Latest news with #healthinsurers
Bloomberg
17-07-2025
- Business
- Bloomberg
Wall Street Worries a Health Insurance Meltdown Is Far From Over
The tide of US government money that has been pouring into health insurers for decades is reversing more abruptly than expected, putting strategies that drove profit growth for years in doubt. Elevance Health Inc. 's earnings on Thursday were the latest blow. The company slashed its profit outlook after struggling to contain higher medical costs in Affordable Care Act plans and lagging reimbursements from Medicaid safety net plans for the poor.
Forbes
02-07-2025
- Health
- Forbes
To Avoid Government Action, Insurers Promise Prior Authorization Fixes
Insurers designate certain prescription drugs with prior authorization to ensure safe and medically ... More appropriate use but also to contain costs. Here, a healthcare provider must obtain approval from a health insurer before prescribing a medication. This process ensures that the treatment is medically necessary and that the insurance will cover the costs. Major health insurers say they're changing the way prior authorization works to make it more patient friendly. This appears to be in response to longstanding criticism from patient and healthcare provider groups that the process of getting pre-approval from health plans for reimbursement of healthcare services and technologies is too onerous. Insurance companies may also be promising fixes to preempt government action that would attempt to curb the use of prior authorization. Representatives from several major health insurers said last week they had pledged to the Department of Health and Human Services they would improve their prior authorization protocols for diagnostic and screening tests, prescription medications and hospital or clinic procedures. The insurers vowed to reduce the number of claims subject to prior authorization, standardize electronic requests for exemptions and appeals and resolve 90% of requests in real time by 2027. They also hope that artificial intelligence will facilitate a more efficient prior authorization process. In the case of medicines, prior authorization is typically required for brand-name drugs that have a generic available, as well as high-cost therapeutics, whether branded or generic. Here, prior authorization implies that a healthcare provider or patient must obtain pre-approval from a health insurer before prescribing a medication or having it dispensed at the pharmacy. From the perspective of health plans, this process ensures that only treatments deemed 'medically necessary' will be covered. Health insurers issue millions of denials based on prior authorization every year. Patients can request medical exemptions or appeal plan decisions, but the process can be complicated and cumbersome. NBC News reports that some patients are 'stuck in prior authorization' purgatory, as they 'run out of time or treatment options.' An Office of Inspector General memorandum recently pointed to instances in which Medicare Advantage plans incorrectly denied beneficiaries' access to services even though they met Medicare coverage rules. Decades ago, when prior authorization was first introduced, it was mostly deployed to ensure medicines were being administered to or taken by the right patient for an appropriate indication. To some extent, this holds true today, too. Prescription medications tagged with prior authorization can have potential safety concerns, including things like drug-drug interactions which prescribers and patients need to be aware of. Additionally, certain drugs should only be prescribed to patients who've been identified through biomarker testing as being likely to respond positively or unlikely to suffer from an adverse reaction. In these instances, prior authorization is essential. Ideally, prior authorization can be used to optimize the use of healthcare services and technologies. If used judiciously, such policies are intended to be checks on overutilization. In this context, insurers can nudge physicians towards prescribing less costly alternatives that are therapeutically equivalent. But this presumes the treatment options health plans favor work as well or better than the intervention placed under prior authorization protocol. Moreover, imposing such a prerequisite can increase the administrative burden on both doctors and patients, delay care or result in no treatment at all, which may in turn lead to worse health outcomes and greater costs in the long run. What's more, even in the short term, plans may not actually save that much by instituting prior authorization as it doesn't ultimately prevent that many patients from accessing products. To illustrate, upon appeal, of 35 million prior authorization requests to Medicare Advantage plans in 2021, 82% were overturned. In light of the problems cited above, health insurers are pledging fixes to the ways in which prior authorization is implemented. This isn't the first time the industry has promised to streamline the process. Insurers made a similar promise during the first Trump Administration in 2018. When Centers for Medicare and Medicaid Services Administrator Mehmet Oz was asked recently why he thought this effort by the industry could work when others have failed, he responded by saying that the technology is better now and the administration plans to back the efforts with regulation. 'Either you fix it, or we'll fix it,' Oz told insurance company executives. But the executive branch doesn't have many levers at its disposal without Congress's support. Perhaps Oz is referencing the bills that have been introduced by Democrats and Republicans alike which specifically target Medicare Advantage plans. The proposals focus on standardizing their prior authorization protocols and increasing transparency of and reporting on decision-making by plans. This includes requiring insurers to provide detailed clinical reasoning to justify use of the management tool. Additionally, the introduced legislation looks to mandate clear timelines for the processing of medical exemptions and appeals. But it's unknown whether the bills will ever make it to passage and enactment.
