Medicare Advantage Plans Often Inappropriately Deny Access to Skilled Nursing Care

A new report from the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG)—a watchdog agency— finds Medicare Advantage (MA) plans overturn nearly all (95%) prior authorization denials for admission to skilled nursing facilities (SNFs). This could indicate a harmful and widespread pattern of denying medically appropriate care.

Prior authorization is a plan-imposed restriction that requires a beneficiary, usually through their provider, to obtain advance approval for a service to be covered. Intended to promote the delivery of high-value care, previous OIG work suggests it can be misused and otherwise interfere with medically necessary treatments, potentially worsening enrollee health. OIG has identified denials of prior authorization requests for SNF admission—where beneficiaries receive skilled post-hospital services such as medication administration, tube feedings, and wound care—as a particular area of concern. This report explores those findings.

Previous OIG work suggests prior authorization can be misused and otherwise interfere with medically necessary treatments.

The MA Payment Structure

Medicare pays Medicare Advantage (MA) plans a fixed monthly rate for each enrollee, and the plans pay providers to deliver care. As a result, MA plans receive the same amount each month, regardless of how much care their enrollees use. The OIG report notes that a central concern about this structure is that it may incentivize “insurers to deny enrollees’ access to services in an attempt to increase profits.” The consequences are significant: “Inappropriate denials of care can have serious impacts for enrollees’ health, and MAOs [Medicare Advantage organizations] that inappropriately deny care are not delivering the full value that taxpayers pay them to provide.”

OIG Findings

Overall, MA plans denied 12% of requests for SNF admission. However, people living in nursing homes had much higher denial rates (40%) than people in other settings.

Enrollees and their providers appealed 18% of SNF denials with a staggering 95% success rate. According to OIG, this “extremely high overturn rate indicates that some enrollees were initially denied medically necessary care and raises concerns about denials that were not appealed.”

Even successful appeals come at a cost, including care delays.

Even successful appeals come at a cost, including care delays. Enrollees who appealed had to wait around six days for a decision, with many (17%) waiting 10 days or more. OIG explains this can lead to delayed discharges and avoidable hospital stays, as people often remain in the hospital while they await their plan’s decision. These extra days can increase costs for hospitals, enrollees, and the program as well as “negatively affect patients’ psychological and social well-being and contribute to feelings of uncertainty and stress about their recovery and prognosis.”

For-profit plans were more likely than non-profit plans to deny SNF access, suggesting “that financial incentives may be partially driving higher denial rates among some MAOs.” OIG reiterates that MA plans “have a financial incentive to deny SNF-level care and instead approve a lower level of care, such as home health services or outpatient therapy.”

Almost all (97%) of NaviHealth’s SNF denials were overturned on appeal.

The contractor NaviHealth, a UnitedHealth Group subsidiary, processed half of all requests for SNF admission and denied 14% of them, a higher rate than plans that processed requests internally (11%) and other contractors (9%). Almost all (97%) of NaviHealth’s SNF denials were overturned on appeal, raising “concerns about whether contractors are receiving appropriate training and oversight.” A new STAT news report offers additional context, explaining that “NaviHealth uses artificial intelligence to examine people’s care needs and was the focus of a STAT investigative series in 2023 that found its denials often resulted in poor outcomes for desperately ill patients.”

Beneficiary Impacts

Coverage denials that result from prior authorization can impede timely access to care by forcing beneficiaries to choose between seeking other treatments, paying out–of–pocket, going without, or getting embroiled in the daunting MA appeals system.

Reports consistently indicate inappropriate denials unnecessarily force millions of beneficiaries into this cycle each year. This echoes our own experiences. Last year, as in previous years, questions about denials accounted for nearly one-third of all calls to the Medicare Rights helpline. Callers are often struggling with what to do next, from trying to unpack confusing plan communications to navigating the complex MA appeals process.

Too often, there is not a simple solution. Appealing coverage denials is burdensome and time-consuming. Medicare Rights frequently hears from people who don’t know how to begin and from those who can’t; they don’t have time to wait for care or wade through what might be a thicket of denials across their care.

Opportunities for Reform

As outlined below, there are opportunities to reform the current system to reduce not only inaccurate denials but also the likelihood that an enrollee will need to file an appeal in the first place. Changes to the enrollment process and plan landscape, as well as better plan oversight and more transparency, would improve the coverage environment, while simplifying the appeals system and leveling the playing field between MA and Original Medicare (OM) would improve how enrollees experience their coverage. 

Modernize Enrollment and Plan Selection. One commonsense solution is to make the MA plan selection easier and less risky by ensuring that all plans are high-quality and that beneficiaries are maximally empowered to make informed decisions, both initially and annually. This includes standardizing and limiting plan options, having Medicare notify people approaching eligibility about their rights and responsibilities (as outlined in the BENES 2.0 Act), adequately funding State Health Insurance Assistance Programs (SHIPs) to meet growing needs for unbiased Medicare outreach and enrollment counseling, and modernizing Medicare Plan Finder. 

Enhance Transparency, Oversight, and Enforcement. To meaningfully and optimally improve the current system, we need more data and complete transparency about plan practices and outcomes around utilization management and appeals, as well as accurate, understandable resources to help enrollees and other stakeholders work within these structures. More clarity would also enhance plan accountability and allow the Centers for Medicare & Medicaid Services (CMS) to design oversight mechanisms and enforcement strategies that target evolving plan behaviors and best encourage accurate initial coverage determinations.

More clarity would enhance plan accountability and allow CMS to design oversight mechanisms and enforcement strategies.

Stronger plan guardrails and consumer protections are also needed. CMS must fully curb plan practices that undermine informed decision-making, like error-riddled provider directories, blanket denials, opaque enrollee communications, empty supplemental benefits, and predatory marketing tactics. Successful implementation and oversight will require adequate funding to support CMS staff capacity and activities.

Simplify Appeals. Avoidable denials are problematic on their own, but the associated harms often compound because enrollees don’t always know what to do next. Even those who do may not find a timely resolution, given the complexity of the appeals process. Streamlining this system is long overdue. Critical updates include reducing burdens on all involved, automatically escalating certain claims, and limiting wait times for decisions. 

Equalize Coverage. Ultimately, we support making the same benefits and cost protections available to all enrollees. This would help address the problems we see now when beneficiaries want to leave MA for OM but face affordability barriers. They may have initially chosen MA for features OM does not offer, like an overall cost cap and supplemental benefits, but find the trade-offs—like limited provider networks and more frequent denials—are no longer worth it as their needs change. Expanding Medigap buying protections would also help, especially in the interim. 

Conclusion

Today’s report builds on evidence showing that although few enrollees appeal, most who do are successful. In 2021, only 11% of denials were appealed, but more than 80% were overturned. A 2022 HHS OIG investigation similarly found that while only 1% of prior authorization denials were appealed, 75% were overturned at the first level of review. In 2025, KFF similarly found that while few people appealed their MA plan’s prior authorization denial, most (82%) were successful.

These remarkably high overturn rates signal serious deficiencies with initial plan decisions.

These remarkably high overturn rates signal serious deficiencies with initial plan decisions. Importantly, a successful appeal is not a magic wand—even reversals come at a cost, including care delays and adverse health outcome. We urge policymakers to enact and enforce meaningful solutions, without delay.

Further Reading

Read the OIG report, Medicare Advantage Organizations Overturned Nearly All Appealed Prior Authorization Denials for Skilled Nursing Facility Admission, Raising Concerns About Initial Denials.

Read more from Medicare Rights about MA enrollee experiences, including with prior authorization and coverage denials.