The fundamental question must be asked, “Where is CMS?”

There is no question that managed care (MC) plans have become the bullies in the healthcare system, and the Centers for Medicare & Medicaid Services (CMS), by providing guidance language that primarily discusses enrollee rights, has empowered these health plans to use such language to their advantage – and to the disadvantage of providers, including hospitals.

A good example is the appeal rights CMS provides to enrollees (up to five levels, with proper representation, if needed) – and yet, hospitals and other providers only enjoy appeal rights outlined in their contracts with the MC plans. Medicare enrollees can file grievances directly with the health plans, but providers, including hospitals, are bound to these contractual provisions.

The CMS two-midnight rule and the inpatient only list were established with what CMS determined was “best for Medicare beneficiaries” (i.e., intended to limit the financial burden of observation status, because the inpatient setting was best for the elderly and disabled undergoing certain surgical procedures), and yet we have health plans that are allowed to decide not to follow either regulation.

More recently, there are health plans conducting short-stay audits and rescinding prior authorization approvals, because the members recovered within a short period of time. In this latter situation, where is the important requirement that patients be informed up front that they are being admitted as inpatients, and not under observation?

CMS guidelines caution payers such as MC plans against “interfering” with the patient-doctor relationship. When an inpatient admission recommended and prescribed by a treating physician for a patient in obvious septic shock is denied by an MC plan as “not medically necessary” because the patient’s temperature is only 100.1, and their criteria states that the patient’s temperature should be a minimum of 100.4, is that not an interference with the patient-doctor relationship? When a doctor or hospital must go through many hoops to get a procedure approved for a patient, is that not “interference”?

The original intent by CMS to establish MC plans was to facilitate the administration and management of healthcare benefits to Medicare beneficiaries; initially, it was a noble exercise of fiscal responsibility, meant to conserve healthcare dollars. Over the years, however, it appears that MC plans have evolved to be nothing more than money-making ventures, run at the expense of healthcare providers.

It is not surprising, although nevertheless alarming, that while many of the larger MC plans continue to post millions in profits year after year, 892 hospitals are currently at risk for closure (according to Becker’s Hospital CFO Report, published March 2022) across the nation, most of them rural hospitals that do not have the resources to staff a denials team or an appeals team of 4-8 people.

Such a sad state of affairs!

With many MC plans now delegating prior authorization work to third-party entities (one MC plan delegates prior authorizations to four different companies, depending on the type of service or system involved, i.e. musculoskeletal, nursery, cardiology, or special procedures), the healthcare system has become one big pie – everybody wants a piece of it, and MC plans get the bulk of it. It seems like the more changes come out, the more convoluted the healthcare system becomes – and healthcare providers are left scrambling for help just to get proper reimbursement.

The administrative burden on healthcare providers in dealing with prior authorization requirements, referral requirements, egregious denials, and technical denials is tremendous, and CMS, while quick to penalize hospitals for not meeting standards and/or for high readmission rates, appears to have turned a blind eye to the pain and hardship of healthcare providers.

Sadly enough, the enrollees themselves do not really know what is going on behind the scenes; all they see are these expensive advertisements that entice them to enroll in managed care plans.

Since when did CMS lose sight of “what’s best for the patient” when it comes to managed care plans?

Disclaimer: The opinions expressed above are my own and do not reflect the opinions or ideas of my employer.

Share This Article

Facebook
Twitter
LinkedIn
Email
Print