Medicare Advantage Denial Rates Are a Scandal

CVS denied 80% of Medicare post-acute care. That is not a glitch.

Let me say that again.

Eighty percent. 🚨

The Medicare Rights Center published data this week showing that the largest Medicare Advantage organizations have disproportionate denial rates for post-acute care. CVS denied 80% of long-term care hospital coverage. Humana denied 72%. UnitedHealth denied 71%. For inpatient rehab facilities, UnitedHealth led with 66%, Humana at 54%, CVS at 51%.

These are not edge cases. These are the dominant patterns of the dominant players.

Here is my take: this is not a claims processing problem. It is a business model problem.

Medicare Advantage was sold to the public as Medicare, but better. More benefits. Lower costs. A private sector upgrade on a clunky government program. What we actually built is a system where private insurers collect a government capitation check, then systematically deny the care that check was meant to fund.

Post-acute care is not elective. Long-term care hospitals and inpatient rehab facilities treat patients who just had strokes, amputations, cardiac events, traumatic brain injuries. These are not people gaming the system. These are people who just survived something catastrophic and need time and clinical support to recover.

Denying 80% of that coverage is not utilization management. It is a revenue strategy dressed up in clinical language.

And the worst part, we have known this for years. The Office of Inspector General has flagged Medicare Advantage denial patterns repeatedly. CMS has tried to tighten oversight. Congress has held hearings. The numbers keep climbing.

Now the counterpoint. The one I hear from insurer defenders constantly.

“Not every denial is inappropriate. Many are overturned on appeal. Prior authorization exists to prevent wasteful spending.”

Fair. All of that is technically true.

But when 7 in 10 post-acute care claims are being denied by the same three companies, you are not catching outliers. You are setting a default that forces patients, families, and providers to fight for care that should be baseline. Most people do not appeal. They do not have the time, the health, the resources, or the knowledge to navigate that process. Denial by attrition is still denial. 💡

At Oatmeal Health, we work in communities that have been structurally left behind by the healthcare system. Lung cancer screening. Preventive care. Early detection. The people we serve are not going to fight a Medicare Advantage denial letter while recovering from a stroke. They are going to go home too soon and end up back in the ER.

The system counts on that passivity.

The boldest thing I can say here is this: if your denial rate for medically necessary post-acute care is 70 to 80 percent, you are not a health plan. You are a bet that sick people will give up.

Question for every Medicare Advantage plan medical director reading this: at what denial rate does your organization consider the system broken, and who in your company is accountable when a patient goes home too early and dies?

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