New analysis highlights commercial health plan abuses that restrict coverage, increase clinician burnout

NEW ANALYSIS HIGHLIGHTS COMMERCIAL HEALTH PLAN ABUSES THAT RESTRICT COVERAGE, INCREASE CLINICIAN BURNOUT

COVID-19 Pandemic Sheds New Light on Gaps in Essential Health Care for Insured Americans and Burden on Caregivers

 
WASHINGTON (December 3, 2020) — A new analysis prepared by the American Hospital Association (AHA) and released today highlights commercial health insurance practices that contribute to burnout in the clinical workforce and make it more difficult for some Americans to access the care they need.

While these findings pre-date the COVID-19 public health emergency, the need to resolve them has become increasingly urgent as staff shortages have reached their highest level to date during the pandemic.

The report highlights the adverse impact of the rise in prior authorization and inappropriate reimbursement delays and denials. Under prior authorization, a provider requests approval for coverage from the health plan before delivering a treatment or service. The practice is designed to ensure patients receive the right care in the right place, especially when a therapy is new or high-cost. However, health plans have expanded their use of prior authorization to apply to a wide range of routine services, including areas where treatment has not changed and there is no evidence of abuse.

The unnecessary application of prior authorization can lead to higher costs, delays and decreased quality in patient care and increased burden on staff, the report shows. The National Academies of Medicine has identified burnout as being associated with “burdensome administrative processes which divert clinicians’ attention away from patients and detract from patient care.” Prior authorization is one of the practices most frequently cited by clinicians as contributing to burnout.

The number of U.S. nurses reporting symptoms related to burnout has risen to 62 percent, according to a recent national survey conducted by the American Nurses Association.

Examples of heavy administrative burdens from the report include:

• One 17-hospital system spending $11 million annually just complying with health plan prior authorization requirements;
• A single 355 bed psychiatric facility requiring 24 full-time staff to deal with authorizations; and
• A large, national system spending $15 million per month in administrative costs associated with managing health plan contracts, including complying with prior authorization requests.

Inappropriate denials also put patients at risk when the treatment declined is medically necessary, according to the report.

“Hospitals and health systems face severe staffing shortages during the COVID-19 pandemic. We cannot afford commercial health plan abuses that deny medically necessary treatment to patients and increase clinician burnout on top of that,” said Rick Pollack, AHA president and CEO. “Caregivers need immediate relief from these excessive burdens so they can focus their attention where it is needed most: caring for patients and saving lives.”

The report identifies a number of solutions at the national level to improve oversight and help build a health system that better serves patients and protects clinicians from burdensome health insurance practices that take them away from patient care. This includes:

• Standardized prior authorization processes to ensure providers are giving health plans the information they need the first time, thus reducing burden and inappropriate denials;
• 24/7 availability of health plan staff to review prior authorization requests;
• Streamlined response timelines so patients do not wait unnecessarily for coverage to be approved;
• Full and complete information from health plans about why prior authorization is denied;
• Financial penalties on health plans for excessive rates of inappropriate denials;
• Review of provider networks to ensure adequacy; and
• Standardized appeals processes that allow for external review.

A full copy of the analysis can be found on the AHA website here.

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