For many seniors, Medicare Advantage (MA) plans appear to offer great advantages: they offer access to a wide range of non-traditional services, there’s no deductible, and one doesn’t need Medigap to cover the cost of any services. For many health insurance companies, MA plans also appear to offer great advantages — if the people enrolling in those plans are relatively healthy, the plans can be very profitable.

These assumptions are not proving to be the case. Today, around half of everyone enrolled in Medicare is enrolled in a MA plan, and many of them have costly medical needs, which means more trips to doctors, more trips to hospitals, more tests, more rehab visits, and much more administrative overhead.

That administrative overhead in particular is posing problems in the world of MA. Unlike traditional Medicare, MA plans require prior authorization for many procedures, tests, visits, and more. Facilities and practitioners both say that authorizations are denied at a far higher rate by MA payers than by non-MA payers. One Oklahoma-based medical center found that it had experienced a 22% prior authorization denial rate for patients on MA plans, compared to a 1% denial rate for patients on traditional Medicare plans. Even more problematically for patients, many of those denials should never have occurred. According to KFF Health News, more than 35 million requests for prior approval were submitted for Medicare Advantage enrollees in 2021, and more than 2 million were denied. Only 11% of the patients who were denied services appealed the decision, but of those 82% had the denials overturned either fully or partially.

The frustration with prior authorization, to say nothing of the length of time it takes providers to be paid under MA plans, is causing many providers and institutions to stop accepting MA plans. The burden of trying to comply with prior authorization requirements is simply too great. This in turn puts significant pressure on MA subscribers, who find their options for using what they thought would be a strong supportive care system are growing more limited.

But the key to solving these challenges lies not in abandoning MA but in making it easier for institutions and providers to obtain prior authorization on behalf of patients. The CMS Interoperability and Prior Authorization Final Rule is designed to improve prior authorization processing for medical items and services, reducing the number of denials and expediting approvals. Institutions and providers will still need to get prior authorization in advance of treatment for patients on MA, but with the changes supported by legislation the process can become more automated and less burdensome. The administrative challenge will become one of understanding which prior authorizations have been approved and which have not, which are still in process and which are complete.

Of course, the functionality to do that is built into a modern utilization management (UM) platform. The details of prior authorization status will be triggered by the EMR, with the results of the authorization request transacted back into the EMR so that the EMR can provide insight into the status of prior authorizations for one or more patients easily.

Going forward, with new systems and workflows, the hope is that providers will remain within their optimal workflow’s IT system, with the UM system functioning as the authorization engine without forcing providers to the UM user interface. As always, each user should be able to remain within their own workflow’s IT system, with interoperability providing external information in order to complete the workflow.

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