While Medicare Advantage (MA) plans are required to cover the same health services as Original Medicare, they are not required to offer the same level of provider access and can impose coverage restrictions—like prior authorization—that require enrollees to take additional steps before accessing prescribed care. If a service is covered “with prior authorization,” enrollees must get approval from the plan prior to receiving the service. If approval is not granted or sought, the plan generally will not cover it.
A new analysis from the Kaiser Family Foundation looks at the prevalence of prior authorization in MA and found that many plans utilize this flexibility: 80% of MA enrollees are in plans that require prior authorization for at least one Medicare-covered service. Original Medicare, in contrast, does not require prior authorization for the vast majority of services, making this an important distinction between the two coverage options.
In some instances, prior authorization may be an appropriate utilization management tool. In particular this is true when both beneficiaries and providers are likely to benefit from advance knowledge of Medicare coverage. However, MA’s broad application of prior authorization can impede access to care.
On our National Helpline, we frequently hear from MA enrollees who are experiencing a range of denials for health-related services, and who are concerned and confused about their plan’s service denials and coverage requirements. While each MA plan has different rules, as the KFF report indicates, many require enrollees to obtain approval before receiving an array of critical services:
- At least 70% of enrollees are in plans that require prior authorization for Part B drugs and inpatient hospital stays.
- 60% of enrollees are in plans that require prior authorization for ambulance, home health, procedures, and laboratory tests.
- More than half of enrollees are in plans that require prior authorization for mental health services.
In such situations, there is minimal value to beneficiaries or providers in procuring pre-service determinations. Instead, these requirements can often create barriers that may delay or prevent timely access to needed, affordable care.
Additionally, coverage denials can have significant financial implications for the enrollee. Many face high out-of-pocket costs as a result, in particular those who miss the short 60-day window of time to appeal. Unlike Original Medicare, MA enrollees must appeal within 60 days of the date of service. If they miss this deadline, they are held responsible for the charges.
While we support efforts to lower Medicare program costs and increase certainty about the scope of coverage, the potential consequences of such policies must be carefully considered, and any harms to to people with Medicare must be thoughtfully and thoroughly mitigated.
We are pleased to see that many in Congress recognize the severity of these adverse impacts. Earlier this month, more than 100 lawmakers sent a letter to the Centers for Medicare & Medicaid Services (CMS) expressing concern about the use of prior authorization in MA, and asking for agency guidance to ensure that these requirements do not create inappropriate barriers to care for people with Medicare. The effort was led by Rep. David P. Roe (R-TN-1) and Rep. Ami Bera (D-CA-7), and the Medicare Rights Center recently thanked them for their leadership.
We look forward to working with Congress, the Administration, and our organizational partners to strengthen these and other beneficiary protections within Original Medicare and MA, with the goal of improving the health and economic security of people with Medicare.