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Category Archives: Health Insurance Denial
Empowering healthcare providers against rising payer denials
In the rapidly evolving landscape of U.S. healthcare, the tug-of-war between payers and providers is continually intensifying, raising the stakes on the strategic maneuvers that shape the industry’s financial and operational dynamics.
The crux of the issue lies in the increasingly sophisticated strategies employed by insurance companies to deny claims: a move that ostensibly aims to safeguard their bottom lines, often at the expense of provider sustainability and patient access.
The rise in denial rates is more than a mere statistic; it’s a symptom of a broader systemic challenge that calls for strategic foresight and robust expertise. In this intricate environment, providers face numerous administrative challenges, working to balance clinical decisions with financial sustainability.
Drawn from in-depth proprietary analytics, clinical regulatory expertise and decades of experience, CorroHealth addresses what is needed to successfully combat payer denial tactics. Broader industry trends, such as the shift towards value-based care and the increasing emphasis on patient-centric models, will continue to disrupt the historic provider business model. CorroHealth’s insights offer a beacon for steering through these turbulent waters. Their strategic recommendations, from optimizing contract negotiations to leveraging data analytics to managing payer denials, to formalizing escalation paths, reflect a comprehensive approach to mitigating the adverse effects of ever-shifting payer denial tactics.
Delving deeper into the anatomy of payer denials reveals a long-term pattern of deliberate complexity designed to wear down provider resilience. By dissecting the layers of denial management, from initial claim submission to final resolution, CorroHealth uncovers pivotal areas where targeted interventions dramatically shift outcomes in favor of healthcare providers.
This process involves a granular analysis of denial codes, predictive analytics to pre-empt possible denials and rigorous training staff to maneuver through the intricate appeals process effectively.
Taking a proactive stance towards payer contract management, their approach emphasizes the importance of scrutinizing the fine print and negotiating terms that anticipate and mitigate denial strategies. CorroHealth advocates on the providers’ behalf for clearer definitions of medical necessity, timely filing limits and transparent appeal processes. By equipping providers with negotiation tactics grounded in comprehensive data analysis and a deep understanding of payer methodologies, their contracts become a tool for protection against denials, rather than a source of vulnerability.
Woven throughout this work is CorroHealth’s commitment to advancing the dialogue between payers and providers toward a more equitable healthcare system. Through forums, partnerships and collaborative initiatives, CorroHealth bridges the gap between these two entities, fostering an environment where mutual understanding and respect pave the way for innovative solutions to longstanding challenges.
Hospitals and health systems require an experienced partner to navigate the complexities of the healthcare landscape, balancing financial sustainability with top-tier patient care. CorroHealth offers a comprehensive suite of solutions to address challenges associated with payer denials, enabling providers to recover lost revenues and uphold the fundamental goal of accessible, high-quality patient care. Beyond financial strategies and operational adjustments, the narrative calls for a more productive and transparent dialogue between payers and providers. This aims to encourage an ecosystem where financial sustainability and high-quality patient care are complementary facets of holistic healthcare delivery.
Facing these challenges, the importance of strategic partnerships becomes increasingly vital for healthcare providers. Such alliances are indispensable in maneuvering through the complex healthcare landscape and are strengthened by CorroHealth’s comprehensive understanding of the payer-provider dynamic and dedication to fostering innovation. A collaborative approach is essential for progressing towards a healthcare system characterized by greater equity and efficiency.
The industry stands at an existential crossroads. The insights and strategies shared by CorroHealth serve as a testament to the company’s expertise and its dedication to shaping a future where healthcare is accessible, affordable and effective for all.
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BIG INSURANCE 2023: Revenues reached $1.39 trillion thanks to taxpayer-funded Medicaid and Medicare Advantage businesses
The Affordable Care Act turned 14 on March 23. It has done a lot of good for a lot of people, but big changes in the law are urgently needed to address some very big misses and consequences I don’t believe most proponents of the law intended or expected.
