A new report and infographic from the American Hospital Association (AHA) highlights how some commercial health insurers apply policies that can cause dangerous delays in care for patients, result in undue burden on health care providers and add billions of dollars in unnecessary costs to the health care system.
The report, which includes results of surveys conducted by the AHA, found 78% of hospitals and health systems reported their experience working with commercial insurers is getting worse, with fewer than 1% reporting it was getting better. The AHA fielded the surveys in 2019 with more than 200 hospitals responding and again between December 2021 and February 2022 with 772 hospitals responding. While some findings predate COVID-19, recent data reinforces challenges from before the public health emergency that have persisted.
The report focuses specifically on patient and hospital experiences with prior authorization and payment delays, denials and appeals. Hospitals and health systems report growing rates of delays and denials for medically necessary care and that appeals frequently result in insurers overturning their earlier decisions. This calls into question the initial denials and the burden associated with challenging them. The tactics highlighted can delay patient care and put even more strain on an already overburdened workforce, with 95% of hospitals and health systems reporting increases in staff time spent seeking prior authorization approvals.
“These survey results are stark evidence that some commercial health insurers deny care while hospitals and health systems focus on providing care,” said AHA President and CEO Rick Pollack. “Patients deserve comprehensive health coverage with the protections they were promised when they signed up. Congress and the Administration need to act now to hold commercial insurers accountable for actions that delay patient care, contribute to clinician burnout and workforce shortages, and increase costs.”
The survey results echo findings from a U.S. Department of Health and Human Services Office of Inspector General report from earlier this year that raised serious concerns about beneficiary access to care and inappropriate coverage and payment denials in the Medicare Advantage program. Nearly half of Medicare beneficiaries are enrolled in a private Medicare Advantage health plan, and enrollment in these plans is growing at a rate of nearly 10% per year, raising the importance of ensuring adequate oversight in the program.
In a letter sent to Health and Human Services Secretary Xavier Becerra and Department of Labor Secretary Martin Walsh, the AHA stressed the importance of comprehensive coverage for patients and urged the Administration to take additional actions to ensure adequate oversight of commercial health insurers.
The AHA report offers a number of solutions for policymakers to reduce the risk and burden of certain commercial health insurer practices while still enabling insurers to compete on quality, benefit package design, provider networks and other important aspects of coverage. These include streamlining prior authorization processes and increasing oversight so that regulators can target specific inappropriate behaviors.