Since 2018, the U.S. Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) has warned that Medicare Advantage (MA) plans sometimes deny enrollees’ requests for essential services they need.1 2
In response to these findings, the Centers for Medicare and Medicaid Services (CMS) finalized a 2024 rule to clarify “clinical criteria guidelines to ensure people with MA receive access to the same medically necessary care they would receive in traditional Medicare.”3 Unfortunately, providers report little improvement since the rule became effective in January. Inappropriate denials continue to cause poor outcomes for patients, hospital readmissions and increased waste of taxpayer dollars.
Inpatient Rehab Denials
The 2024 MA rule did not help U.S. Air Force veteran and Pearl River, LA resident George Carrigan. After complications from diabetes required an amputation of his leg, Humana denied his doctors’ recommendation for care at an inpatient rehabilitation facility (IRF), despite Medicare rules listing amputation as a condition requiring such services.4
Humana’s two denial letters said he did not need supervision from a rehab physician or interdisciplinary care team, even though these clinicians would have helped control his diabetes, monitored the healing of his wound, managed his medications, and prepared him to return home independently. “The services you need can be provided safely in other settings,” wrote Humana, before sending him to a less expensive setting where his condition deteriorated.
Carrigan’s daughter and family caregiver, Colleen Fickle, said her dad slipped in the nursing home’s shower and now needs wound care on the amputated limb. Poor catheter maintenance also caused him to be readmitted to the hospital with sepsis. Fickle, who works full time while also caring for her child with a brain injury, said her father is now bedbound at home and dependent on family. She believes none of these complications would have happened and that her father would be walking today if Humana had permitted him to receive close medical supervision at an IRF.5
Mandeville resident William Sercovich, also a U.S. Air Force veteran, suffered two strokes and faced multiple denials before Humana approved his request for IRF services. Both Humana denial letters repeated Medicare’s rehab criteria without explaining why Sercovich did not need a rehab doctor, intensive team or three hours of therapy per day.
“We were in the hospital for two weeks longer than we should have been because of denials from the insurance company,” said his daughter, Sondra Sercovich. “I hope people take action, so it doesn’t take so many denials to get the proper medical care.”
The OIG estimated a difference of more than $8,500 in average payments per stay between IRFs and nursing homes for 2018.6 OIG has also warned that MA plans may deny needed care “in an attempt to increase their profits,” misusing funds that CMS paid for people’s healthcare.7 In 2022, OIG physicians audited MA care denials for IRF services and found that in some cases patients met admission criteria, needed higher-level care and alternatives were insufficient to meet their needs.8 Studies have found that MA enrollees “are more likely to enter lower-quality nursing homes compared to fee-for-service enrollees.”9
When used appropriately, prior authorization can limit low-value services, but healthcare providers also caution that “cost containment provisions that do not have proper medical justification can put patient outcomes in jeopardy.”10
A recent Kaiser Family Foundation (KFF) study comparing MA plans found that “prior authorization requests were most common for Humana plans.”11 Humana did not respond to requests for comments on its prior authorization practices under new federal rules.
This year, CMS warned MA plans they may not deny a hospital patient’s request for discharge to an IRF or redirect care to a different setting if a physician orders these services and the patient qualifies under Medicare coverage rules.12 Yet, plans have significant leeway in how they interpret this directive, and families often lack the time to appeal when the patient is ready to leave the hospital.
Fickle said her father needed intensive therapy at Northshore Rehabilitation Hospital in Lacombe, LA. Speaking of the value of IRF care, the hospital’s CEO Laurel Dupont said “one single hospital readmission would cost [MA plans] as much if not more than the entire rehab stay. Northshore Rehab had zero readmissions of an amputee patient during all of 2023.” A study by Dobson DaVanzo & Associates comparing IRF and skilled nursing facility patients found that IRF patients returned home earlier and remained there longer, with lower mortality rates, emergency room visits and hospital readmissions.13
Several providers report concerning automatic denials for IRF services. In recent months, TIRR Memorial Hermann Health System in Houston reported receiving automatic MA denials for 90% of prior authorization requests. “If they give us a denial, they’ll say you can go to [a peer-to-peer call with our physician] or you can go ahead and discharge to a nursing home, and I’ll give you that approval now,” said financial clearance manager Courtney Roberson, adding that these automatic denials often keep a patient in the hospital for four to five days longer, taking weekends into account.
Patients also stay in the hospital longer because MA plans are not required to include IRFs in their provider networks, even though IRF services are a Medicare covered benefit. “It’s not right for Medicare beneficiaries to not have access to this level of care,” said TIRR Memorial Hermann CEO Rhonda M. Abbott. “It doesn’t make sense to eliminate a whole level of care.”
