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Since their introduction 20 years ago, Medicare Advantage plans have become a rapidly expanding option in the Medicare system. In 2023, more than 30 million people enrolled in a Medicare Advantage plan, accounting for 51% of those eligible for Medicare. By 2033, those enrolled in Medicare Advantage plans are expected to rise to 62% of all eligible beneficiaries of Medicare, according to the Congressional Budget Office.
Medicare Advantage, also known as Medicare Part C, offers many benefits. By law, private insurance companies that administer Advantage plans are required to offer the same benefits as original Medicare, which consists of Part A (hospital insurance) and Part B (medical insurance). Depending on the Medicare Advantage plan, they often come with extra benefits not provided in original Medicare, such as prescription drug coverage, vision, dental care, sometimes gym membership and more.
However, one potential drawback can be their use of prior authorizations when determining if care is medically necessary. If a service or procedure is deemed medically unnecessary, your Medicare Advantage plan can deny coverage.
Here’s what to do if your Medicare Advantage plan refuses to provide coverage.
[READ What to Do When Medicare Stops Paying for Skilled Nursing Care]
Advantage Plans and Prior Authorization
A prior authorization is when your health care provider must first obtain approval from your health insurance plan before moving forward with a specific medication, procedure or treatment. It is a common process that helps prevent unnecessary care, decrease wasteful spending and maintain insurance company profit. However, there is concern that the current system may also create barriers and delays to medically necessary care for seniors.
A data analysis done by KFF found that Advantage plans denied approximately 6%, or 2 million, of the 35 million prior authorization requests submitted in 2021. Only 11% of denials were appealed, but 82% of those denials were overturned on appeal.
In 2022, researchers evaluated data from a large insurer’s claims and found that one-third of Advantage enrollees faced one or more service denials each year. Approximately 15% of the 5.6 million denials stemmed from Advantage policies that were more restrictive than original Medicare coverage, suggesting that some Advantage plans may at times deny care that would be covered under original Medicare. This was further corroborated by the Office of the Inspector General, which found that 13% of coverage denials by Advantage plans actually met original Medicare coverage criteria.
Noting these discrepancies, the Centers for Medicare & Medicaid Services issued a final rule stipulating coverage for Advantage enrollees must not be more restrictive than original Medicare.
“A number of changes have been made by the CMS in the past few years aimed at trying to ensure that Advantage plans do not improperly deny care through the prior authorization process,” says David Lipschutz, the co-director and attorney for the Center for Medicare Advocacy in Washington, D.C.
For example, the Improving Seniors Timely Access to Care Act, which aims to streamline some prior authorization processes in Advantage plans and reinforce some of CMS’ regulations, was re-introduced in June 2024 and is currently pending in Congress.
In 2022, almost all Advantage enrollees (99%) were enrolled in plans that require prior authorization, according to KFF.
Depending on the Advantage plan, prior authorizations may be needed for:
— Certain prescription medicines
— Chemotherapy or radiation treatments
— Imaging services, such as MRIs or CT scans
— Physical, occupational or speech therapy
— Specialist visits
[READ: Medicare Mistakes to Avoid.]
Reasons for Denial
There are many reasons why a prior authorization may be denied, including:
— Administrative errors. Sometimes there can be mistakes or incomplete information, such as missing codes in the submitted paperwork or an error in processing the request.
— Benefit exhaustion. If the enrollee has exhausted their benefits for the year, such as hitting the maximum out-of-pocket limit or coverage limit for a particular service, coverage may be denied.
— Insufficient documentation. The submitted request did not include enough information or documentation to support the claim of medical necessity.
— Lack of medical necessity. If the plan determines that the requested service or medication is not medically necessary, coverage may be denied.
— Lack of FDA approval. A plan may deny coverage if the treatment or medication has not been approved by the Food and Drug Administration for the specific condition being treated.
— Out-of-network providers or facilities. Many plans require enrollees to use in-network providers or facilities only.
[READ: How to Get Access to Your Hospital Records]
How to Appeal a Denial
Going through the process of appealing a denial can be a frustrating and time-consuming process, but it may be worth the effort in the end.
“Most people don’t bother to appeal denials, but we urge people to do so,” Lipschutz explains. “Your chances of winning are generally better after the first couple levels of appeal.”
Before you begin, carefully read the denial letter and note down any questions or concerns you have. At each level, a set of instructions on how to move the appeal to the next level should be included with the decision letter.
Call your plan to review the denial and to confirm that it wasn’t issued because of something easily resolvable, such as missing or incomplete information or an administrative error.
If you still feel that an appeal is warranted, Medicare’s appeal process has five levels:
— Level 1: Reconsideration. You will need to begin the process through your Advantage plan. To begin, you, your representative or doctor must appeal within 60 days of the coverage determination. If you miss the deadline, you must include in your appeal the reason for filing late.
— Level 2: Review by an Independent Review Entity (IRE). If your appeal is denied, you have the right to request a review by an independent third party that works for Medicare, not your insurance plan.
— Level 3: Decision by the Office of Medicare Hearings and Appeals (OMHA). If the denial is upheld by the IRE, you have the right to request a hearing before an administrative law judge (ALJ) or to have them decide without a hearing based on the information in your appeal record. Hearings are typically held by phone or video teleconference.
— Level 4: Medicare Appeals Council review. If the ALJ denies the appeal, you have the right to ask for a review by the Medicare Appeals Council.
— Level 5: Judicial review by a federal district court. In order for your appeal to move forward to this final level, the amount of the appeal must meet the minimum amount of $1,840 in 2024.
Advantage appeals have two response times: standard and expedited. The plan has to respond in writing within 30 calendar days for a standard request and within 72 hours for an expedited request. There are different response times for each level of appeal that must be met and a useful chart outlining response times can be found at Medicare.gov.
Helpful Tips
Experts recommend adopting these tips to strengthen your appeal:
— Keep detailed records. Keep a file with all of the paperwork from every appeal level that was sent to you. Keep a detailed account of any phone calls with your insurance plan, including dates, times and what was said.
— Be repetitive. Even if you think they should already have it, make sure in all written correspondence you provide your name, address, Medicare number, the service being appealed and the reason why.
— Understand your rights. Familiarize yourself with your rights under Medicare and your Medicare Advantage plan. Lipschutz advises researching your plan’s coverage rules, making sure you understand what criteria must be met so you can be better prepared to argue your case.
— Be persistent. Don’t give up if your appeal is denied at first. You may need to appeal multiple times in order to be successful.
Bottom Line
Prior authorizations can prevent unnecessary care and decrease wasteful spending, but they can also create barriers and delays in obtaining necessary and timely care. There are many reasons a Medicare Advantage plan can deny a prior authorization from easily corrected administrative errors to the more challenging denials, such as proving medical necessity.
If you feel your Medicare Advantage plan inappropriately denied your request, you should feel empowered to appeal your denial.
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What to Do When Medicare Advantage Plans Deny Coverage originally appeared on usnews.com
