Medicare Advantage Post-Acute Care Denials — Senate PSI Finds Rising Denial Rates as Insurers Adopt Predictive Tools

Summary

Senate Permanent Subcommittee on Investigations majority staff report 'Refusal of Recovery' (October 17, 2024), based on more than 280,000 pages of documents from UnitedHealthcare, Humana and CVS covering 2019-2022. UnitedHealthcare's post-acute prior-authorization denial rate rose from 10.9% (2020) to 16.3% (2021) to 22.7% (2022) while it automated the process; its skilled nursing facility denial rate in 2022 was nine times its 2019 rate. In 2022 UnitedHealthcare and CVS denied post-acute requests at about three times their overall denial rates, and Humana at more than 16 times. A May 2019 CVS presentation recorded more than $660 million in avoided inpatient facility costs for 2018, mostly from denied admissions. The report does not attribute the rise to the tools: the staff said the data are troubling whether the decisions came from predictive technology or human discretion. UnitedHealthcare told the Subcommittee that its nH Predict algorithm did not make prior authorization decisions about facility admissions. In a separate lawsuit over UnitedHealthcare's use of nH Predict (Estate of Lokken v. UnitedHealth Group, D. Minn.), where the court records that UnitedHealthcare denies any use of the tool, the court on February 13, 2025, dismissed most claims as preempted but allowed the breach of contract and good-faith claims to proceed; the plaintiffs' class certification motion is due by February 16, 2027.

Consequence

• In the related Lokken suit, breach of contract and good-faith claims against UnitedHealthcare allowed to proceed (February 13, 2025); class certification motion due by February 16, 2027

Who caught it Legislative oversightFound outside the organization

Key dates

1. October 17, 2024Event
2. October 16, 2026Checked against sources
3. October 18, 2026Checked against sources
4. October 21, 2026Checked against sources

Developments are added when the record is reviewed. Next review: October 16, 2027.

Evidence

Each passage is quoted from its source. The quoted passages are re-checked against the live pages every month.

1. Refusal of Recovery: How Medicare Advantage Insurers Have Denied Patients Access to Post-Acute Care : Majority Staff Report

   Supports: report title and publisher

   Refusal of Recovery: How Medicare Advantage Insurers Have Denied Patients Access to Post-Acute Care (Majority Staff Report) U.S. Senate Permanent Subcommittee on Investigations (via GovInfo) Primary source

2. UnitedHealthcare's prior authorization denial rate for post-acute care surged from 10.9 percent in 2020, to 16.3 percent in 2021, to 22.7 percent in 2022.

   Supports: denial-rate findings; the report also supports the Humana, CVS and nine-fold SNF figures

   the data obtained so far is troubling regardless of whether the decisions reflected in the data were the result of predictive technology or human discretion

   Supports: the report does not attribute the rise in denials to the tools

   the algorithm did not make prior authorization decisions about facilities admissions

   Supports: UnitedHealthcare's position, as told to the PSI, on nH Predict

   Refusal of Recovery (full report PDF, 17 October 2024) U.S. Senate Permanent Subcommittee on Investigations (via GovInfo) Primary source

3. Plaintiffs’ claims for breach of contract and breach of the implied covenant of good faith and fair dealing, however, survive preemption

   Supports: contract and good-faith claims allowed to proceed

   DATED: February 13, 2025

   Supports: date of the order

   UHC denies any use of nH Predict.

   Supports: UnitedHealthcare's position in the lawsuit, as the court records it

   Estate of Gene B. Lokken et al. v. UnitedHealth Group, Inc. et al., No. 23-cv-3514 (D. Minn.), Memorandum Opinion and Order on the motion to dismiss (Doc. 91) U.S. District Court for the District of Minnesota (copy hosted by the Georgetown Health Care Litigation Tracker) Primary source

4. The deadline for Plaintiffs’ motion for class certification and any Daubert motions related to class certification is reset to February 16, 2027.

   Supports: class certification motion due February 16, 2027; no class certified yet

   Estate of Gene B. Lokken et al. v. UnitedHealth Group Inc. et al., Order on the joint motion to amend the scheduling order (Doc. 211) U.S. District Court for the District of Minnesota (copy hosted by the Georgetown Health Care Litigation Tracker) Primary source