Last year during a congressional hearing, the American Hospital Association (AHA) described how MA plans financially benefit from these post-acute care delays, explaining that “the plan has already paid the hospital a flat rate for care and is either delaying or attempting to avoid discharging the patient to the next site of care, which would require a separate, additional reimbursement. AHA claims data analysis reflects that length of stay in the referring hospital is typically longer for MA beneficiaries than traditional Medicare beneficiaries being discharged to a post-acute setting.”14
These transfer delays also contribute to the overcrowding of emergency departments. “An example is a patient who is on a regular floor bed who needs to go to post-acute care,” said Baton Rouge emergency physician Dr. John Jones. “I need that bed for my next congestive heart failure patient who’s in the emergency department, and I can’t put them in there because it’s being occupied by somebody who’s waiting three days over the weekend to get placed.”
Cardiology and Cancer Care
MA plans also deny care for patients who need high-quality, Medicare-covered cardiology and cancer care services.
Cardiologist Dr. Joe Deumite, in Baton Rouge, offered two examples. In one case, Humana twice denied care to a man who needed a pacemaker. “He had 73 episodes where his heart paused for more than three seconds and several episodes where his heart paused for up to 5.2 seconds,” he said, adding that the care was finally approved by an independent review entity.
In another instance, Dr. Deumite said a woman who suffers from irregular heart rhythms has had to go to the emergency room and take medications because Humana denied her appeals to receive a cardiac ablation. “There are several heart rhythms that respond to ablation, where you just slide up a catheter and cauterize a circuit, and its curative.”
In April, Baton Rouge medical oncologist Dr. Gerald Miletello recorded a social media video testimonial where he described a dangerous care delay for one of his lung cancer patients.15 “A six-week delay is not following the guidelines because you can easily die with stage four cancer in six weeks,” he said.
Radiation oncologist Dr. William Russell, in Baton Rouge, said his patients have faced delays when they need to start concurrent chemotherapy with radiation. He also criticized MA plans’ requirement that he conduct a CT scan before they will approve a PET scan. “You have to do diagnostic tests that are not going to be as relevant as the one that you wanted,” he said. “It costs the payers more money to go through that process.” The 2024 MA rule prohibits this practice of step therapy for non-drug services.
Medical oncologist Dr. Michael Castine, in Baton Rouge, said MA plan documentation requests require him to factor in 10 days between planning and implementation of a patient’s cancer treatment. He mentioned risks for patients with small cell lung cancer, aggressive lymphomas or risks of brain metastasis, warning that “a delay of treatment by a week or two might actually change the whole plan.”
Peer to Peer Frustrations
Physicians also criticized the quality of communication they received from MA plan physicians when they call to appeal a patient-care denial.
“They’re making it up as they go along,” said physical medicine and rehabilitation physician Dr. Adam Carter, who serves as medical director of ClearSky Health Rehabilitation Hospital in Flower Mound, Texas. “I see them as constrained by their employer.”
“You can almost tell by the first 10 seconds into your conversation whether it’s going to work or not, because you can tell whether that physician is reasonable,” said Dr. Deumite. “They’re looking at year-and-a-half old guidelines.”
Policy Solutions for Improving Medicare Advantage
Federal leaders have designed a broad range of solutions to help hold MA plans more accountable. Some changes will not begin until 2026, and stakeholders want additional timeliness and transparency requirements for meaningful patient-care improvements.
Timeliness
Today, MA plans must make a prior authorization decision within 14 business days for standard requests and 72 hours for expedited or emergency requests. In 2026, the deadline for standard requests will become seven business days. Stakeholders have called for a 24-hour deadline for emergency requests; pending federal legislation would suggest, but not require, CMS to institute such an expedited timeline.16 17
Reporting
In 2026, MA plans must begin publicly reporting aggregate contract-level prior authorization metrics, including denial rates and timeliness. Much of this information already exists today. According to KFF, MA plans denied 3.4 million prior authorization requests in 2022. Only one in ten denials were appealed, but more than 8 out of 10 appeals resulted in overturning the denial. With limited data, it’s not possible to determine the initial reasons for these improper care delays. A study by Premier found that MA denials are more common for higher cost treatments, and that hospitals’ average administrative cost to fight these denials is nearly $20 billion a year.18
Federal leaders, including Louisiana’s U.S. Sen. Bill Cassidy, and multiple provider groups have asked CMS to require MA companies to report more specific and meaningful data.19 20 KFF researchers found that “substantial data gaps remain that limit the ability of policymakers and researchers to conduct oversight and assess the program’s performance, and for Medicare beneficiaries to compare Medicare Advantage plans offered in their area.”21 KFF also found that “without plan-level data, by type of service, it will not be possible to determine whether plans are complying” with the 2024 MA rule.
KFF also reported that MA companies “do not report the reasons for prior authorization denials to CMS. If most denials of prior authorization requests are because the service was not deemed medically necessary, efforts to increase transparency of the coverage criteria, such as those recently included in a final rule, may be more likely to have an impact.” KFF has also pointed to a lack of transparency related to decisions from the independent review entity that considers appeals after an MA physician denies a request.22
CMS opted against requiring plan-level data in 2026, saying it did not want to overwhelm consumers and that it wanted to “limit plan burden.”23 The agency will consider more detailed reporting requirements during future rulemaking.
