OIG finds widespread inappropriate care denials in Medicare Advantage

A new HHS Office of the Inspector General report (OIG) highlights serious problems with  denials of care and coverage in Medicare Advantage. As the OIG found in 2018, tens of thousands of people in Medicare Advantage are not receiving the care they need, to the detriment of their health and well-being. The OIG urges the Centers for Medicare and Medicaid Services (CMS) to conduct better oversight of these health plans and alert people to serious Medicare Advantage violations. Last time round, CMS did not heed the OIG’s call. Will it do so this time round?

People with costly and complex conditions are at particular risk of going without needed care in Medicare Advantage. If their incomes are limited incomes, they are generally at the mercy of their Medicare Advantage plans to cover their care. You are playing Russian Roulette when choosing a Medicare Advantage plan since there’s no way to know in advance whether your plan will pay for the care you need.

Better oversight and warnings about Medicare Advantage are critical, but they are not nearly enough. Most people are locked into Medicare Advantage after they initially enroll. They are hard-pressed to switch to traditional Medicare because they need supplemental coverage to fill its coverage caps, which is often hard to come by. Insurers are only required to offer supplemental coverage when people are first eligible for Medicare, when they have been in a Medicare Advantage plan for no more than 12 months, and in other very limited circumstances.

One key concern with Medicare Advantage plans, highlighted by the OIG, is that they are paid a flat fee each month, regardless of the amount they spend on care, creating a powerful incentive for them to deny care in order to maximize profits. Unsurprisingly, every year CMS finds “widespread and persistent problems related to inappropriate denials of services and payment.”

The OIG found that nearly one in seven (13 percent) Medicare Advantage prior authorization denials were inappropriate. Medicare Advantage plans frequently denied requests for care that met Medicare coverage rules. Consequently, enrollees often could not get the medically necessary care their doctors prescribed, or their access to care was delayed.

Prior authorization requirements create administrative barriers to care for people enrolled in Medicare Advantage. Inappropriate denials can result in enrollees having to pay for care that Medicare should be covering. Worse still, inappropriate denials can jeopardize the health and well-being of enrollees. But, the government won’t let you know if you’re enrolled in a Medicare Advantage plan that routinely wrongly denies you needed care, much less warn you against enrolling in Medicare Advantage plans that routinely wrongly deny care.