Many private health insurers require medical providers to get approval before administering treatment, sometimes resulting in delayed or denied care for patients.
Now, that tactic, known as prior authorization, could be more prevalent in Ohio Medicare, the federal insurance program for seniors and people with disabilities.
Ohio is one of six states involved in a pilot program to use artificial intelligence to determine approval for around a dozen procedures – something that historically hasn’t existed in Medicare coverage.
The Wasteful and Inappropriate Service Reduction Model is set to begin in Ohio in January and is expected to last for six years. Proponents say it could help eliminate wasteful spending within Medicare, while critics worry the model incentivizes the denial of patient care.
Reed Ableson, a health reporter with the New York Times, reported on the program. She sat down with The Ohio Newsroom to share her reporting.
This interview has been lightly edited for brevity and clarity.
On how Medicare will change for Ohioans
“[In] traditional Medicare … there’s a small section of services that they're going to use this new AI prior authorization technique. And normally, people with traditional Medicare have very little in the way of prior authorization. So, it brings that to people in Ohio for the first time with a fairly small group of services.”
“But also in that the AI companies, or the companies responsible for doing the prior authorization, are incented because they get a share of the savings. So if they essentially deny what they say is unneeded care, they would get a percentage of those savings.”
The argument for adding prior authorization
“The argument is that there are examples of services that people get that are unnecessary and sometimes even harmful. And my colleagues at the New York Times have written about, for example, skin substitutes, these really sort of almost pricey Band-aids of sorts. But there have been some people who haven't done well with them and they're very, very costly. So the argument is, if you could use prior authorization on this, you could crack down on overuse of these sorts of new kinds of therapies that really don't benefit patients but cost a lot of money.”
On what critics are saying
“One of the things about traditional Medicare is that it isn't supposed to be exactly like the alternative, which is the insurance-run Medicare Advantage program [which includes prior authorization]. So I think one of the concerns is people have chosen the government program and now some of the advantages of the government program aren't gonna be there.”
“I think the second thing that they're worried about is that there is so much concern about prior authorization and whether it's overused. I mean, the sad fact is that even people who really do need the care, sometimes don't appeal these decisions. They think that they're final. There's just so much concern generally over prior authorization that people, many critics of this new program don't wanna see it introduced to traditional Medicare.”
On concerns with artificial intelligence
“The concern is that it's done automatically and it's at such a scale that you don't really have anyone actually focusing on whether this individual person needs this care. Now, the insurers would argue that the AI is just a first step, human beings are gonna be involved in the process, and Medicare officials insist that's true too. But I think that it's the scale and sort of the ease with which you can deny care or delay care that makes people nervous.”
On pushes to reform prior authorization
“I confess that I was surprised by the administration's decision to do the pilot because there's such widespread bipartisan concern over whether prior authorization is being misused and is preventing at least some people who need care from getting it quickly or getting it at all. I think the administration has said it is taking steps to sort of push the insurers to reform some of their prior authorization tactics: making the decisions more quickly, making it easier to tell what's going on. But I think this is a little bit of a contradiction. And so I think it's going to be interesting to see how it plays out.”
