Medicare Advantage Enrollees face Higher Likelihood of Hospital Care Denials

February 21, 2023
by Diane Archer
Paige Minemyer reports for Fierce Healthcare that hospitals treating Medicare Advantage enrollees faced a higher likelihood of claim denials last year than the year before. Medicare Advantage plans, administered by private health insurers, use tools that limit coverage for inpatient hospital care more often than traditional Medicare.
In 2022, there was an 18.5 percent increase in Medicare Advantage hospital inpatient claim denials over 2021. All in, the Medicare Advantage plans denied nearly six percent of inpatient claims. People in Medicare Advantage plans won’t have to pay for care that their Medicare Advantage plans deny but, because of these denials, they are likely to face more instances in which hospitals refuse to provide them with the care their doctors say they need; the hospitals need to protect themselves financially.
The Medicare Advantage inpatient claim denials can hit hospitals hard. They are not getting paid for the services they delivered. As a result, they also affect the care patients in Medicare Advantage receive. The hospitals can appeal the denials and likely win, if they are willing to expend the time and energy. However, the hospitals’ easiest response to these denials is to not provide the care they believe their patients need.
Hospitals that deliver care to Medicare Advantage patients that the Medicare Advantage plans don’t end up paying for have to eat the bill. In 2022, hospitals wrote off 8.5 percent of revenue. Few hospitals can afford to do that. The 8.5 percent write off is nearly 4 percent more than in 2021, when they wrote off 4.7 percent.
Last year, hospitals wrote off a total of nearly 6 percent of inpatient revenue. In 2021 they wrote off 3.6 percent of inpatient revenue.