Earlier this year, health insurance plans covering seniors, low-income people and ACA marketplace enrollees were required to officially begin publicly sharing how often they deny prior authorization requests, and how often those denials are overturned after they’re appealed.
And although all that data is now filtering out to consumers in an easily digestible format, the numbers don’t come close to telling the full story of just how big of a problem prior authorization might be.
The data doesn’t tell consumers what kinds of services are being denied or why, it doesn’t require insurers to report in a way that would make apples-to-apples comparisons possible, and it only includes percentages rather than actual counts, meaning a large insurer with a low denial rate could still be denying a huge volume of requests that affect more people than a plan that has a high denial rate but fewer members. Furthermore, insurer gold carding programs, which exempt high-performing providers from prior auth requirements altogether, can skew the numbers even more. And perhaps most importantly, the roughly 150 million Americans who get their coverage through their employer aren’t reflected in the numbers at all, and there’s no current federal proposal to make that data public.
To its credit, CMS has proposed expanding the current reporting requirements to include prescription drugs, and a handful of states have gone further on their own to require some commercial plans to report their numbers.
But even with all those limitations, what the data does show is that denial rates vary widely even among the nation’s largest insurers, and that most denials aren’t getting appealed. When they are, many are subsequently overturned.
A KFF analysis of the first year of reported data from 2025 found that insurers denied between 12% and 18% of prior auth requests across Medicare Advantage, Medicaid managed care and the ACA marketplace. When patients appealed, 67% of MA denials were overturned, 47% in Medicaid and 43% on the marketplace. Centene overturned 93% of its appealed MA denials.
“We are creating massive amounts of waste in our system, and we are controlling cost within the system simply by denying care,” Patrick Quigley, CEO of Sidecar Health, told Becker’s. “It says to me the whole system is set up for an unsustainable outcome, and at some point it has to break, if it’s not already broken now.”
Sidecar Health is a non-network, cash-price insurer that operates in the employer market, covering members across 48 states and selling to companies headquartered in Ohio, Georgia, Florida and Texas. The company doesn’t use prior authorization at all, instead setting fixed benefit amounts based on local market pricing and letting members see any provider. The company is also eyeing the ACA exchanges as early as 2028, after CMS finalized a rule in May that will allow non-network plans on the marketplace.
“As a dad, trying to get my kids’ care, it’s like, I guess it’s not just me,” Mr. Quigley said about the new data. “I thought it was great to put it in black and white, because the rates are massive.”
The data arrives more than a year after the Trump administration brokered a voluntary pledge from around 50 insurers to simplify the prior authorization process. Since then, AHIP and the BCBS Association say those plans have eliminated 6.5 million prior authorizations, representing an 11% reduction in requirements, though the groups did not publicly release the underlying claims data or methodology behind that figure. Overall, the industry has maintained that prior auth is a necessary check on rising costs, and that the majority of services don’t require it anyway.
Starting next year, CMS will implement the strictest provisions of the rule that made the latest denial data public, requiring ACA, Medicaid and MA plans to launch electronic systems that allow clinicians to submit prior auth requests and receive decisions through their existing EHRs. The rule will also require insurers to give patients electronic access to their own prior auth and claims information.
This month, the broader debate moved past the ongoing reform efforts, with the advocacy group American Economic Liberties Project publishing a policy brief that called for an outright ban on prior auth as it currently exists, arguing that the practice has become a “corporate care veto” that exists to boost insurer profits rather than protect patients. The brief cited the administrative burden on the physician workforce, estimating that prior auth consumes the equivalent of more than 99,000 full-time physicians and advanced practice clinicians at a cost as high as $32.7 billion annually.
“The right path is actually to stop and make prior authorization illegal,” Mr. Quigley at Sidecar said. “Why do we need prior authorization at all? Instead, focus on creating transparency around decisions, around costs, around quality, so that people can naturally make better decisions, because that’s going to lower costs.”
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