Eric and Rebecca Tennant of Bridgeport, West Virginia, fought for months to get Eric’s cancer treatment approved by his insurer. When West Virginia’s Public Employees Insurance Agency eventually reversed the denial in May, Eric had become too sick for the procedure. Health insurers issue millions of denials every year.
Many patients find themselves stuck in a convoluted appeals process marked by long wait times, frustrating customer service encounters, and decisions by medical professionals they’ve never met who may lack relevant training. Recent federal and state efforts, as well as changes undertaken by insurance companies themselves, have attempted to improve a 50-year-old system that disproportionately burdens some of the sickest patients at the worst times. Yet many doctors complain that insurance denials are worse than ever as the use of prior authorization has ramped up in recent years.
When the Tennant family was told histotripsy would cost $50,000 and insurance wouldn’t cover it, they appealed the denial four times. “It’s a big mess,” said Rebecca Tennant, who described feeling like a pingpong ball, bouncing between the insurer and various health care companies involved in the appeals process. “There’s literally nothing we can do to get them to change,” she said in an April interview.
“They’re, like, not accountable to anyone.”
The fatal shooting of UnitedHealthcare CEO Brian Thompson prompted both grief and public outrage about the ways insurers deny treatment. Republicans and Democrats agree prior authorization needs fixing, but patients are growing impatient. Prior authorization varies by plan but often requires patients or their providers to get permission before filling prescriptions, scheduling imaging, surgery, or an inpatient hospital stay, among other expenses.
The practice isn’t new. Insurers have used prior authorization for decades to limit fraud, prevent patient harm, and control costs.
Patient denials frustrate treatment efforts
In some cases, it is used to intentionally generate profits for health insurers. Companies pay less for health care expenses while still collecting premiums by denying costly care. “At the end of the day, they’re a business and they exist to make money,” said Jay Pickern, an assistant professor of health services administration at Auburn University.
For most patients, the process works seamlessly. Prior authorization mostly happens behind the scenes, almost always electronically, and nearly all requests are quickly, or even instantly, approved. But the use of prior authorization has also increased in recent years.
That’s partly due to the growth of enrollment in Medicare Advantage plans. Some health policy experts also point to the passage of the Affordable Care Act in 2010, which prohibited health insurers from denying coverage to patients with preexisting conditions, prompting companies to find other ways to control costs. New federal rules to modify prior authorization are set to take effect next year, with the aim of streamlining the process, reducing wait times, and improving transparency.
These changes were supported by AHIP, a trade group that represents health insurers. But the new federal rules won’t prevent insurance companies from denying payment for doctor-recommended treatment, and they apply only to some categories of health insurance, including Medicare Advantage and Medicaid. Nearly half the U.S. population is covered by employer-sponsored plans, which remain untouched by the new rules.
For some patients, the stakes couldn’t be higher. In May, Sheldon Ekirch, 30, of Henrico, Virginia, said her parents withdrew money from their retirement savings to pay for crucial treatment after her insurance denied coverage.
