Responding to calls for greater transparency, the Government Accountability Office (GAO) released a report illustrating challenges with Medicaid Managed Care Organizations’ (MCOs’) prior authorization grievance and appeals processes, and made recommendations for improvements.
As a tool to protect consumers, managed care enrollees are allowed to appeal prior authorization denials or file grievances, if necessary. The Centers for Medicare & Medicaid Services first began tracking data on beneficiaries’ grievances and appeals in 2022, but according to the GAO’s report, this data is often incomplete. Most importantly, CMS does not collect data on the outcomes of prior authorization appeals or the number of denials made by MCOs, according to the GAO, which can hamper regulators’ ability to make meaningful changes to the managed care program. Many home care recipients receive coverage from Medicaid MCOs.
Lawmakers raised similar concerns following a July report by the Office of the Inspector General, which found that Medicaid MCOs denied roughly 1 in 8 prior authorization requests in 2019, or about 2.2 million denials. In October, Sen. Ron Wyden (D-OR) and Rep. Frank Pallone, Jr. (D-NJ) sent letters to seven major MCOs seeking an explanation for these high rates of denials. The GAO’s report, released March 14, was addressed to Wyden and Pallone.
“Appeals and grievances data is an important new resource for CMS to enhance oversight and transparency in managed care,” GAO wrote in its report. “CMS’s decision not to collect data on appeal outcomes or the number of denials made by managed care plans weakens its ability to attain a complete picture of plan performance, including potential problems with quality or access.”
Without this information, CMS cannot effectively use its grievance and appeals data to improve MCOs’ performance, GAO noted. The office recommended CMS require states to report their MCOs’ appeals outcomes and the number of prior authorization denials, and asked CMS to publicly release a plan to use appeals and grievance data to enhance Managed Care oversight.
In a response to the report, the Department of Health and Human Services agreed with GAO’s recommendations and said it would include appeals outcome data in the future.
