The federal government pays private insurers a fixed amount per Medicare Advantage patient. If the patient’s choice of hospital or doctor is limited, and if he or she is encouraged to get services that are less expensive but effective, then the insurer stands to profit.
Under traditional Medicare, there may be an incentive for hospitals and doctors to overtreat patients because they are paid for each service and test performed. But the fixed payment given to private plans provides “the potential incentive for insurers to deny access to services and payment in an attempt to increase their profits,” the report concluded.
Dr. Jack Resneck Jr., the president-elect of the American Medical Association, said the plans’ denials had become widespread. The organization has been aggressively lobbying lawmakers to impose stricter rules.
Prior authorization, intended to limit very expensive or unproven treatments, has “spread way beyond its original purpose,” Dr. Resneck said. When patients cannot get approval for a new prescription, many do not fill it and never tell the doctor, he added.
Appeals end up unfairly burdening patients and often take precious time, some doctors said.
“We are able to reverse this some of the time,” said Dr. Kashyap Patel, a cancer specialist who serves as chief executive of Carolina Blood and Cancer Care and president of the Community Oncology Alliance. But his efforts to “fight like a hawk” to get approvals for the care he recommends also leave him less time to tend to patients, he added.
The most frequent denials found by the investigators included those for imaging services like M.R.I.s and CT scans. In one case, an Advantage plan refused to approve a follow-up M.R.I. to determine whether a lesion was malignant after it was identified through an earlier CT scan because the lesion was too small. The plan reversed its decision after an appeal.
In another case, a patient had to wait five weeks before authorization to get a CT scan to assess her endometrial cancer and to determine a course of treatment. Such delayed care can negatively affect a patient’s health, the report noted.