During a House Ways and Means Committee hearing prior to the congressional recess, Rep. Terri Sewell (D-AL) questioned Alignment Health President, Dawn Maroney, on lowering denial rates.
00:00And I'll recognize Ms. Stuhl for five minutes.
00:03Thank you, Mr. Chairman.
00:04I want to thank all of you for being here today.
00:06For me, I represent both an urban area, Birmingham, Alabama, underserved, and a huge swath is rural.
00:16And picking up where my chairman just left, Chairman Smith just left, prior authorization is the number one complaint I hear about.
00:26The number one, and the delays in payment have exacerbated an already financially insecure hospitals.
00:35I represent Alabama that did not expand Medicaid.
00:39My rural hospitals are teetering on the edge.
00:42And when I hear time and time again about pre-authorization, it almost, I mean, it's just, it's mind-boggling that the denial rate is so high.
00:52And I know, Ms. Maroney, you actually said that your denial rate was just 2%.
00:57So can you enlighten me as to how you were able to get your denial rates lower?
01:04Thank you so much for that question.
01:06And we take pride in that.
01:08You know, there are a lot of referrals that people go through that should be auto-approved.
01:14There should be no hold time.
01:16And approximately, probably about 95 to 97% of prior office that come through the system are automatically approved at alignment.
01:25The other thing is, is which I heard a little bit earlier about the prevention component and which is critical.
01:32We have a belief system through our Jumpstart Assessment Program for every new enrollee that enrolls into the program.
01:37It is our goal to see them immediately within the first 90 days or 120 days to make sure that there's no continuity of care issues.
01:46So it sounds like you are trying to, on the front end, prevent chronic diseases.
01:52And in doing so, you're saving money and obviously saving people's lives as well.
01:57Absolutely.
01:57One of my hospitals, DCH Regional Medical Center in Tuscaloosa, has consistently experienced an increased disparity in the performance of MA plans compared to traditional Medicare,
02:09stemming from pre-authorizations, inconsistent payer communication, unpredictable claim denials.
02:15The average number of days it takes to receive reimbursement for services from traditional Medicare for DCH, this particular hospital, is about 18 days.
02:26So traditional Medicare, 18 days.
02:29But for MA plans, the same hospital has to wait anywhere from 21 to 66 days for a pre-authorization.
02:38Now, I know the Biden administration did much-needed reform on pre-authorization, but it didn't go, in my opinion, far enough.
02:47And so the leadership of DCH wrote to me explaining an instance where a team member spent nearly an hour
02:55trying to obtain a pre-authorization for an inpatient admission, despite successfully obtaining the approval.
03:03The claim was later denied for, quote, no authorization on file, end quote.
03:10This led to a full appeal, which included resubmitting data and follow-up, you know, multiple follow-ups,
03:18all to eventually get the original authorization honored.
03:21We cannot afford to have this kind of insanity, for lack of a better word, and think that we can actually fix our very frail healthcare system.
03:37And so, Dr. Basil, I wanted to know from you, how can, you know, let me just back up.
03:44And now I hear that AI may be replacing people, live people on the other end of these pre-authorizations, only complicating matters.
03:52So what can I give, what assurances can I give to my constituents, especially in rural parts of my district,
03:58that MA reform is likely to happen and continue to happen, and that it won't restrict access?
04:07Right.
04:07So your data actually is very similar to what we see.
04:10We see about 20 days on average for accounts receivable for traditional Medicare and considerably longer for MA.
04:17And so that is consistent with our experience with the MA plans as well.
04:21You mentioned AI, and so that is something that AI could be a good thing,
04:26because if it helps increase the speed to where you can get a prior authorization approved,
04:31because it automatically, you know, kind of gold cards you or something like that, AI could be a very good thing.
04:36Yeah, and it also depends upon what algorithms you feed into it.
04:40So if your first instinct as an insurer is to deny, deny, deny, deny, then an AI wouldn't necessarily benefit that.
04:49Right.
04:49And I know I'm running out of time, and I did want to ask Mr. Fiedler, sorry,
04:55if you could also expound upon what you were saying about rural hospitals and MA.
05:03I know, yeah.
05:06In particular, you were, the large number of rates of denials for MA.
05:14So, I mean, certainly to the extent that hospitals are experiencing higher denial rates in MA,
05:22that has implications for their bottom lines.
05:24You know, some hospitals are going to be able to absorb that, some hospitals are not,
05:27and it's going to sort of depend on, well, you know, what's the financial condition at baseline.
05:31Yeah, thank you, Mr. Chairman.
05:32I'm sorry to extend my time, but I think that it's really important that we get to the 20% more cost for Medicare Advantage
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