At the top of the list of needed reforms: restraining the power and influence of the rapidly growing corporations that are siphoning more and more money from federal and state governments – and our personal bank accounts – to enrich their executives and shareholders.
I was among many advocates who supported the ACA’s passage, despite the law’s ultimate shortcomings. It broadened access to health insurance, both through government subsidies to help people pay their premiums and by banning prevalent industry practices that had made it impossible for millions of American families to buy coverage at any price. It’s important to remember that before the ACA, insurers routinely refused to sell policies to a third or more applicants because of a long list of “preexisting conditions” – from acne and heart disease to simply being overweight – and frequently rescinded coverage when policyholders were diagnosed with cancer and other diseases.
While insurance company executives were publicly critical of the law, they quickly took advantage of loopholes (many of which their lobbyists created) that would allow them to reap windfall profits in the years ahead – and they have, as you’ll see below.
Among other things, the ACA made it unlawful for most of us to remain uninsured (although Congress later repealed the penalty for doing so). But, notably, it did not create a “public option” to compete with private insurers, which many advocates and public policy experts contended would be essential to rein in the cost of health insurance. Many other reform advocates insisted – and still do – that improving and expanding the traditional Medicare program to cover all Americans would be more cost-effective and fair.
I wrote and spoke frequently as an industry whistleblower about what I thought Congress should know and do, perhaps most memorably in an interview with Bill Moyers. During my Congressional testimony in the months leading up to the final passage of the bill in 2010, I told lawmakers that if they passed it without a public option and acquiesced to industry demands, they might as well call it “The Health Insurance Industry Profit Protection and Enhancement Act.”
A health plan similar to Medicare that could have been a more affordable option for many of us almost happened, but at the last minute, the Senate was forced to strip the public option out of the bill at the insistence of Sen. Joe Lieberman (I-Connecticut), who died on March 27, 2024. The Senate did not have a single vote to spare as the final debate on the bill was approaching, and insurance industry lobbyists knew they could kill the public option if they could get just one of the bill’s supporters to oppose it. So they turned to Lieberman, a former Democrat who was Vice President Al Gore’s running mate in 2000 and who continued to caucus with Democrats. It worked. Lieberman wouldn’t even allow a vote on the bill if it created a public option. Among Lieberman’s constituents and campaign funders were insurance company executives who lived in or around Hartford, the insurance capital of the world. Lieberman would go on to be the founding chair of a political group called No Labels, which is trying to find someone to run as a third-party presidential candidate this year.
The work of Big Insurance and its army of lobbyists paid off as insurers had hoped. The demise of the public option was a driving force behind the record profits – and CEO pay – that we see in the industry today.
The good effects of the ACA:
Nearly 49 million U.S. residents (or 16%) were uninsured in 2010. The law has helped bring that down to 25.4 million, or 8.3% (although a large and growing number of Americans are now “functionally uninsured” because of unaffordable out-of-pocket requirements, which President Biden pledged to address in his recent State of the Union speech).
The ACA also made it illegal for insurers to refuse to sell coverage to people with preexisting conditions, which even included birth defects, or charge anyone more for their coverage based on their health status; it expanded Medicaid (in all but 10 states that still refuse to cover more low-income individuals and families); it allowed young people to stay on their families’ policies until they turn 26; and it required insurers to spend at least 80% of our premiums on the health care goods and services our doctors say we need (a well-intended provision of the law that insurers have figured out how to game).
The not-so-good effects of the ACA:
As taxpayers and health care consumers, we have paid a high price in many ways as health insurance companies have transformed themselves into massive money-making machines with tentacles reaching deep into health care delivery and taxpayers’ pockets.
To make policies affordable in the individual market, for example, the government agreed to subsidize premiums for the vast majority of people seeking coverage there, meaning billions of new dollars started flowing to private insurance companies. (It also allowed insurers to charge older Americans three times as much as they charge younger people for the same coverage.) Even more tax dollars have been sent to insurers as part of the Medicaid expansion. That’s because private insurers over the years have persuaded most states to turn their Medicaid programs over to them to administer.
