Like the classic cartoon image of a small snowball rolling down a mountain, picking up more snow along the way, and eventually becoming a monstrous juggernaut by the time it reaches the bottom, small errors by Medicare Advantage Organization claim evaluators can add up to thousands of patients being denied necessary care and millions of dollars in lost reimbursement for providers. 

These mistakes came to light recently in a report by the U.S. Department of Health and Human Services Office of Inspector General,¹ which found both patients and providers were getting bowled over by the system.

On the patient side, the report found that, “Of 12,273 denials of requests for services (prior authorization denials) issued by 15 selected MAOs during the first week of June 2019, an estimated 13 percent [actually] met Medicare coverage rules.” Annually, this would extrapolate out to almost 85,000 unjust denials in a single year. 

The OIG found that many of these denials were based on small errors. For instance in one case, the MAO declared that a beneficiary would need to wait at least a year for a follow-up MRI for an adrenal lesion, “because the size of the lesion (less than 2 cm) was too small to warrant follow-up.” However, there is no such Medicare rule, and the decision was eventually reversed after an appeal. 

In another case, the OIG says an MAO denied a request for a walker for a patient in his 70s with post-polio syndrome because he had “already received a cane within the past five years.” The problem, the report states, is that this ruling was just plain wrong: There is no such Medicare ambulatory assistance device limit. 

For physicians, these errors hurt their economic well-being more than their physical health. “Of the 160,378 payment denials issued by the 15 selected MAOs,” the OIG states, “an estimated 18 percent met Medicare coverage rules and MAO billing rules and should have been approved by the MAOs ... For an annual context, if these MAOs denied the same number of payment requests (28,949) in each of the other 51 weeks of 2019, they would have denied 1.5 million [valid] requests.” 

As with the patients, the little things added up: “MAOs denied payments to providers because of human error during manual reviews ...” the report found. “However, these manual reviews are susceptible to human error, such as a reviewer’s overlooking a document in the case file or inaccurately interpreting CMS or MAO coverage rules.”

Fortunately, it looks like there’s light at the end of the tunnel: In mid-May, the “Improving Seniors’ Timely Access to Care Act” achieved bi-partisan support in Congress, and is on its way to becoming law. The bill stipulates, among other things, that prior-authorization requests will be evaluated by qualified medical personnel. It looks to be a win for both doctors and their patients.

— Walter Bethke
Editor in Chief

^{1. HHS Office of Inspector General report. Some Medicare Advantage Organization denials of prior authorization requests raise concerns about beneficiary access to medically necessary care. https://oig.hhs.gov/oei/reports/OEI-09-18-00260.pdf. Accessed May 20, 2022.}