Internal MA Plan Monitoring
CMS now requires all MA plans to establish a Utilization Management Committee to review prior authorization policies annually and ensure compliance with traditional Medicare’s national and local coverage guidelines.24 The AHA urged the Medicare Payment Advisory Commission to monitor whether these committees will have authority to overturn harmful policies, writing that “many providers fear that these committees will serve as little more than a rubber stamp for plan policies.”25
During the public comment period on the 2024 MA final rule, health insurance companies argued that forcing them to follow traditional Medicare’s clinical criteria would lead to “fewer affordable, high-quality plan choices for beneficiaries” and “adverse health impacts.”
“CMS in the rule does give MA plans certain limited sets of circumstances where they can use their own internal coverage criteria when traditional Medicare criteria is not fully established,” said Michelle Millerick, AHA director for health insurance coverage and policy. “Some MA plans are over-extending that limited flexibility, and there’s not necessarily a clear definition of exactly when Medicare criteria is fully established, especially for level of care determinations. Stronger enforcement of these provisions from the 2024 MA final rule is needed to ensure plans do not continue to use more restrictive criteria than Medicare.”
Denial Letter Language
Beginning in 2026, CMS said the prior authorization denial letters must be “sufficiently specific to enable a provider to understand why a prior authorization has been denied and what actions must be taken to resubmit or appeal.” The agency said the MA plans’ reason for denial “could include” a variety of explanations, such as “how documentation did not support a plan of care for the therapy or service” or “specifically, why the service is not deemed necessary.” Experts say they are cautiously optimistic, but that it remains to be seen how effectively CMS will enforce this policy for patients like Carrigan and Sercovich.
Targeted Auditing/Aggressive Enforcement
This year, CMS said it will conduct routine and focused audits to assess compliance with the 2024 MA rule. In a statement, the agency said that it “may issue compliance and enforcement actions, including civil monetary penalties to MA organizations who fail to comply with our regulations.” Providers may send complaints with specific examples of MA plans’ noncompliance to [email protected].
The OIG recently announced plans to audit MA IRF denials and will issue a report in 2026.26 “I can tell you with great certainty that you will see us expanding our oversight of Medicare Advantage in the coming months and years,” said HHS Inspector General Christi A. Grimm during a recent speech to MA company leaders. “We want Medicare Advantage to be successful. OIG’s work helps ensure that the program works as intended for Medicare enrollees and for taxpayers.”27
In a statement for this article, OIG said providers may email specific concerns to the agency at [email protected]. “Input from health care providers about managed care practices are regularly sent to relevant subject matter experts, including in our agency’s leadership, for their awareness and to inform our work,” wrote OIG.
Last year, the federal government paid MA plans more than $454 billion to provide high-quality care to more than 30 million people.28 KFF reports that nearly 60 percent of Louisiana’s Medicare beneficiaries are enrolled in an MA plan this year.29 Providers have applauded the OIG for exposing dangerous care denials and for calling on MA corporate leaders to provide better value to patients and taxpayers.30 “The Medicare Advantage plans aren’t going to change until their board of directors at the company understands as a matter of corporate policy that this isn’t the way to go,” said Dr. Carter.
[1] https://oig.hhs.gov/oei/reports/oei-09-16-00410.asp
[3] https://www.cms.gov/newsroom/fact-sheets/2024-medicare-advantage-and-part-d-final-rule-cms-4201-f
[5] https://www.facebook.com/LAHospitals/videos/252495247935007
[6] https://oig.hhs.gov/documents/evaluation/3150/OEI-09-18-00260-Complete%20Report.pdf
[7] https://oig.hhs.gov/oei/reports/oei-09-16-00410.pdf
[8] https://oig.hhs.gov/documents/evaluation/3150/OEI-09-18-00260-Complete%20Report.pdf
[9] https://pubmed.ncbi.nlm.nih.gov/29309215/
[10] https://www.ama-assn.org/system/files/principles-with-signatory-page-for-slsc.pdf
[15] https://www.facebook.com/LAHospitals/videos/1156382158614094
[16] https://www.congress.gov/bill/118th-congress/senate-bill/4532/text
[17] https://amrpa.org/Portals/0/AMRPA%20Comments%20on%20MA%20Data%20RFI%20May%202024_Final.pdf
[23] https://www.govinfo.gov/content/pkg/FR-2024-02-08/pdf/2024-00895.pdf
[24] https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-B/part-422/subpart-C/section-422.137
[26] https://oig.hhs.gov/reports-and-publications/workplan/summary/wp-summary-0000873.asp
[27] https://oig.hhs.gov/documents/speeches/1106/IG-Grimm-RISE-transcript.pdf
[28] https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2024-enrollment-update-and-key-trends
[30] https://youtu.be/fDzAb-6aog8?si=KIuiXj23d2yr8eoP
