According to a recent article in Fierce Healthcare, in late May the American Hospital Association (AHA) published a letter to the Department of Justice (DOJ) pleading for an investigation “into commercial payers that routinely deny access to care and services.”
Hmm . . . who could they be talking about?
Here at Un-covered, we can think of a few examples.
- Remember when Cigna wouldn’t pay for children’s COVID-19 tests? The Centers for Medicare & Medicaid Services (CMS) had to get involved on that one.
- Or when UnitedHealthcare (United) wouldn’t cover post-cancer surgery ? The lawsuit alleged that the insurer violated the Employee Retirement Income Security Act (ERISA).
- And lest we forget BlueCross BlueShield of North Carolina (BCBSNC), who blamed computer glitches on their refusal to cover children’s speech therapy.
According to the letter, “This problem has grown so large — and has lasted for so long — that only the prospect of civil and criminal penalties can adequately prevent the widespread fraud certain [Medicare Advantage organizations] are perpetrating against sick and elderly patients across the country.”
But just how large of a problem is this?
The letter refers to an investigation that the Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) conducted in April. In a random sample of 250 prior authorization denials from 15 major insurers, authorities “found that only 13% of the denials followed Medicare coverage requirements and so did only 18% of the payment denials.”
Health insurers say they use prior authorizations “for curbing unnecessary treatments.” But the necessity of prior authorization is a source of debate, because most patients don’t go to the doctor just for kicks and giggles. Let’s be realistic: who enjoys going to the doctor? It’s inconvenient, it’s costly, and it’s time-consuming. But we go because it’s medically necessary.
According to a 2021 American Medical Association (AMA) survey, approximately 30% of physicians reported that the criteria used to gauge prior authorizations are “rarely or never evidence-based.” And for patients whose treatment required a prior authorization, nearly 93% of providers claimed that prior authorizations delay access to necessary care. In addition, 82% reported that prior authorizations can sometimes lead to treatment abandonment…meaning their patients don’t get the care they need.
Need we remind you—the patients the AHA is pleading on behalf of are elderly and/or disadvantaged adults in need of care.
Meanwhile, health insurers continue to defend their use of prior authorizations. They claim the problematic system is “a necessary cost management tool.”
Oh, okay, “necessary cost management.” That might make sense . . . if insurers were struggling to pay their bills. Now, they do seem to have issues paying their bills from a logistics standpoint, it’s not for lack of profit:
- UnitedHealth Group ended the year with $17.3 billion in total profit
- Anthem’s annual net income for 2021 was $6.10 billion.
- Cigna made $5.4 billion net income in 2021.
- Aetna made $7.9 billion in profit.
So, maybe those prior authorizations aren’t so much a cost saver for insurers as much as they’re a profit driver.
And given the recent evidence that they do harm patients, rather than ensure they get the care they need, we’re not so sure these insurers really care about the patients they claim to cover.