Whatley Kallas’s provider clients have been increasingly frustrated with Medicare Advantage plans’ inappropriate denials and reduced payment of claims and with the plans’ use of prior authorization to delay and deny care and we have been pursuing clams based upon those denials and reductions. Congress and the Centers for Medicare & Medicaid Services have also raised concerns with the Medicare Advantage plans’ payment practices, focusing on prior authorization before treatment and their use of artificial intelligence to adjudicate claims. As a result, CMS asked for comments on how the program could be more transparent, with a focus on data and increasing competition.
In response to CMS’s request, the American Hospital Association, the American Medical Association, and the Medical Group Management Association have all urged CMS to enact additional transparency requirements and provided CMS with specific recommendations.
In a 42-page letter to CMS, the AHA urged CMS to enact additional transparency requirements and to increase enforcement of existing rules. In support of its recommendations, the AHA stated:
Indeed, as enrollment in the MA program has for the first time reached more than half of all people enrolled in Medicare, it is more important than ever to establish and implement stronger data-driven oversight capabilities. Timely and accurate information on MA plan performance and compliance with existing CMS regulations is critical to ensuring that those enrolled in MA plans are not unfairly subjected to more restrictive rules and requirements than Traditional Medicare, which are contrary to the intent of the MA program and run afoul of federal rules.
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…[T]he AHA continues to urge CMS to increase enforcement of existing MA regulations to protect Medicare beneficiaries from inappropriate delays and denials of Medicare-covered services.
(emphasis in the original)
Among the AHA’s specific recommendations were asking CMS to enact:
- A formal, streamlined pathway for providers to report suspected violations of federal rules to CMS
- Sanctions on MA plans that do not comply with federal rules after receipt of warning letters
- Routine auditing of MA performance, including of the plans’ medical necessity criteria
- Greater scrutiny of MA plans’ adherence to the Two-Midnight benchmark for inpatient admissions
- A reduction in the time for responding to prior authorization requests to within 72 hours for standard, non-urgent services and 24 hours for urgent services
- Establish clear and transparent standards for the use of AI to auto-deny claims, and for disclosure of such policies to patients, providers and the public
In a lengthy letter, the AMA likewise set forth specific recommendations, including urging CMS to:
- Establish a formal oversight and audit process requiring MA plans to submit documentation regarding clinical criteria
- Require MA plans to report detailed data on prior authorization requests, denials, and appeals
- Collect data on the duration of prior authorization approvals and enforce compliance with the new continuity of care requirements
- Require that MA plans include additional populations in their health equity analyses
- Implement rules to prevent payer abuse of AI to adjudicate claims
The AMA letter provided support for all of its recommendations. With respect to its recommendation that CMS require detailed reporting of prior authorization data, the AMA provided results from its most recent survey, which showed the negative impacts on patient care, significant provider burden, and increased costs of prior authorization. This survey showed that 94% of the physicians responding stated that prior authorization delays care, 89% reported that prior authorization has a negative impact on patient clinical outcomes, and that 33 % reported that prior authorization has led to a serious adverse event for a patient in their care.
The MGMA also focused on the negative impact of prior authorization on medical group practices, stating that “[p]rior authorization is routinely identified by medical groups as the most challenging regulatory burden to running a practice and delivering high-quality care.” The MGMA urged CMS to collect more granular data on the use of prior authorization by MA plans and to collect more robust information from MA plans about the application of value-based arrangements.
The AHA letter is linked here. The AMA letter is linked here. The MGMA letter is linked here.