Medicare Advantage Plans Criticized for Denying Necessary Care

Recent reports by U.S. investigators have highlighted troubling practices among Medicare Advantage plans, which are known for quickly rejecting requests for short-term nursing home or inpatient rehabilitation services. An investigation revealed that major insurers involved in these plans denied approximately 13% of patients’ requests to be admitted to a skilled nursing facility following surgery or a serious illness.

Private Medicare Advantage plans, currently serving about 35 million older Americans, have faced criticism for inappropriate denials of medically necessary care. These plans, part of a federal Medicare program, often require prior authorization for treatment coverage. Being paid a set amount to care for patients creates a financial motive to limit spending on necessary services.

To cut costs, these plans often deny costly inpatient services like specialized rehabilitation or therapy, opting instead to redirect patients to outpatient facilities or back home. This approach continues to receive scrutiny from federal investigators.

The inspector general’s office at the Department of Health and Human Services released two new reports focusing on major insurers UnitedHealth Group, Humana, and CVS Health. These reports documented that 13% of requests for skilled nursing facility care were denied by these insurers, affecting patients’ recovery from surgery or severe illness.

Additional concerns were raised about the supervision of external contractors employed by these insurers to assess the need for specialized care. “The dominance of a few large insurance companies in Medicare Advantage means their policies and performance can significantly impact care for millions of people,” noted Rosemary Bartholomew, who led the investigation team.