Podcast Recap: In NJ only like specially doctors can now deny your prior authorization.
Episode # 76 of the Flatlining Podcast
This week Matthew and Ron discuss Cigna’s press release from last year that claims the insurance giant is saving lives by denying prior authorizations. Then our team takes a quick look at a New Jersey law that puts some rules on insurance companies’ prior authorization processes.
Matthew welcomed Ron back from his attendance at the American Society of Anesthesiologist Advance 2024 business event in Las Vegas last month and asked him about the language in this press release. Ron picked a few highlights and broke down Cigna’s claims and put it in perspective. The headline read "Prior authorizations help keep patients safe, improve health, and make care more affordable."
In his first comment, Ron rhetorically asked if Cigna is trying to protect us from unscrupulous doctors? Finding it all incredulous, he pointed out that this language was coming from the same company that was sued for having computer algorithms that auto-denied doctor requested procedures without any review. The press release goes on to build a case of how Cigna accomplishes these three feats proclaimed in the headline. Ron described it all as “Payer dribble.”
He took issue with most of the press release and chose a few points to illuminate and read directly from it. Speaking to one quote that read, “One data point that we [Cigna] are proud of – Since 2014, prior authorizations have led to the potential avoidance of over 500 new cancer cases among Cigna customers by preventing or limiting radiation exposure from medically unnecessary CT scans.” Ron posed the obvious questions, “What study is that from?” What kind of peer review was done he asked. He broke it down a bit more and explained what Cigna is claiming. First, that all these scans were ordered unnecessarily by physicians, and second if these scans were done, all these patients would have gotten cancer. Ron acknowledged that, yes there is risk with unnecessary radiation exposure, and it is known that the dosage from a CT scan is significant, and you could make the conclusion that if you received too many CT scans you might get cancer. But he pointed out there is an “awful lot of assumptions there with nothing to back it up.”
Ron expressed his frustration by questioning how the payer concluded that a particular CT scan was unnecessary, especially when this payer is known to auto-deny prior authorizations. The way payers often claim something was unnecessary he said, was by checking it on the back end. So, when a test result comes back ruling something out, from the payer’s perspective, that test was unnecessary. When in reality, he said, the result of this test still provides the physician with valuable information on what they are trying to diagnose.
Further breaking down this release, Ron pointed out how it touted a successful denial from a Cigna Medical director, a spinal surgeon, who denied lumbar surgery in lieu of physical therapy for a patient. He reminded us that insurance company medical directors don’t see the patients they are denying care for and only look at the medical record, problematic in his mind he said, given Cigna’s medical denial track record. Ron concluded that Cigna tries to make it sound like these issues are widespread, but he has not seen data to back these up. In the end prior authorization denials are about money, not patient care he said. You can read the full press release here.
Matthew bridged the conversation over to a recent New Jersey law that seemed to fly in the face of Cigna’s argument from their press release. He read the opening to the law that outlined what prior authorizations processes can and cannot due. The law states that the patient doctor relationship is paramount and should not be “subject to third party intrusion” and states that “prior authorization programs put attempted cost savings ahead of optimal patient care” and put further emphasis on prior authorization programs not inhibiting care and stating that only reviews be conducted by “appropriate physicians to insure fair process to patients.”
Ron and Matthew point out the obvious. They asked, why would you need a law specifying parameters like these in prior authorization programs if insurance companies, like Cigna stated in their release, are helping patients by denying prior authorizations? Ron summarized that if what Cigna said was true, a state legislature would not have to come in and direct insurance companies on what to do with their prior authorization processes. It does demonstrate that the legislators in New Jersey, understand what is happening he said.
The two dove into some particulars, Matthew pointed out that the law states that if a procedure is denied, the insurance physician must be of the same specialty as a physician managing the medical condition. He also reminded us that this law only covers fully insured plans, those that are managed by the state, not self-funded plans. In a state the size of New Jersey, you are likely looking at this law covering around 25%-30% of any one carrier’s members Ron said. He also pointed out that this is a good small step in the right direction, but you do have to look at the particulars. For example, when there are timelines for correspondence, insurance companies can play games with physicians, asking for more information, additional paperwork etc. all resetting the legal response time clock, something that is very frustrating to physicians Ron said.
What would be interesting, he said, is if this type of legislation got to the federal level which would affect those self-insured plans. Additionally, as he has said in the past, if insurance company medical directors would be defined as practicing medicine, and held responsible for denying care, that law would have some real teeth. Matthew continued into some of the publishing information requirements and Ron pointed out that payers really don’t mind the publishing denial information from a macro level, they can use it in their sales and marketing programs to employers showing how much they can save them by denying procedures, but what they don’t want, he said, was data at the micro level showing what they denied on an individual level.
This closed out the discussion for this episode, you can listen to the full podcast here and be sure to share with your colleagues and subscribe if you have not already.