Insurers have bulked up incredibly quickly since the ACA was enacted through consolidation, vertical integration, and aggressive expansion into publicly financed programs – Medicare and Medicaid in particular – and the pharmacy benefit space. Premiums and out-of-pocket requirements, meanwhile, have soared.
We invite you to take a look at how the ascendency of health insurers over the past several years has made a few shareholders and executives much richer while the rest of us struggle despite – and in some cases because of – the Affordable Care Act.
BY THE NUMBERS
In 2010, we as a nation spent $2.6 trillion on health care. This year we will spend almost twice as much – an estimated $4.9 trillion, much of it out of our own pockets even with insurance.
In 2010, the average cost of a family health insurance policy through an employer was $13,710. Last year, the average was nearly $24,000, a 75% increase.
The ACA, to its credit, set an annual maximum on how much those of us with insurance have to pay before our coverage kicks in, but, at the insurance industry’s insistence, it goes up every year. When that limit went into effect in 2014, it was $12,700 for a family. This year, it has increased by 48%, to $18,900. That means insurers can get away with paying fewer claims than they once did, and many families have to empty their bank accounts when a family member gets sick or injured. Most people don’t reach that limit, but even a few hundred dollars is more than many families have on hand to cover deductibles and other out-of-pocket requirements.
Now 100 million Americans – nearly one of every three of us – are mired in medical debt, even though almost 92% of us are presumably “covered.” The coverage just isn’t as adequate as it used to be or needs to be.
Meanwhile, insurance companies had a gangbuster 2023. The seven big for-profit U.S. health insurers’ revenues reached $1.39 trillion, and profits totaled a whopping $70.7 billion last year.
SWEEPING CHANGE, CONSOLIDATION–AND HUGE PROFITS FOR INVESTORS
Insurance company shareholders and executives have become much wealthier as the stock prices of the seven big for-profit corporations that control the health insurance market have skyrocketed.
REVENUES collected by those seven companies have more than tripled (up 346%), increasing by more than $1 trillion in just the past ten years.
PROFITS (earnings from operations) have more than doubled (up 211%), increasing by more than $48 billion.
The CEOs of these companies are among the highest paid in the country. In 2022, the most recent year the companies have reported executive compensation, they collectively made $136.5 million.
U.S. HEALTH PLAN ENROLLMENT
Enrollment in the companies’ health plans is a mix of “commercial” policies they sell to individuals and families and that they manage for “plan sponsors” – primarily employers and unions – and government/enrollee-financed plans (Medicare, Medicaid, Tricare for military personnel and their dependents and the Federal Employee Health Benefits program).
Enrollment in their commercial plans grew by just 7.65% over the 10 years and declined significantly at UnitedHealth, CVS/Aetna and Humana. Centene and Molina picked up commercial enrollees through their participation in several ACA (Obamacare) markets in which most enrollees qualify for federal premium subsidies paid directly to insurers.
While not growing substantially, commercial plans remain very profitable because insurers charge considerably more in premiums now than a decade ago.
By contrast, enrollment in the government-financed Medicaid and Medicare Advantage programs has increased 197% and 167%, respectively, over the past 10 years.
Of the 65.9 million people eligible for Medicare at the beginning of 2024, 33 million, slightly more than half, enrolled in a private Medicare Advantage plan operated by either a nonprofit or for-profit health insurer, but, increasingly, three of the big for-profits grabbed most new enrollees. Of the 1.7 million new Medicare Advantage enrollees this year, 86% were captured by UnitedHealth, Humana and Aetna. Those three companies are the leaders in the Medicare Advantage business among the for-profit companies, and, according to the health care consulting firm Chartis, are taking over the program “at breakneck speed.”
It is worth noting that although four companies saw growth in their Medicare Supplement enrollment over the decade, enrollment in Medicare Supplement policies has been declining in more recent years as insurers have attracted more seniors and disabled people into their Medicare Advantage plans.
