Flags fly at half mast outside the United Healthcare corporate headquarters on December 4, 2024 in … [+]
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Attacks on UnitedHealthcare business practices in the wake of the assassination of chief executive officer Brian Thompson have swept health insurance companies up in a national imbroglio over how they deny medical care and slow walk approvals of treatments.
To be sure, health insurance companies indeed do “delay, deny and defend” when it comes to patients and doctors submitting claims for everything from surgeries and procedures to drugs and hospitalizations.
But health insurers are typically doing the bidding of the employer who hires them or the government that pays them to administer a pool of money, which are premiums paid by consumers, taxpayers, workers, or employers.
Doctors and hospitals submit claims after treating patients who are also subscribers to these insurance plans. Insurers then make money in part based on what is left unspent in the pool of premiums. And if employers are self-insured, health insurers are also paid administrative fees from employers and governments who buy their services to manage healthcare and manage the pool of employer and worker premium dollars.
What is covered and how much someone pays out of their paycheck or out-of-pocket is calculated by the insurance company working with the employer client. These coverage decisions are never made by the insurance company alone. Or in the case of Medicaid coverage for the poor, what is covered is decided by the state and its lawmakers and possibly governor who hold sway over what each state Medicaid program covers. Almost all states in the U.S. have privatized Medicaid programs administered with the health of insurers like UnitedHealth Group’s UnitedHealthcare, Blue Cross and Blue Shield plans, Centene, Molina Healthcare and an array of others.
And when it comes to Medicare coverage of seniors, the federal government is increasingly stepping back from the health insurance business by handing the administration of elderly beneficiaries and their care to privatized insurers via Medicare Advantage plans sold by dozens of companies that include UnitedHealthcare, Humana, CVS Health’s Aetna, and many Blue Cross and Blue Shield plans.
Despite insurance industry rules that include requirements that patients get prior authorization before medical care can be given or paid for, Medicare Advantage is now more popular than fee-for-service Medicare run by the government.
And it has become bipartisan with Republicans and Democrats supporting Medicare Advantage while the fantasy of single-payer, government-run Medicare becomes less and less likely with each passing Congress and presidential administration. More than half of all Americans who are eligible for Medicare are choosing Medicare Advantage plans and the private insurers who administer them.
Rules endorsed by Republican and Democratic members of Congress and presidential administrations from George W. Bush and Barack Obama to Donald Trump and Joe Biden have supported the march toward Medicare Advantage even as it has become more scrutinized in recent years.
“Data from 2022 showed that 7.4% of all prior authorizations were denied or partially denied,” according to an American Medical Association report, citing data from KFF. “That’s up from the less than 6% of requests denied in each of the years from 2019–2021.”
Meanwhile, private individual coverage under the Affordable Care Act has also experienced record enrollment under the Biden White House, which worked with Congress to pay enhanced subsidies for more Americans to afford individual Obamacare coverage under the Affordable Care Act.
But looming large is the second Trump administration and a Republican-controlled Congress that may not renew the enhanced subsidies when they expire at the end of 2025. In addition, the Trump administration could ease health insurance industry rules that required Obamacare plans to cover certain essential health benefits.
“A pandemic-era boost to ACA marketplace subsidies will expire at the end of 2025, potentially causing premium spikes and coverage losses for an estimated 4 million people if Congress fails to extend the enhanced assistance,” a Commonwealth Fund report said in September.
“When in office, Trump sought to repeal and replace the Affordable Care Act with plans that, according to projections, would increase the number of uninsured to more than 50 million and reopen the doors to preexisting condition denials and exclusions for people buying coverage on their own,” the Commonwealth Fund report added. “His administration also nearly eliminated funding for outreach and enrollment assistance in the marketplaces. A second Trump administration might restart efforts to add work requirements to Medicaid, a policy that led to coverage losses.”
