AHA supports scrutiny of Medicare Advantage 

WASHINGTON – The American Hospital Association has urged the U.S. Department of Justice to establish a task force to conduct False Claims Act investigations into commercial health insurance companies that are found to routinely deny patients access to services and deny payments to health care providers. 

The AHA’s letter follows a recent report from the Office of Inspector General that found Medicare Advantage organizations are violating their obligation to cover the same services as original Medicare and not to impose additional clinical criteria that are “more restrictive than original Medicare’s national and local coverage policies.” 

“The HHS-OIG report offers several forward-looking recommendations to remedy this serious problem of improper denials,” the letter states. “Those recommendations are sensible, and the AHA applauds them. But they are not enough. It is time for the Department of Justice to exercise its False Claims Act authority to both punish those MAOs that have denied Medicare beneficiaries and their providers their rightful coverage and to deter future misdeeds.” 

The OIG found that 13% of prior authorization denials and 18% of payment denials actually met Medicare coverage rules and should have been granted. 

In a program the size of Medicare Advantage — with 26.4 million beneficiaries, or 42% of the total Medicare population in 2021 — improper denials at this rate are unacceptable, according to the AHA. 

“Yet, as the report explained, because the government pays MAOs a roughly $1,000 per-beneficiary capitation rate, they have every incentive to deny services to patients or payments to providers in order to boost their own profits,” the letter states. “As HHS-OIG’s report shows, this is exactly what certain MAOs have been doing – again and again. And in a $300-plus billion federal program, the losses to the public are immense.”