Health Law Daily Wrap Up, MEDICARE PART C/MEDICARE ADVANTAGE—OIG REPORTS: Medicare Advantage insurers reversed “nearly all” skilled nursing denials on appeal, HHS OIG finds, (Jun 12, 2026)

By Steven Melendez

The OIG says this raises concerns about the validity of those initial denials, suggesting patients were denied medically appropriate care.

Medicare Advantage organizations (MAOs) overturned 95 percent of denied requests for admission to skilled nursing facilities upon appeal, the Office of Inspector General (OIG) for the HHS reported. The high rate “indicates that some enrollees were initially denied medically necessary care and raises concerns about denials that were not appealed,” according to the OIG report. Overall, 19 MAOs studied denied about 12 percent of requests for admission to skilled nursing facilities, which provide short-term skilled nursing and/or therapy that is designed to help patients recovering from an illness, injury, or surgery. Denial rates varied by MAO from a high of 23 percent to a low of 0.4 percent. Enrollees and providers appealed about 18 percent of SNF denials, according to the report (OIG Report, OEI-09-24-00331 (June 11, 2026)).

Of the MAOs studied, the three largest by enrollment—Humana Inc, CVS Health Corporation, and UnitedHealth Group, Inc.—had the most requests for SNF admission, receiving about 75 percent of the total requests, and had three of the five highest denial rates, according to the OIG report. The highest denial rate belonged to Molina Healthcare, Inc., which denied 23.4 percent of requests, though it only received 591 requests since June 2024 compared to UnitedHealth Group’s 41,486. The lowest reported denial rate belonged to MHH Healthcare, L.P., which denied only 0.4 percent out of 242 received. For-profit MAOs, including the three largest and Molina, denied 13 percent of requests, compared to 8 percent for nonprofit organizations, the report found.

For patients who appealed denials, the median wait time to a final decision was six days, though 17 percent of appeals took 10 days or longer to resolve. “In contrast, when MAOs approved the initial request for SNF admission, they typically approved the request on the same day that the request was made, enabling a much faster discharge from the hospital,” according to the report.

MAO contractors. Overall, half of requests were processed by an MAO contractor called naviHealth, which denied requests at a rate of 14 percent—a higher rate than MAOs that processed requests internally, which denied 11 percent, and other contractors, which denied 9 percent. NaviHealth is a subsidiary of UnitedHealth Group, itself an MAO. Most of the requests it processed were for UnitedHealth, but it also handled requests for BCBS of Michigan Mutual Insurance Co., Highmark Health, and Humana Inc.

“Variation in denial rates between contractors and MAOs that review requests internally raise concerns about whether the contractors are receiving appropriate training, guidance, and oversight from MAOs on how to assess requests,” according to the report.

MAOs overturned denials by naviHealth at a 97 percent rate, the same rate as denials by other contractors, though they only overturned internally processed denials at an 89 percent rate. “Higher overturn rates of denials issued by contractors could indicate differences in policies or procedures between the parent company and its contractor or differences in interpretation of CMS coverage rules,” according to the report.

Nursing homes. The report also found that MAOs and their contractors denied requests for SNF care from nursing home residents 40 percent of the time, compared to an 11 percent rate for all other Medicare Advantage enrollees. Nursing homes typically operate both as skilled nursing facilities—providing short-term skilled care after a hospitalization—and as ordinary nursing facilities, providing lower-intensity residential care for people with functional or cognitive impairments, such as dementia, according to the report.

Medicare pays for SNF care for people who require it after hospitalization and meet other requirements. It does not pay for ordinary nursing care or room and board for nursing home residents, who must pay out of pocket or receive coverage through Medicaid or private insurance. In June 2024, nursing home residents submitted about 3 percent of requests for SNF admission, according to the report.

Some MAOs indicated to the OIG that nursing home residents may be less likely to meet admission criteria “because they already have some intermittent skilled therapy supports available” or may have a more complex medical history that diminishes their ability to participate in SNF therapy. But patient advocacy and nursing home industry groups told the OIG that outpatient therapy in a nursing home is not a substitute for SNF care and that therapies can be adapted to patients with impairments like dementia.

Conclusions and recommendations. The OIG report recommended CMS regularly collect prior authorization data, including service type and contractor information, in order to “effectively identify MAOs with problematic patterns of denials and take action as appropriate.”

CMS should also identify the reason for the high rate of overturned denial, whether it indicates problems with the review process, providers adding needed documentation only on appeal, or another issue, the OIG concluded. The agency should also identify the reasons for the differences in denials between MAOs and their contractors, and the reasons for the higher rate of denials to nursing home residents, according to the report.

CMS neither concurred nor nonconcurred with those recommendations. “CMS stated that it uses several oversight tools, including annual audits, to ensure that the Medicare Advantage program provides adequate health care access to enrollees,” according to the report.

As of 2024, 54 percent of people with Medicare, or 32.8 million people, were enrolled in Medicare Advantage plans, with MAOs paid an estimated $494 billion by CMS, according to the report.

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