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Some Medicare Advantage (MA) plans do not intend to abide by the that prohibits them from denying coverage of services that traditional Medicare would cover. Instead, the private plans are using their own rules or terminology to block or delay inpatient care doctors say their patients need, circumventing the federal agency's intentions.

Those are among concerns the (AHA) and the (FAH) expressed last week in letters to CMS based on reports from their members. The organizations are pleading with the agency to tighten some of the language in the rule and enforce provisions that restrict how MA plans can delay or deny coverage.

Retroactive Appropriateness Determinations

Their key issue deals with the "two-midnight" rule, a decade-old Medicare policy that says a hospital is entitled to reimbursement for an inpatient stay if the admitting physician at the time had a reasonable expectation that the patient was sick enough to need acute care spanning two midnights.

"We hear reports from our members about patients who are staying in the hospital receiving inpatient care for 3, 4, 5, 6 and sometimes more days," Michelle Millerick, AHA's senior associate director of health insurance coverage, said in an interview with 乌鸦传媒. "Then, that the plan retroactively is coming back and saying no. Even though you provided a number of days' worth of inpatient care, that actually didn't meet the criteria for inpatient care; and so we're only going to pay you for observation."

An observation stay pays the hospital substantially less than an inpatient stay.

As evidence, the AHA and the FAH noted that UnitedHealthcare, the largest MA provider, saying that in 2024 (after the CMS policy goes into effect) it plans to continue using its own internal coverage criteria in deciding to pay a claim.

"United is saying it's going to use the 'two-midnight' rule, but it's also going to apply its own internal coverage criteria, specifically InterQual, to evaluate whether the physician's judgment -- that the care would extend beyond two midnights -- is reasonable," Millerick said.

InterQual is a proprietary tool licensed to hospitals to determine appropriateness of inpatient care and licensed to other entities for medical review of that care.

Opaque Determination Tools

According to CMS rules, such private tools can only be used when Medicare coverage criteria has not been fully established, and those circumstances are very limited, Millerick said.

Terrence Cunningham, AHA's director of administrative simplification policy, said the additional clinical criteria an MA plan may impose could be a vital sign threshold or any other clinical criteria that each MA plan develops on its own.

"I think that's what this rule is trying to reel in," he said. Cunningham and Millerick made their comments in a phone call during which an AHA public affairs representative was present.

Tools like InterQual or MCG Care Guidelines (formerly Milliman Care Guidelines) use unpublished evidence to set policies for coverage that hospitals don't get to see, the AHA said. "These types of evidence have not undergone peer-review [and] are not transparent."

A spokesperson from MCG disagreed, saying that, "While MCG care guidelines are proprietary, the evidence for them is most definitely peer-reviewed, and we list our evidence summaries within each guideline."

The AHA letter said use of these guidelines is specifically prohibited by the CMS rule, which says, "Evidence that is unpublished, is a case series or report, or derived solely from internal analyses within the MA organization, or that does not comply with the standards as described in the regulation would not represent proper justification for instituting internal coverage guidelines that would restrict access to care."

Not only does the process cause financial and emotional stress to plan enrollees, but also adds strain in the medical system. In a November 2022 , the AHA noted its survey in which 772 hospitals said they'd lost more than $6 billion due to unpaid or delayed claim payments.

"Some commercial insurer policies and practices appear designed to simply create barriers to appropriate payment. They also contribute to clinician burnout and significantly drive up administrative costs for the health care system," the report said.

Additional Concerns

A third issue has to do with some plans' practice of basing two-midnight rule coverage decisions not just on what an admitting physician thought about the patient's need for hospitalization at the time. They go one step further. An Aetna policy, the AHA letter said, allows the plan to set a more stringent standard that takes into consideration "what the physician reasonably should have known or reasonably should have expected at the time of admission."

This, the AHA said, "could be used to justify denials of inpatient care that would have been covered under Traditional Medicare," and is against the spirit and intent of the CMS rule.

A fourth issue outlined in an to the agency has to do with new terminology that some MA plans have introduced to deny care. Instead of saying that the service was not medically necessary, denial letters are saying that the denial is part of a "payment integrity administrative review."

"It is unclear to us how such an audit -- which is determining whether inpatient care was appropriate -- would not be a level of care or medical necessity review," the AHA letter said. This terminology change "is intended to circumvent CMS rulemaking under the auspice that this is a payment issue not subject to CMS interference, as opposed to a coverage determination," it said.

Millerick explained that the new CMS rule specifies a number of new MA plan requirements for reviewing prior authorization requests for hospital services. So instead of saying that the denial is based on a medical review, which may not be allowed under the new rule, "they're saying this is a payment integrity issue, because that's an area that is outside the jurisdiction of where CMS has the authority to intervene."

The fifth major issue is the AHA's concern that CMS may not be forcefully investigating MA plans' compliance with its new rules. "I think everybody would acknowledge that it is unreasonable and probably not the best use of taxpayer dollars [for CMS] to investigate every single denial," Molly Smith, the AHA's group vice president for public policy, told 乌鸦传媒. "But we really need to identify where there are outliers that suggest ... a systemic problem and start there."

CMS can impose civil monetary penalties and even restrict enrollment if plans violate the rules, she noted.

Smith said that while more than half of all Medicare beneficiaries are now enrolled in a MA plan and that growth is expected to continue, "the resources to monitor [MA plan compliance] have not kept up."

Asked for a response, a CMS representative said the agency has "received and is reviewing the letter and will respond directly to the stakeholder."

UnitedHealthcare did not respond to a request for comment by press time.

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