Study: U.S. health care denials on rise

Karen Bouffard
The Detroit News

Americans increasingly are denied access to treatment by health insurers or pharmacy benefit managers who rely on techniques like prior authorization or step therapy to limit patient’s treatment options, according to a report released Monday.

The Washington, D.C.-based Doctor-Patient Rights Project reviewed research, patient polls, academic literature and primary-source materials such as insurance companies’ prior authorization forms to learn more about how insurers’ “utilization management” methods affect patient treatment.

The study, titled “Access Denied,” found that insurance companies have increased their use of utilization management techniques that are designed to save money — but can sometimes result in negative health outcomes that increase costs down the road.

The nonprofit Doctor-Patient Rights Project is a coalition of doctors, patients and advocacy groups fighting to increase health care access for those with hard-to-treat chronic illnesses.

“There’s a third party in the exam room with the doctor and patient now,” said Seth Ginsberg, co-founder and president of the Global Healthy Living Foundation, one of the groups involved in the Doctor-Patient Rights Project. “It’s the insurance company, it’s the pharmacy benefits manager ... that comes between the doctor and the patient in determining what tests covered, what diagnostics get paid for, what medicines get covered.

“It’s disrupting the way doctors and nurses practice medicine.”

The report follows a poll released by the coalition in August that suggests more than 50 million insured Americans have been denied essential treatments for chronic or persistent diseases, with 2 out of 3 denied multiple times.

Schoen Consulting, a global research firm, polled a representative nationwide sample of 1,500 insured Americans in March about their experiences with insurance companies, with a margin of error of 3 percentage points. Of the patients who said they had been denied coverage for a chronic illness, 63 percent said their denial was based on a utilitzation management technique.

The Access Denied report identified the five primary ways that insurers deny access, starting with overly burdensome prior authorization requirements, where doctors are asked to justify the tests, treatments or medications they prescribe.

Researchers found that the number of treatments requiring prior authorization has been on the upswing. In 2007, for example, Medicaid Part D prescription drug plans required prior authorization for 8 percent of medications, compared with 21 percent of prescriptions by 2013.

The report cited a 2010 American Medical Association survey of 2,400 physicians that found 58 percent had trouble getting approval for at least 25 percent of prior authorization requests for medication. The AMA has expressed concern that the process can result treatments being abandoned or delayed, the report noted.

Other utilization management methods identified by the authors include:

■Step therapy, where patients are required to try a sequence of less expensive drugs before getting the more expensive medicine their doctor prescribed. The analysis cited a 2015 survey by the Pharmacy Benefit Management Institute in which 56 percent of 302 employer-sponsored prescription drug benefit plans surveyed said they had step therapy requirements.

■Formulary exclusions, where drugs aren’t covered if they’re not on a list of pre-approved medications. The report said the number of drugs excluded from the formulary of one pharmacy benefit manager nearly doubled over the past three years. Another pharmacy benefit manager exclusion list grew by 77 percent.

■Non-medical switching, when patients are switched to a different drug because the medicine prescribed by their doctor was taken off the formulary. The report cited a 2016 poll by the Global Healthy Living Foundation and the Tennessee Patient Stability Coalition, that found symptoms worsened for 95 percent of chronic disease patients when their medication was switched.

■Adverse tiering, where most or all of the treatments for an expensive illness are placed on formulary tiers that require higher patient co-pays. As of 2013, according to the report, 80 percent of working Americans had private insurance plans with three or more tiers for drug prices, up from 50 percent in 2000.

Dominick Pallone, executive director of the Michigan Association of Health Plans, said utilitization management practices are often included in health plans at the request of employers.

“It depends on the contract with the employer how aggressively that utilitzation management technique or prior authorization is used,” Pallone said. “Sometimes employers want that used a lot, and we respond to the needs of the consumer marketplace.”

If the treatment is denied, consumers can appeal to the health plan, Pallone added. Once the health plan’s appeals process is exhausted, consumers can appeal to the state regulatory agency. In Michigan that’s the state Department of Financial and Insurance Services.

According to Pallone, Michigan’s appeal process is outlined in the Patient’s Right to Individual Review Act. It follows a model that was codified in the federal Affordable Care Act and has been adopted across the nation, he said.

“That statute lays out a framework and a time line for external appeals, so if you don’t like the decision of the health insurer on any claims decision or prior authorization decision you can appeal it, and your doctor can help you do that, most usually do,” Pallone said, noting the process can be expedited for medical emergencies.

Ginsberg has suffered from spondyloarthropathy, a form of arthritis, since he was a teen. He started Creaky Joints, an online community for people with arthritis, when he was still in college, and later co-founded the Global Healthy Living Foundation.

Ginsberg said said most people feel they’re alone and powerless when battling for health care treatments they need.

“We’re trying to create a conversation around the fact that a lot of people are thoroughly unhappy with their insurance companies and get hurt when their insurance companies (use these methods),” Ginsberg said of the Access Denied report.

“Those of us who are lucky enough to have insurance are in the long run unlucky (when) insurers use these utilization management techniques that will harm us.”