The Senate Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations conducted a hearing on Wednesday to learn how and why Medicare Advantage (MA) plans have routinely denied care of covered services.
The two-hour hearing exposed the growing problem of prior authorization requirements and how artificial intelligence (AI) might be the culprit behind many of the care denials and delays. Indeed, committee chair Richard Blumenthal (D-Conn.) opened the hearing, noting the troubling evidence that insurance companies are relying on algorithms to make decisions to deny patient care.
Blumenthal said he generally supports MA programs and the flexibility the plans provide to seniors but pointed out that some of the bigger insurers are failing their members when they need treatment and care. Some families face denials in the middle of major medical crises and the fight for insurance coverage detracts from the fight for their health. But most troubling, he said, is the growing evidence of the reliance on AI and algorithms rather than the treating physician to determine whether treatment or services are covered.
“These decisions are not being made by doctors or other trained professionals at all,” he said. “Instead, companies are using algorithm that have been programmed to predict how much care a patient needs without ever meeting a patient or their doctor.”
While insurers may refer to these tools as guidance, Blumenthal said the denials generated are too systematic to ignore. “All too often AI and algorithm have become a blanket mechanism for denial”, he said, calling for insurers to make the AI mechanisms they use more transparent so patients, providers, and the public know how they are being used.
MA continues to grow in popularity and the private plans now provide Medicare coverage for 30 million seniors, more than half of eligible beneficiaries. But Blumenthal said that the major insurance companies who run the plans are making record profits in part because of the denials or delays in care. He warned insurers that lawmakers won’t allow this practice to continue.
Bipartisan lawmakers have sent letters to MA’s biggest insurers—UnitedHealth, Humana and CVS Aetna, which collectively cover 50 percent of MA beneficiaries—asking for internal documents that show how decisions are made to grant or deny access to care, including how they use AI.
“If you deny lifesaving coverage for seniors, we are watching. We will expose you. We will demand better. We will pass legislation, if necessary, but action will be forthcoming,” Blumenthal said.
OIG Chief of Staff Megan Tinker, chief of staff, provided testimony that the OIG has found that MA organizations have denied coverage to services that would have been approved had the members been enrolled in Medicare. In some cases, MA plans have denied payments to providers for services already delivered to patients even though the requests met Medicare coverage rules and the plans’ own billing rules. She pointed to an April 2022 investigation that found in 2021, MA organizations denied 2.2 million prior authorization requests and more than 56 million payment requests overall. Thirteen percent of the prior authorization denials were for services that met Medicare coverage rules. “Plans make more money by providing fewer services,” she told the committee.
Jeannie Fuglesten Biniek, Ph.D., associate director, Program on Medicare Policy, Kaiser Family Foundation, said in her testimony that in 2021, more than 35 million prior authorization requests were submitted to MA plans. Six percent (two million) of those requests were denied. Only 11 percent of the denials were appealed, yet when they were appealed, 82 percent were overturned either fully or partially.
Each prior authorization request requires providers to allocate time and staff resources that could instead be used for patient care. These requirements can also be a burden on beneficiaries who are already navigating a complex health care system, she said, and lead to delays in care even if the prior authorization request is ultimately approved.