Report Exposes High Rates of Medical Care Denials for Low-Income Individuals

By Consumers for Quality Care, on August 9, 2023

A recent report conducted by the inspector general’s office of the U.S. Department of Health and Human Services found that private health insurance companies contracted by Medicaid are denying numerous medical claims submitted by low-income Americans, with little to no oversight from federal and state authorities, according to The New York Times.

Many insurers implement prior authorization requirements, which are requirements that must be met before the insurer will approve care. While intended to curb unnecessary treatments, these requirements often serve as barriers for consumers seeking the crucial care they need.

Some Medicaid consumers were found to be enrolled in for-profit insurance plans with above-average denial rates, with many greater than 25 percent, such as one plan in Illinois which denied 41 percent of requests for care.

These practices raise concerns that prioritizing profits may come at the expense of providing access to care for the underserved. Medical professionals fear that many Medicaid consumers, faced with hurdles to have their care approved by insurers, will instead put off or skip treatment altogether. “You don’t always have the opportunity to see a patient, send in a prior authorization request and schedule them back in,” said Dr. Matthew Stinson of Springfield, Missouri, who sees many Medicaid consumers. “It’s an access problem.”

The report calls on state and federal regulators to increase oversight when it comes to these denials, writing, “people of color and people with lower incomes are at increased risk of receiving low-quality health care and experiencing poor health outcomes, which makes ensuring access to care particularly critical for the Medicaid population.”

Insurers should not be allowed to arbitrarily deny medical claims, boosting their profits while potentially placing consumers in financial ruin. Policymakers must fix the health care system to ensure all consumers can access the care they need.