Mother May I? Unmasking Pre-Authorization

Navigating the maze of regulations to access essential care has become a pressing issue in America, sparking widespread frustration and debate. Americans feeling "aggrieved" has become an epidemic, with 20 million Americans burdened by medical debt.¹ Unfortunately, many people cannot depend on their health insurers to determine the "appropriateness of insured treatment" for their conditions through the pre-authorization process. The tragic murder of Brian Thompson has only amplified scrutiny of health insurers’ practices and standard operating procedures (SOPs). For patients, health insurance rarely feels beneficial when it’s time to access care or when debt collectors come knocking.

Major insurers like United Healthcare are notorious for constructing barriers wrapped in bureaucratic red tape to avoid fulfilling their commitments to cover medically necessary treatments. However, around two decades ago, United Healthcare conducted a cost-benefit analysis of utilization management and concluded that the expense of employing call centers staffed with clinicians outweighed the savings from denying care. In a calculated move, they eliminated pre-authorization and hence their utilization management nurses—the so-called gatekeepers to care. It was a shrewd decision, saving money at the expense of patient access.

However, as with many corporate cycles, a new leadership regime at United Healthcare reinstated roadblocks designed to delay or even cancel members’ access to medical treatment. This isn’t a critique of their senior management, whose third-quarter revenues alone exceed $100 billion. Rather, it’s a reflection of the entrenched strategies in the health insurance industry that prioritize cost-cutting over patient care².

Interestingly, around a decade ago, Aetna—a 163-year-old insurer—challenged these entrenched ideas. Under CEO Mark Bertolini’s leadership, Aetna questioned traditional actuarial approaches, such as the tendency to deny care based on adverse selection or moral hazard. Bertolini introduced the phrase, “Convenience is the new Quality,” highlighting a key issue: patients are more likely to trust a neighbor’s recommendation than a provider quality rating agency when choosing a doctor. While healthcare professionals focus on metrics like iatrogenic diseases, patients prioritize convenience—how soon they can get an appointment, how close the doctor is, or how long they’ll wait in the office.

Bertolini’s leadership also led to significant policy changes, such as revising hospice eligibility rules. Prior to 2003, hospice care was restricted to individuals in the last six months of life. By removing this requirement—despite strong objections from actuaries—Aetna reduced end-of-life care costs by 80% over three years.³ Additionally, the percentage of people dying at home rose from 24% to 76%.

At Healthrageous, we’ve embraced Bertolini’s philosophy by developing intelligent and counterintuitive SOPs, such as simplifying access to supplemental meal benefits. For instance, requiring pre-authorization for a meal benefit isn’t just inefficient—it’s nonsensical. A benefit that requires members to jump through hoops defeats its purpose.

Sadly, many corporations design their benefits to be intentionally difficult to use. This extends beyond healthcare, with companies hiding customer service numbers or insurers retreating from states hit hardest by climate change. At Healthrageous, we take a different approach: if a smart benefit isn’t being utilized because of excessive red tape, we call it what it is—a "dumb benefit."

Take, for example, seniors who struggle to access meal benefits. Poor nutrition weakens their immune systems, leading to costly disease progression and chronic conditions. When friction and regulatory barriers discourage enrollment, everyone loses—the member, the health plan, and ultimately the healthcare system.

By eliminating unnecessary regulations, we see tangible results: greater member satisfaction, improved retention, and lower medical costs. In a Congestive Heart Failure (CHF) study, Healthrageous reduced hospital readmissions by 20% for patients receiving meal benefits compared to those who didn’t. This intervention saved the health plan $1.8 million.

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Before devising the next bureaucratic obstacle, consider the smarter path: friction-free supplemental benefits like those offered by Healthrageous. They’re better for members, better for plans, and better for the future of healthcare. 

We believe so strongly in this no pre-authorization approach that we share risk with our clients, ensuring that everyone wins, especially seniors. Contact us to learn more!

¹ The Burden of Medical Debt in the United States
²‘Delay’ and ‘Deny’: The Outrage Over Prior Authorization
‍³ A Conversation with Mark Bertolini