Back in May 2023, the Democratic majority of the Senate Homeland Security Committee’s Investigative Subcommittee announced that they would launch an investigation and draft a report on Medicare Advantage coverage denials.

Yesterday, nearly a year and a half later, the report was released.

The report confirmed the Subcommittee’s suspicions that coverage denials by the three major Medicare Advantage insurers—United Healthcare, Humana, and CVS Aetna—have increased since 2020. This is particularly concerning given that Medicare Advantage plans now cover over half of all Medicare beneficiaries, making these denials a widespread issue affecting the 32.8 million seniors enrolled in Medicare Advantage plans.

One striking insight from the report showed that United Healthcare doubled the rate that it denies patient hospital stays between 2020 and 2022.

Humana’s denial rate for long-term acute care hospitals grew by 54% during the same period. Similarly, the number of post-acute care services CVS Aetna requested for prior authorization increased by 57.5%.

These findings suggest that major insurance companies may not be adequately covering post-acute care, as it is being denied at much higher rates than other forms of patient care. Since post-acute care includes long-term hospital stays, inpatient rehabilitation facilities, and skilled nursing homes, these care denials are disproportionately felt by older Americans enrolled in Medicare Advantage plans.

While it’s difficult to attribute the rise in coverage denials to a single cause, the report dedicated a section to the use of artificial intelligence (AI) algorithms in evaluating prior authorization requests. It suggested a possible link between the increasing reliance on AI and the significant rise in care denials.

To begin addressing the identified problems, the report asked CMS to begin collecting prior authorization information broken down by area of care, to ensure that older Americans are not disproportionately being impacted by coverage denials.

The report once again puts Medicare Advantage in the spotlight. While Medicare Advantage often boasts lower premiums than traditional Medicare, it has been criticized for higher rates of care denials, primarily due to network restrictions and prior authorization processes. Additionally, the program is oftentimes more expensive for the government than traditional Medicare, raising concerns about its impact on the long-term financial sustainability of Medicare.

To combat the care denials, in June, Senator Roger Marshall (R-KS) re-introduced the Improving Seniors’ Timely Access to Care Act of 2024. The Act would create an electronic standard for prior authorization to expedite approvals, shorten the time health plans have to review these requests, and require Medicare Advantage plans to report on their prior authorization practices, including approval and denial rates. The bill is expected to be voted on at least in the Senate before the end of the year.

If the themes that emerged from this report continue, Congress may eventually look to take another step to ensure that seniors with Medicare Advantage are not disproportionately denied access to care. 

CMS released a report on Medicare Telehealth Trends covering January 2020-March 2024. As many might expect, telehealth usage spiked in 2020 but has steadily declined in the years since as the pandemic subsided.

Medicare open enrollment for 2025 (October 15 to December 7, 2024) will offer fewer Medicare Advantage and Part D prescription drug plans, forcing beneficiaries to find new coverage options.

On Tuesday, October 8, twenty states filed a lawsuit in Iowa challenging the CMS nurse staffing rule. The plaintiffs argue that the rule contradicts staffing requirements established from over 40 years ago and could cost nursing homes $6.8 billion per year.

Three pharmacy benefit managers (PBMs) – UnitedHealth Group, CVS Health, and Cigna – have filed motions to recuse three Democratic Federal Trade Commission (FTC) members in response to the FTC’s lawsuit accusing them of inflating insulin prices. The PBMs argue that the FTC members are biased against the PBM industry, but legal experts say there is little evidence to support these claims.

Walgreens has announced plans to close 1,200 stores over the next three years in an effort to control costs and improve profits.

UnitedHealth Group stated in its third-quarter earnings report that the February cyberattack on Change Healthcare has cost them about $2.5 billion, including over $1.7 billion in direct response costs.

Under a new Final Rule, Medicare patients who were originally hospitalized but later switched to outpatient “observation status” now have the opportunity to challenge their reclassification.