Ending Health Insurance Denials: A Path to Timely, Evidence-Based Care

Health insurance companies financially benefit from denying care. They do so through the practice of prior authorization, in which medical providers must obtain approval in advance of delivering care.¹ Prior authorization has become rampant: 7 in 10 covered adults report that it is burdensome and 3 in 10 report that their health insurance company has denied or delayed care in the past two years.²

Health insurance companies throw up barriers to care by burying patients and providers in corporate red tape.³ When denials are appealed, 67 percent are overturned in Medicare Advantage, 47 percent are overturned in Medicaid managed care, and 43 percent are overturned in Affordable Care Act (ACA) markets.⁴ But denials are rarely appealed.⁵

The delays or denials of care often harm patients and increase downstream costs. A recent systematic review found that prior authorization is associated with worsening disease, hospitalizations that would have been preventable, longer hospital stays, and lower rates of disease-free survival.⁶ More than 1 in 4 physicians report that prior authorization has caused “a serious adverse event,” including hospitalization, disability, or even death.⁷ In a survey of cancer patients subjected to prior authorization, 69 percent reported a delay in care—one-third of whom were forced to wait a month or longer.⁸

Errors and delays are no surprise because prior authorization is often arbitrary and riddled with waste. Prior authorizations still rely on phone, email, or fax; use criteria that often depart from clinical guidelines and, with respect to prescription drugs, FDA indications; rely on rules that vary substantially across insurers; and delegate medical decisions to reviewers who often lack clinical qualifications.⁹ Insurance companies even pay reviewers to cut spending by using artificial intelligence to increase denials.¹⁰

It is time to end this form of health discrimination. Insurance companies should not be in the business of making medical decisions, with financial incentives to deny care to boost corporate profits.

In April 2026, the Center for American Progress released “A Patients’ Bill of Rights To Lower Health Care Costs,” which proposes ending insurance denials, banning prior authorization for emergency and routine care, and replacing prior authorization with independent clinical review for costly, overused services. This issue brief provides additional policy details for implementation of independent clinical review and clinical decision support protocols.

To ensure that banning prior authorization by insurance companies does not increase costs, CAP proposes to replace prior authorization with independent clinical review—removing insurance companies from medical decision-making altogether. Independent clinical review should be reserved for items and services that data suggest are costly, overused or misused, highly variable in utilization, and otherwise low-value.

To determine the list of items and services subject to independent clinical review, congressional legislation should require:

1. The National Academy of Medicine (NAM) to report a list of such items and services, based on a systematic review of available studies, within 12 months of enactment
2. Insurers to report, in a form and manner specified by the secretary of the U.S. Department of Health and Human Services (HHS), the percentage of allowed (payable) medical costs subject to prior authorization by benefit category
3. Insurers to report, in a form and manner specified by the secretary, the staffing hours and other administrative costs currently spent on prior authorization determinations
4. That the list exclude primary care, chronic disease management, preventive services, and generic drugs
5. The Centers for Medicare and Medicaid Services’ Office of the Actuary to use the NAM report together with the claims data to specify a list that is estimated to result in a negligible net premium impact, after accounting for administrative savings that accrue to insurers

Based on existing data, it is highly likely that such a list would include specialty drugs and radiology—both of which currently account for a disproportionate share of costs subject to prior authorization.¹¹ The list should include prescription drugs that have lower-cost alternatives with comparable efficacy. It should also include the services for which Original Medicare conducts prior authorizations, such as durable medical equipment.*¹²

Independent clinical review should be performed by independent review organizations (IROs) that are certified by an independent accreditation organization. This accreditation organization must be governed by a board that includes patient organizations, state regulators, provider organizations, employer organizations, and payer organizations—and each type of organization can make up no more than 20 percent of the board’s membership. The existing Utilization Review Accreditation Commission (URAC) does not appear to meet these requirements but could be reformed to establish greater independence.¹³

