Bloomberg Law: Medicaid Advocates Decry Coverage Denials for Poor in Report (July 25, 2023)

Medicaid advocates are sounding the alarm over systemic oversight failures and misaligned incentives that allow Medicaid managed care companies to restrict patient access to health-care services.

The Department of Health and Human Services Office of Inspector General found that 37 states it surveyed had systemic problems with their prior authorization processes, leading to inappropriate denials of coverage. These problems included not informing Medicaid patients of their right to appeal a denial, allowing insufficiently trained staff to make prior authorization decisions, and writing notices in ambiguous, often hard-to-understand language that missed or concealed important information such as the reason for a rejection.

Amber Christ, an attorney at Justice in Aging, an organization that advocates for seniors struggling with poverty, says managed care organizations are able to get away with these practices because of the converging interests between state Medicaid agencies and the insurance companies they contract with to provide health coverage.

“There’s a fiscal incentive for the state Medicaid programs to not do an enormous amount of oversight of managed care plans because it’s saving state budget dollars.”