OTHER FEDERAL PROGRAMS
In addition to the above categories, Humana and Centene have significant enrollment in Tricare, the government-financed program for the military. Humana reported 6 million military enrollees in 2023, up from 3.1 million in 2013. Centene reported 2.8 million in 2023. It did not report any military enrollment in 2013.
Elevance reported having 1.6 million enrollees in the Federal Employees Health Benefits Program in 2023, up from 1.5 million in 2013. That total is included in the commercial enrollment category above.
PBMs
As with Medicare Advantage, three of the big seven insurers control the lion’s share of the pharmacy benefit market (and two of them, UnitedHealth and CVS/Aetna, are also among the top three in signing up new Medicare Advantage enrollees, as noted above). CVS/Aetna’s Caremark, Cigna’s Express Scripts and UnitedHealth’s Optum Rx PBMs now control 80% of the market.
At Cigna, Express Scripts’ pharmacy operations now contribute more than 70% to the company’s total revenues. Caremark’s pharmacy operations contribute 33% to CVS/Aetna’s total revenues, and Optum Rx contributes 31% to UnitedHealth’s total revenues.
WHAT TO DO AND WHERE TO START
The official name of the ACA is the Patient Protection and Affordable Care Act. The law did indeed implement many important patient protections, and it made coverage more affordable for many Americans. But there is much more Congress and regulators must do to close the loopholes and dismantle the barriers erected by big insurers that enable them to pad their bottom lines and reward shareholders while making health care increasingly unaffordable and inaccessible for many of us.
Several bipartisan bills have been introduced in Congress to change how big insurers do business.
They include curbing insurers’ use of prior authorization, which often leads to denials and delays of care; requiring PBMs to be more “transparent” in how they do business and banning practices many PBMs use to boost profits, including spread pricing, which contributes to windfall profits; and overhauling the Medicare Advantage program by instituting a broad array of consumer and patient protections and eliminating the massive overpayments to insurers.
And as noted above, President Biden has asked Congress to broaden the recently enacted $2,000-a-year cap on prescription drugs to apply to people with private insurance, not just Medicare beneficiaries. That one policy change could save an untold number of lives and help keep millions of families out of medical debt. (A coalition of more than 70 organizations and businesses, which I lead, supports that, although we’re also calling on Congress to reduce the current overall annual out-of-pocket maximum to no more than $5,000.)
I encourage you to tell your members of Congress and the Biden administration that you support these reforms as well as improving, strengthening and expanding traditional Medicare. You can be certain the insurance industry and its allies are trying to keep any reforms that might shrink profit margins from becoming law.
DEATH BY PAPERWORK: Watch NYT Opinion video on health insurers’ “prior authorization” practices
If a picture is worth a thousand words, a video, if done well, can be worth thousands more.
Regular readers of HEALTH CARE un-covered know we have published lots of words about the barriers health insurance companies have erected that make it harder and harder for patients to get the care their doctors know they need.
Well, the New York Times has put together one of the best videos I’ve come across to describe one of those barriers–prior authorization. I hope you’ll take a few minute to watch it.
As a former health insurance executive, I’ve seen firsthand how the health insurance industry’s use of prior authorization inflicts harm on patients.
It’s a perfect example of how something that was designed to protect patients from inappropriate and unnecessary care has been weaponized by health insurers to pad their bottom lines.
Prior authorization in today’s world all too often serves as a bureaucratic barrier, requiring patients and their doctors to obtain approval in advance from insurers before certain treatments, medications, or procedures will be covered.
While insurance companies argue that prior authorization helps control costs and ensure appropriate care, the reality is far grimmer.
Both patients and their health care providers suffer the consequences. Patients frequently face delays in receiving necessary treatments or medications, exacerbating their health conditions and causing unnecessary stress and anxiety. Many forgo needed care altogether due to the complexities and frustrations of navigating the prior authorization process. This practice not only undermines patients’ trust in their health care providers but also compromises their health, often leading to worsened conditions and, tragically, sometimes irreversible harm.
