Seventeen percent of initial Medicare Advantage claims are denied, but 57% of originally denied claims are ultimately overturned, according to a study published June 2 in Health Affairs.
The study analyzed 270 million claims from 2019 based on data from Inovalon, which covered about 30% of the total MA market. The data spanned multiple MA plans and included inpatient, outpatient, professional, and postacute care claims.
On a dollar-weighted basis, denied claims resulted in a 7.2% net loss of the total billed amount for providers.
Denial rates varied by the type of care, with outpatient claims seeing the highest initial denial rate of 21.1%, followed by inpatient and physician claims at 17.3% and 14.6%, respectively. For outpatient claims, there was an 8% net claims loss after considering overturned denials.
The study also found disparities in denial rates based on member demographics. Black beneficiaries had an initial denial rate of 22.7%, and Hispanic beneficiaries had a 20.1% initial denial rate. In comparison, Asian beneficiaries had a 16.4% rate and White beneficiaries had a 15.3% rate.
PPO plans saw slightly lower rates of initial denials and higher net revenue losses for providers compared to HMO plans.
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