More Data on Medicare Advantage Denials: OIG Weighs In with 2022 Report

Direct instructions from CMS require that Medicare Advantage cover all services covered by traditional Medicare.   So the simple rule is, if the service gets coverage from Traditional Medicare, you get Medicare Advantage coverage for that service, also.   

(And, normally, that Medicare Advantage payment rate should be the same as traditional Medicare, unless you have negotiated a lower-fee contract - details here).

However, as a consultant, I also warn people that getting that coverage and payment from Medicare Advantage may take a lot of hand-holding or appeals.  And it seems to be focused on labs.  A Health Affairs report earlier this year by Schwartz et al. (here) found that MA plans just denied 1.4% of all claims, but hidden deep in the paper, a huge proportion, like 80-90%, of those denials were lab claims.

Now we have a new 61-page OIG report on MA denials of medically necessary care, as adjucated by physicians hired by OIG.  See the OIG report here, and see coverage at New York Times here.

OIG had 3 recommendations to which CMS concurred.

1. Issue guidance on the use of medical appropriate use criteria for MA plans,
2. Update audits to quantify and enforce action on this problem,
3. Direct MA plans to address their "vulnerabilities" that lead to the excess denials.

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Below, from Schwartz et al 2022, Lab denials (either under MA specific rules (yellow) or under LCD rules enforced by MA plan(blue)) were the vast majority of all types of denials.

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For labs, MolDx has announced it is contracting to share edit protocols with MA plans, which should tighten the linkage between what FFS Medicare covers and what a MA plan covers.