reimbursement for medically necessary services they provide in good faith.
Confusion about Medicare Advantage coverage has garnered attention from the Medicare Payment Advisory Commission, members of Congress, the Centers for Medicare and Medicaid Services and the Health and Human Services Department Office of the Inspector General. In fact, the OIG found that 13% of prior authorization denials by MA plans would have been covered by traditional fee-for-service Medicare, affecting millions of unsuspecting patients each year.
The prior authorization process usually involves four key, mostly opaque, steps:
1. The provider submits a request for prior authorization of a service, medication or medical supply to the health plan.
2. The plan reviews the request and decides whether to approve, partially approve or deny it.
3. If the request is partially approved or denied, the provider or patient can appeal, with the initial decision reviewed by the plan itself.
4. If the original denial is upheld, the patient or provider can appeal to an Independent Review Entity.
Here’s the problem for beneficiaries who want to make an informed plan choice: Much of this information often isn’t known until after the fourth step, leaving patients uncertain about whether their plan truly covers the care they need. Insurers have been able to hide their behavior in the early steps of the process, exploiting this lack of transparency regarding the initial delay or denial of care.
CMS-published data examined by Federation of American Hospitals staff reveal that MA plans overturn their initial denials about 80% of the time—this after forcing a patient to enter the paperwork-approval gauntlet. Shouldn’t a senior know this before choosing a plan?
To provide seniors with more honest and actionable information on the actual benefits of their MA plan, the Federation has submitted to CMS a quality measure concept that would look at the percentage of times a plan upheld its own initial denial. While these denials may ultimately be overturned, treatment is often delayed, leaving patients in a medical holding pattern for days, weeks or even months. During this time, many patients are forced to seek alternative treatment, pay out of pocket or go without care. This could not be what the congressional framers of the modern MA marketplace had in mind. It must be fixed.
Although CMS has proposed a rule to expedite the prior authorization timeline, our proposed measure would add a necessary element of transparency by publicly reporting how often denials are upheld after the first appeal. This will help seniors understand how an MA plan will likely respond when they need treatment. We believe that this greater transparency will lead to more accountability for insurance companies, compelling them to ensure the correct decision is made the first time instead of burdening patients and healthcare providers with a protracted appeal process.
With about half of eligible Medicare beneficiaries now choosing MA plans, improved transparency and oversight are crucial. Seniors deserve actionable information about their coverage before enrollment so that they aren’t left waiting for care amid a medical crisis. This is far more valuable than any celebrity endorsement.