The burden of prior authorization falls heavily on clinicians and their office staff who must spend valuable time and resources navigating the bureaucratic red tape imposed by insurers. This administrative burden not only detracts from patient care but also contributes to physician burnout, dissatisfaction and moral crisis, according to many doctors.
Ultimately, the health insurance industry’s prioritization of profit over patient well-being is evident in its insistence on maintaining these barriers to care, perpetuating a system that defaults to financial gain at the expense of human lives.
The New York Times video cuts to the chase. Prior authorization, as practiced today by insurance companies, is “medical injustice disguised as paperwork.”
Senators concerned Medicare Advantage plans deny long-term care
A pair of senators are asking CMS to require Medicare Advantage plans to cover stays in long-term care facilities at the same rate as traditional Medicare.
Chris Murphy, a Connecticut Democrat, and Thom Tillis, a North Carolina Republican, wrote a letter to CMS Administrator Chiquita Brooks-LaSure Dec. 21, asking the agency to clarify MA plans cannot use different standards to approve long-term care than traditional Medicare.
In their letter the senators wrote they have heard concerns from long-term care hospitals in states that “regularly receive denial letters from Medicare Advantage plans.”
“Unfortunately, Medicare Advantage plan prior authorization practices are creating significant barriers to [long-term hospital] care for critically and chronically ill patients,” the senators wrote.
In a final rule issued in April, CMS said Medicare Advantage plans cannot implement prior authorization criteria that are more stringent than traditional Medicare. In their letter, the senators asked the agency to clarify this statute also applies to long-term care hospitals.
“We write to ask CMS to confirm this interpretation is correct and to request such information be publicly clarified to eliminate confusion for Medicare Advantage plans and ensure that [long-term care hospitals] are treated the same as any other post-acute care provider under the Medicare Advantage regulations,” the senators concluded.
Read the full letter here.
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FDA approves landmark sickle cell gene therapy treatment
https://mailchi.mp/79ecc69aca80/the-weekly-gist-december-15-2023?e=d1e747d2d8
Last week, the Food and Drug Administration (FDA) approved two gene therapy treatments for sickle cell disease, Casgevy and Lyfgenia.
Casgevy, jointly developed by Boston, MA-based Vertex Pharmaceuticals and Switzerland-based CRISPR Therapeutics, is the first approved treatment of any kind available to US patients that uses CRISPR’s gene-editing capabilities.
Lyfgenia, made by Somerville, MA-based Bluebird Bio, uses a more common retrovirus technique for genetic modification. The FDA estimates that about 20K Americans with sickle cell disease will be eligible for the therapies, limited to those patients 12 and older who have had episodes of debilitating pain.
Both treatments will only be available at a small number of facilities nationwide, priced between $2-3M, and require a patient to endure months of hospitalization as well as intensive chemotherapy. Around 100K mostly Black Americans suffer from sickle cell disease, which causes intense pain, organ damage, and reduced life expectancy. Previously, the only curative treatment was a bone marrow transplant.
The Gist: The approval of these drugs represents a milestone moment for those suffering from sickle cell disease, while Casgevy also fulfills the revolutionary promise scientists have seen in CRISPR since it first received broad attention in 2005.
However, now that gene-editing therapies have graduated from the domain of scientific possibility into the realities of our healthcare delivery system, the new challenge becomes ensuring accessibility and equity, as many Americans who most stand to benefit from it also experience barriers in access to care and insurance coverage. (We’d expect insurer pushback similar to that seen when the first highly effective, but extremely costly, hepatitis C treatments like Solvaldi hit the market a decade ago this month.)
While the clinical trial patients who received Casgevy report having “a new lease on life”, sky–high costs, questions of insurance coverage, and the arduous, time-intensive nature of the procedure stand in the way of a population-wide cure for sickle cell disease.
HENRY KOTULA 