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UHC Medicare Advantage Change May Soon Lead to Increased Denials

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In order to help maintain the financial feasibility of the Medicare program, Congress passed the Medicare Secondary Payer Act ("MSPA"). The rationale set forth was that Medicare should not pay for medical services which are the responsibility of another party (generally referred to as "primary payers"). All automobile insurers are considered primary payers under the MSPA. Therefore, healthcare providers are required to first seek payment from these payers before Medicare will consider processing a claim.

Federal regulations have made it clear that Medicare Advantage Plans ("MAPs") are also subject to secondary payer considerations. MAPs are required to:

  1. identify payers that are primary to Medicare
  2. identify the amounts payable by those payers
  3. coordinate benefits with primary payers

These requirements place a burden on MAPs that goes beyond the normal scope of paying and processing traditional health insurance claims and now MAPs are deciding to pass this burden on to healthcare providers.

In a January 2020 bulletin, UnitedHealthcare announced a change in the way claims will be processed for their MAPs when a member receives treatment for accident-related injuries. Beginning in April 2020, healthcare providers will be required to submit proof that a claim was submitted to the primary payer. If proof is not provided in a timely manner, the claim may be denied. This requirement forces a provider to prove a claim was filed with the primary payer(s), which means the provider must identify these payers and provide documentation that a claim was filed (either through a medical lien or another mechanism) and the steps it undertook to ensure payment was issued or the claim was denied.

While some MAPs currently instruct healthcare providers to submit claims to primary payers, we expect that many, if not all, will follow UHC’s lead and require proof when filing a claim for payment. Healthcare providers who are not positioned to diligently pursue medpay and/or liability payments may find themselves dealing with increased denials on Medicare Advantage claims in the near future.