Medicare Advantage plans use a series of policies that hurt Medicare beneficiaries, lead to physician burnout and bring up healthcare costs, the American Hospital Association (AHA) argued in a recent report. To combat these issues, AHA is calling for legislative action.
Specifically, AHA argues that some MA plans have stricter medical necessity criteria than traditional Medicare plans, use “excessive” prior authorization requirements, use unnecessary utilization management tools and require repetitive clinical documentation submissions for services.
“These practices result in delays in care and can cause direct patient harm,” AHA declared. “In addition, they add financial burden and strain onto the health care system, requiring increased staffing and technology costs to comply with plan requirements, while also contributing significantly to healthcare worker burnout.”
AHA’s report comes after the U.S. House of Representatives passed the Improving Seniors’ Timely Access to Care Act last week. The bill would establish several requirements for the prior authorization process under MA plans. Prior authorization determines if a payer will cover a healthcare service.
While AHA supports the bill, it believes additional action is needed by the government. In the report, it specifically calls on Congress to:
- Create penalties on MA plans when prior authorization processes delay care
- Increase oversight by the Centers for Medicare and Medicaid Services (CMS). This includes more plan reporting on coverage denials, appeals and grievances; making plan performance data publicly available; and providing targeted audits based on plan performance.
- Establish a process for providers to submit complaints to CMS
- Make medical necessity criteria equal between MA and traditional Medicare plans
- Expand network adequacy requirements for certain post-acute care sites. Network adequacy refers to having a large enough network of providers in a health plan so patients can have reasonable access to care.
“Congressional action is needed to specifically prohibit MA plans from using medical necessity criteria that is more restrictive than the criteria used for patients enrolled in traditional Medicare,” AHA said in the report. “This effectively results in patients being denied medically necessary care that should be covered and creates inequities in access to care between those enrolled in MA plans versus traditional Medicare.”
In response to the AHA report, America’s Health Insurance Plans (AHIP), an advocacy organization for payers, shot back that some of these practices are needed to avoid unnecessary care and reduce costs. A 2019 JAMA study found that the estimated cost of waste in the U.S. healthcare system ranges from to $760 billion to $935 billion, which equates to about 25% of all healthcare spending.
“Health insurance providers advocate for the people they serve by ensuring that the right care is delivered at the right time in the right setting — and covered at a cost that patients can afford. Prior authorization prevents waste and improves affordability for patients, consumers, and employers,” Kristine Grow, AHIP spokesperson, wrote in an email. “Health insurance providers have a comprehensive view of the health care system and each patient’s medical claims history and work to ensure that medications or treatments prescribed by clinicians are safe, effective, and affordable for patients. This results in better outcomes and lower costs for patients.”
That doesn’t mean some practices can’t be improved, though. To streamline the prior authorization process, Grow recommends adopting electronic prior authorization. In 2020, AHIP launched the Fast Prior Authorization Technology Highway initiative to determine the effectiveness of electronic prior authorization. It found that 71% of providers who adopted the electronic process for most or all of their patients reported that patients received faster care.
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