Forbes
30-06-2025
- Health
- Forbes
Physician Perspectives On Prior Authorization Reform
Many physicians believe prior authorization gets in the way of sound patient care. New reforms from ... More the insurance industry aim to address these challenges. Will they make a difference? You learn a lot in medical school. About human biology, medical ethics and how to make a diagnosis. One thing they don't teach you about—but which rears its head all the time in the actual practice of medicine—is prior authorization. Prior authorization is what is known in healthcare as a utilization management tool. Physicians submit requests to insurers, who respond with determinations about whether they will cover the proposed procedures, services, or medications before the patient receives them. The goal is to steer customers toward modalities of care that have been demonstrated to produce the best outcomes at a reasonable cost. During office hours, between procedures, even in the middle of consults—prior authorization is something physicians have to deal with constantly. Last week, amid scrutiny from lawmakers and regulators as well as public outrage over the practice, health insurers working with the trade association AHIP (on whose board I sit as CEO of SCAN Health Plan, a not-for-profit health insurance company) announced a set of voluntary commitments aimed at simplifying prior authorization and 'connecting patients more quickly to the care they need while minimizing administrative burdens on providers.' The commitments include faster turnaround times, greater transparency, and reduced requirements for routinely approved services. These reforms are sensible and—let's be honest—probably overdue. But will they make a difference? 'Administrative Hurdles' Despite its daily impact on the practice of medicine, prior authorization isn't something physicians talk about very much. So, in order to gauge how prior authorization affects their work and their patients and what effect the voluntary reforms might have, I reached out to several colleagues in different specialties to hear their stories about prior authorization. What I heard were honest reflections on their experience with the practice—and an urgent call to reimagine a system that too often gets in the way of care. Jay Patel, an orthopedic surgeon in Orange County, CA, specializing in hip and knee replacements, describes a system that increasingly delays care for no clear reason by putting up 'administrative hurdles to surgeries that are appropriate.' Patel notes that some payers require that he submits imaging reports in separate documents that duplicate the information contained in previously submitted medical records. 'Most of the time there's some minor piece of information they need that's already in the record, and they reflexively approve it.' But not always. And when delays occur, he says, they disrupt care and diminish trust between patients and their doctors. 'Patients often don't understand how the process works,' he says. 'They usually think we dropped the ball because we're the person they can get ahold of.' Patel believes the system could be improved by reducing prior authorization requirements for physicians who consistently provide appropriate care. 'Good actors should be able to request surgery and have it approved.''Delays Matter' A Northern California interventional cardiologist I know sees firsthand how delays in care can lead to worse outcomes. 'For every test, you have to wait a week for authorization,' he says. 'And when it comes to cardiac conditions, delays matter.' He laments that the delays can push patients to seek emergency care when they experience shortness of breath or other symptoms. 'Put yourself in their shoes. When your heart hurts you may be afraid you will die.' He says that some of his patients have decided to go to the emergency room rather than wait for approvals. In these cases, the patients are admitted and treated as inpatients, which he notes is ultimately more expensive for the plan, the patient and the health system in general. The cardiologist also notes that in his field, denials are rare. Though he often has to pick up the phone to advocate for a patient, he says that in 11 years of practice, not once has a health plan denied a procedure that he's called about. Knowing this, he wonders if artificial intelligence or other technologies could offer ways to improve the system. 'There must be ways to optimize this. If they're authorizing the procedure 99% of the time, why can't there be instant authorization?' Internist Jonathan Dinh says insurers often use prior authorization as a 'delay tactic.' He says that in his experience, some payers intentionally make the practice burdensome, knowing that some percentage of physicians will become frustrated and give up on the time-consuming prior authorization process. 'If there's a poor clinical outcome, the health plan maintains plausible deniability. They'll say, 'We never said 'no.' We left the decision strictly up to our providers.'' As an internist and medical group leader in Southern California, Dinh believes that the efficiency of prior authorization reflects the quality of the organization itself. 'In a well-run group, 80% to 90% of requests should be auto approved,' he explains. "The primary function of prior authorization should be to ensure patients are referred to the correct in-network provider, helping them avoid unnecessary medical bills—not to act as a barrier to care." Dinh says delegated models in which payors assign certain administrative and clinical responsibilities—like utilization management, care coordination, and prior authorization decisions—to a provider organization or medical group can reduce the friction of prior authorization. However, he cautions that this model alone isn't enough. "Delegated entities can still improperly delay or deny care. There must be safeguards—such as expedited appeal processes—to protect patients.' Dinh also says that patients often mistakenly blame delays in seeing a specialist due to the prior authorization process when the real underlying issue is a shortage of physicians. "People often blame delays in seeing a specialist on the prior authorization process,' he says. 