The Senate Homeland Security Permanent Subcommittee on Investigations (PSI) released a report on Thursday revealing that the nation’s three largest Medicare Advantage (MA) insurers have significantly increased the rate at which they denied seniors’ post-acute care from 2020 to 2023. This includes denying access to nursing homes, inpatient rehabilitation facilities and long-term acute care hospitals. The report illustrates how insurers use unregulated algorithms and technologies to increase prior authorization denials.

In May 2023, PSI launched an inquiry into the barriers facing seniors enrolled in MA in accessing care. The subcommittee obtained documents and information from the three largest MA insurers: UnitedHealth Group’s (NYSE: UNH) UnitedHealthcare, Humana (NYSE: HUM) and CVS Health’s (NYSE: CVS) Aetna, which cover nearly 60% of all MA enrollees. The report revealed how MA insurers intentionally use prior authorization to boost profits by targeting critical stays in post-acute care facilities.

“The report today puts an exclamation point on what we’ve been saying for a long time,” Federation of American Hospitals (FAH) President and CEO Chip Kahn said in a statement. “Patients are being hung out to dry by MA plans’ delays and denials. It’s past time for legislators and regulators to hold plans accountable and protect patient care.”

Founded in 1966, the Washington D.C.-based FAH represents more than 1,000 tax-paying community hospitals and health systems throughout the U.S. with a mission to advance public policy and ensure patients and communities have access to high-quality, affordable health care.

Importantly, home health providers have consistently had the same issues with MA plans.

Some of the report’s key findings highlight concerning practices.

In 2022, UnitedHealthcare and CVS denied prior authorization requests for post-acute care at rates nearly three times higher than the companies’ denial rates for all prior authorization requests, according to the report. In 2022, Humana denied prior authorization requests for post-acute care at a rate more than 16 times higher than its overall denial rate.

UnitedHealthcare’s prior authorization denial rate for post-acute care jumped from 10.9% in 2020 to 22.7% in 2022, mainly due to an automation project.

Humana’s denial rate for long-term acute care hospitals grew by 54% between 2020 and 2022.

Facing pressure to cut costs in the MA division, CVS deployed post-acute analytics in April 2021, using artificial intelligence (AI) to reduce the amount of money spent on skilled nursing facilities. CVS expected to save about $4 million per year, but within seven months, the company projected that the expanded version of the initiative would save more than $77 million over three years. It was revealed that CVS saw a consistent correlation between increasing prior authorization requirements and expanded savings.

The report shows that MA plans use various mechanisms, from initial denials based solely on AI-driven algorithms to increased requests for prior authorizations and shorter durations of care approved, to control the amount of service they provide and reduce costs. In doing so, they profit at the expense of older adults and the providers caring for them.

“This report provides valuable substantiation of the concerns and issues we’ve shared – repeatedly – with the Centers for Medicare & Medicaid Services (CMS), members of Congress, and other stakeholders,” LeadingAge President and CEO Katie Smith Sloan said in a press release. “Its data on denials of MA plans’ prior authorization requests for post-acute care, occurring at rates far higher than other types of care, and the increase in the number of post-acute service requests that are subject to prior authorization, validate our nonprofit and mission-driven provider members’ experiences.”

LeadingAge, based in Washington, D.C., represents more than 5,400 nonprofit aging services providers and other mission-driven organizations.

PSI continues to investigate the use of predictive technologies by MA insurers.

However, based on this report, the subcommittee recommended that CMS begin collecting prior authorization information broken down by service category, conduct targeted audits to determine if insurer prior authorization data reveals increases in adverse determination rates, and expand regulations for insurers’ use management committees to ensure that predictive technologies do not have undue influence on human reviewers.

“The plans’ behaviors revealed in this report, including their avoidance of provider engagement by instructing employees to withhold information on authorization decision-making and by restricting communication to online portals, as well as their strategic, deliberate decisions to grant or deny prior-authorization requests, cannot and should not continue,” Smith Sloan said.