Medicare Advantage insurers made about 50 million prior authorization determinations in 2023
The increase in prior authorization determinations since 2020 is linked to an increase in MA enrollment, KFF says.
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Medicare Advantage insurers made nearly 50 million prior authorization determinations in 2023, reflecting steady increases over the past few years as the number of MA enrollees has grown, according to a new KFF analysis.
Determinations are requests for approval that providers are required to submit before providing a service. Far fewer prior authorization reviews for traditional Medicare beneficiaries were submitted to CMS – just under 400,000 in fiscal year 2023 – though the number of people enrolled in Medicare Advantage and traditional Medicare were similar in these years.
In 2023, there were nearly two prior authorization determinations on average per Medicare Advantage enrollee, similar to the amount in 2019. In contrast, in 2023, about one prior authorization review was submitted per 100 traditional Medicare beneficiaries – a rate of about 0.01 per person – which, according to KFF, reflects the limited set of services subject to prior authorization in traditional Medicare.
WHAT'S THE IMPACT?
The recent increase in the total number of prior authorization determinations since 2020 corresponds to an increase in Medicare Advantage enrollment, KFF said. Between 2019 and 2023, the number of MA enrollees rose from 22 million people to 31 million people.
In 2019, there were about 1.7 prior authorization determinations per MA enrollee. That number dropped at the onset of the COVID-19 pandemic to 1.4 in 2020 and 1.5 in 2021, before returning to the pre-pandemic level of 1.7 determinations per enrollee in 2022, and rising slightly to 1.8 in 2023.
When it came to denials, insurers fully or partially denied 3.2 million prior authorization requests in 2022, which at 6.4% is a somewhat smaller share of all requests than in 2022 (7.4%).
Though there were substantially fewer prior authorization reviews for traditional Medicare beneficiaries, a larger share was denied – 28.8% in 2023. Denial rates varied across the limited set of services subject to prior authorization in traditional Medicare, KFF said.
Only about 11.7% of denied prior authorization requests were appealed in Medicare Advantage in 2023, though that's still an increase since 2019, when 7.5% of denied requests were appealed.
Most appeals were partially or fully overturned in 2023, data showed. That compares to less than one-third (29%) of appeals overturned in traditional Medicare in 2022. These requests, said KFF, represent medical care that was ordered by a healthcare provider and ultimately deemed necessary, but was potentially delayed because of the additional step of appealing the initial prior authorization decision.
THE LARGER TREND
A June survey from the American Medical Association found the prior authorization process continues to have a "devastating" effect on patient outcomes, physician burnout and employee productivity.
In addition to negatively impacting care delivery and frustrating physicians, PA is also leading to unnecessary spending in the form of additional office visits, unanticipated hospital stays and patients regularly paying out-of-pocket for care, results showed.
In the AMA's annual survey of 1,000 practicing physicians, 94% reported that PA resulted in delays to care, while 78% reported that it can sometimes lead to the abandonment of treatment altogether.
Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.