Rise in Medicare Advantage Denials Ahead of New Rules Raises Concerns

KFF recently conducted an analysis of Medicare Advantage (MA) data related to prior authorization, revealing an important trend. While the overall rate of prior authorization requests—submissions from providers and beneficiaries seeking coverage for specific services—remained stable, the rate of plan denials increased compared to the previous two years. This indicates that more services recommended by providers are being rejected by MA plans. Despite this rise in denials, the appeal rates stayed low, suggesting that many enrollees, after facing a denial, either had to alter their treatment plans or forgo the care their provider originally recommended. This growing gap between requests and approvals raises concerns about access to necessary care for beneficiaries.

KFF’s latest analysis of Medicare Advantage (MA) data shows that MA organizations received 46 million prior authorization requests in 2022, up 5 million from 2019. However, this increase is due to more people enrolling in MA plans, not because individual enrollees are making more requests. On average, plans received 1.7 prior authorization requests per enrollee in both 2019 and 2022.

Even though the number of requests stayed the same, MA plans denied an average of 7.4% of them in 2022. This is up from 5.7% in 2019 and 5.8% in 2021.

When a plan denies a prior authorization request, they are required to explain why in writing. But often, these denial notices can be unclear, missing important details, or not even received by the person. Many people don’t fully understand their right to appeal or feel like they don’t have the time or ability to go through the process. If they don’t appeal, they either have to go without the service or pay for it themselves.

Not surprisingly, KFF found that less than 10% of denied requests are appealed. This supports earlier findings that most enrollees don’t appeal when their Medicare Advantage requests are denied.

When enrollees do appeal, they often win. KFF found that over 80% of appeals are successful. This could mean only people with strong cases are filing appeals, but it could also suggest that plans might be denying care inappropriately—either by misunderstanding the rules or intentionally to cut costs, hoping people won’t go through the trouble of appealing or don’t have enough information to do so.

New rules in 2023 aim to improve and clarify prior authorization processes. These changes can help plans and providers better understand coverage rules, possibly reducing denials or making appeals easier.

The KFF analysis, based on 2022 data, provides a key baseline for future comparisons once data under the new rules is available. At Medicare Rights, we see prior authorization as a major barrier to care for our callers. In 2022, 29% of our helpline calls were about denials and appeals, mostly from Medicare Advantage enrollees facing care access issues. We’ll keep working with policymakers to reduce inappropriate denials and improve transparency in MA processes.