Certified IROs must not be owned by or affiliated with insurance companies or pharmacy benefit managers. In the case of Medicare Advantage, Medicare Administrative Contractors, which currently administer Original Medicare, should serve as independent review organizations.¹⁴

Payers that choose to require independent clinical review—for costly, overused services only—should pay a flat per-member, per-month fee to a certified IRO. The independent accreditation organization should publish and update the fee schedule. Critically, fees per case or decision, or fees tied in any way to denials, should be prohibited. To avoid capture, in which a long-term relationship fosters bias, payers should be required to rotate certified IROs every three years.¹⁵

Certified IROs should be required to publicly submit their performance data, including their denial rates. Certified IROs that are outliers on this performance data, such as those with a pattern of unusually high denial rates, would face an audit by the independent accreditation organization. The accreditation organization may then use this information to deny recertification.

HHS should contract with and oversee the independent accreditation organization. To ensure an adequate supply of certified IROs, HHS should provide funding to the accreditation organization to cover the certification costs for new IRO entrants.

This type of system builds upon independent clinical review that is required under the ACA. Section 2719 of the Public Health Service Act, as added by the ACA, requires plans to offer an external review for appeals of adverse benefit determinations.¹⁶ Plans typically contract with accredited IROs, with payment that must not be tied to denials.¹⁷ Based on the available data from 2021, denials that were appealed were frequently overturned, showing the independence of the accredited IROs.¹⁸

Certified IROs must use evidence-based clinical criteria that are developed and updated by the independent accreditation organization. The MCG care guidelines—which are widely, but selectively and arbitrarily, used today—should be an input into this process.¹⁹ The evidence-based clinical guidelines of physician organizations should also be utilized.²⁰ One consistent, transparent set of criteria based on evidence would replace the current patchwork, which is often arbitrary and leaves physicians in the dark.

For the reviews, certified IROs must use qualified clinical professionals, and a human—not artificial intelligence—must make the final decision for any denials. Review panels must always include a clinician trained in the application of the evidence-based criteria. Certified IROs must provide decisions within 48 hours of a provider’s submission and must use secure, standardized electronic transmissions.

Congressional legislation should strictly prohibit denials after care is delivered and claims are paid. However, payers may contract with certified IROs to review claims for unusual patterns of overuse or misuse.

If the certified IRO determines that a physician consistently deviates from the evidence-based criteria, the first step would be to inform the physician—which is likely to change behavior. Evidence indicates that “peer benchmarking”—in which physicians are rated relative to their peers—is highly effective in reducing overuse of low-value services.²¹

If deviations persist, the provider would be required to accept reduced payment for claims paid in those cases. But at no point would patients face any costs as a result of the certified IRO’s determination.

Independent clinical review targets costly, overused services after they are ordered and post-claims review targets outliers after care is delivered. But earlier intervention—before care is even ordered—is also essential to align the vast majority of physicians’ orders to the evidence-based clinical criteria.

Congressional legislation should require developers of electronic health records (EHRs) to embed clinical decision support into EHRs as a condition of certification. The clinical decision support should have prompts that are based on the evidence-based criteria that are developed and updated by the independent accreditation organization. Evidence strongly indicates that providing this support in real time at the point of care is highly effective in reducing costs and inappropriate care.²²

Today, prior authorization is a blunt hammer that is widely applied—including to physicians who practice evidence-based care. CAP’s approach aligns the vast majority of physician ordering to the evidence-based criteria and then uses a scalpel for the minority of outliers.

Prior authorization was a response to the variation in physician practice patterns and in physicians’ adherence to clinical guidelines. But it has evolved to become a blanket barrier to care to boost corporate profits. Enough is enough: It is time to end insurance denials and replace prior authorization with independent, evidence-based clinical review and clinical decision support.

* Original Medicare conducts prior authorizations for a very limited set of hospital outpatient services; nonemergency ambulance transport; and some durable medical equipment, prosthetics, and orthotics.