'But in many cases, referrals are issued promptly—the real bottleneck is a shortage of physicians. Specialists are overwhelmed and simply don't have the capacity to see patients quickly. Of course, any delay in prior authorization only makes the situation worse.' To address the broader issue of physician shortages, Dinh and his colleagues launched a new internal medicine residency program focusing on training more primary care internists. The initiative aims to expand access to care and improve outcomes, particularly in underserved communities. 'A well-trained internist can help offset the shortage of specialists by managing complex conditions at a high level. The true value of a primary care physician emerges when a patient's care requires coordination across multiple specialties. The ability to lead multidisciplinary care while keeping the patient and their family informed is what ultimately drives the best clinical outcomes and enhances patient satisfaction.' A Starting Point When a draft of AHIP's plan initially crossed my desk, I was skeptical. Voluntary reform isn't something that necessarily has a great track record in healthcare. And yet more than 50 plans (including my own) that provide coverage to tens of millions of Americans have signed on and made a public commitment to reform. After speaking to my physician colleagues and hearing their earnest frustrations, there's no doubt in my mind that the system needs reform and the association's proposals—which are not insubstantial and would address many of the problems —are a great place to start. After all, none of the physicians I spoke to are asking for a blank check. They're asking for a system that trusts their judgment, respects their time, and puts patients first. Reforming prior authorization isn't just about efficiency. It's about dignity—restoring it to the people who give care, and the people who need it—and AHIP's plan, acknowledging some of the challenges my physician colleagues face every day, is a meaningful step in the right direction.
Bloomberg
22-06-2025
- Business
- Bloomberg
Health Insurers Pledge to Reduce Red Tape for Care Approval
A group of the nation's largest health insurers agreed to streamline preapprovals for medical care, addressing a controversial process that can result in delays or outright denials of patient treatment. The insurers pledged to reduce the number of procedures that require so-called 'prior authorization,' standardize processes across different plans and ensure 80% of electronic approvals for medical claims are answered in real time. The voluntary changes, which would be implemented on varying timelines by 2027, are set to be formally announced on Monday.
Daily Mail
17-06-2025
- Health
- Daily Mail
The fresh cost of living blow every Australian paying for private health insurance needs to know about
Australians forking out for the highest level of private health insurance cover are facing double-digit hikes to their premiums. Health Minister Mark Butler this year approved a 3.73 per cent average increase in private health care premiums, that came into effect on April 1. But Australians seeking gold cover have been dealt a major cost of living blow with average, annual hospital insurance soaring by 13.8 per cent, or more than three times the government-approved average increase, a Canstar analysis showed. This equates to $442 extra a year for individuals, who are now paying $3,653 a year for the top-tier cover, which typically includes in-hospital procedures listed on the Medicare Benefits Schedule and ambulance cover. Canstar data insights director Sally Tindall said private health insurers were legally allowed to hike their premiums by double-digit figures. 'The government-approved 3.73 per cent premium price rise was always just an average, not a cap,' she said. 'What we can now see is that some policies have risen by up to 13.8 per cent – particularly for those with the top level of cover. 'The reality is, Australians who have the top level of cover have been hit with the highest price hikes.' Canstar calculations showed an individual with gold cover could save $1,296 a year, and slash their annual bill by a third to $2,357 by switching from an average to the lowest-priced product. A family with gold cover could save $2,493 a year, also slashing their annual bill by a third, by switching from an average to a lower-priced product. This would see their annual bill fall from $7,207 to $4,714. 'If you haven't done a health check on your policy since the April price rise, now is the time to do one,' Ms Tindall said. 'Find out exactly how your premium sits against the lower-cost insurers and if there's a cheaper option for the same level of cover, consider making a switch.' Switching to the same cover could also eliminate the long waiting periods to get coverage for elective surgery. 'What a lot of people don't realise is that if you are switching to the exact same level of hospital cover, you will not have to re-serve any additional waiting periods, which minimises the risk,' she said. Private health insurance costs increased by 4.7 per cent for silver cover. This worked out at an extra $83 a year, or $1,838 overall, for a premium product without birth-related services. But the increases were much more moderate for lower levels of cover. Bronze saw a small 1.5 per cent increase, with the $20 annual change taking premium costs to $1,336 for a product offering hospital cover but not benefits for those with children. Basic cover in fact fell by 0.6 per cent or $7 to $1,070, with this product catering to younger, healthier people offering coverage for accidents. While headline inflation has moderated to 2.4 per cent, overall health care costs rose by 4.1 per cent in the year to March. More than half of Australia's 27.3million people are covered by private health insurance, either individually or as part of a family package.
