By Anna Wilde Mathews, Christopher Weaver & Tom McGinty

Patricia Greene had spent a month recovering from a devastating stroke when her Medicare Advantage insurer, a unit of UnitedHealth Group, decided to stop paying for her nursing home.

The 85-year-old was so weak and fragile, her son said, that she couldn’t even get herself out of bed. Her family felt she wasn’t ready to leave the facility in New York City’s Queens borough.

So she dropped her UnitedHealth coverage and enrolled in the traditional version of Medicare run directly by the federal government.

That decision saved UnitedHealth tens of thousands of dollars in the months that followed, billing records show, and shifted onto taxpayers the cost of later hospital and nursing home care in what turned out to be the final months of her life.

An analysis of Medicare data found a pattern of Medicare Advantage’s sickest patients dropping their privately run coverage just as their health needs soared. Many, like Greene, made the switch after running into problems getting their care covered.

Plans run by the private insurers in the Medicare Advantage system are supposed to offer old and disabled people the same benefits they would get from traditional Medicare. The plans can be a bargain for people because they limit out-of-pocket expenses and often offer extra benefits such as dental care.

As recipients get sicker, though, they may have more difficulty accessing services than people with traditional Medicare. That’s because the insurers actively manage the care, including requiring patients to get approval for certain services and limiting which hospitals and doctors patients can use.

People in the final year of their lives left Medicare Advantage for traditional Medicare at double the rate of other enrollees from 2016 to 2022, the analysis found. Those private-plan dropouts—300,075 during that time span—often had long hospital and nursing-home stays after they left, running up large bills that taxpayers, not their former insurers, had to pay.

They cost the federal government an average of $218 a day during that period. That is more than seven times the cost of a typical Medicare recipient, and about twice the cost of other recipients in the last year of their lives. The analysis excluded hospice expenses, which traditional Medicare typically covers for all patients.

Medicare Advantage insurers collectively avoided $10 billion in medical costs incurred by the dropouts during that period, the analysis found. If those beneficiaries had stayed in their plans, the government would have paid the insurers about $3.5 billion in premiums, meaning the companies netted more than $6 billion in savings during that period.

“These are some of the costliest services, received by some of the costliest patients,” said Claire Ankuda, a physician and researcher at Mount Sinai Hospital in New York who focuses on end-of-life care. “Plans are strongly motivated to reduce the cost of care delivery.”

Medicare Advantage companies said they use Medicare’s standards when they review and approve medical services, and that their setup improves care for their members, including those at the end of life. They said their oversight ensures that customers get safe, appropriate and high-quality care.

A UnitedHealth spokesman, Matthew Wiggin, said the analysis focused on just a tiny fraction of the company’s Medicare recipients and that nearly all Medicare Advantage participants are satisfied with the program. He disputed that care denials by insurers played a role in people’s decisions to switch out of Medicare Advantage, saying patients at the end of life might switch coverage for many reasons.

Medicare experts both inside and outside the federal government have raised concerns about data that shows patients with the biggest medical needs are more likely than others to leave Medicare Advantage plans. A 2021 Government Accountability Office report warned that patients who dropped out of Medicare Advantage in the last year of their lives imposed high costs on the Medicare program and could signal issues with “access to care or the quality of care provided under [Medicare Advantage].”

Medicare Advantage grew out of the idea that the private sector could make the sprawling Medicare program more economical, and private insurers now oversee benefits for more than half of Medicare recipients.

The insurers use some of the same money-saving tactics they use with their non-Medicare customers, such as requiring referrals from primary-care doctors or approvals from insurers for many services, and including only certain hospitals and doctors in their networks. In 2022, Medicare Advantage insurers denied 3.4 million requests for services, according to an analysis by the health-policy nonprofit KFF.

Traditional Medicare requires preapproval for only a small number of services, including surgeries that could be cosmetic—a type of care not covered by the program.

The Medicare data available to researchers doesn’t include details about denials of care by either Medicare Advantage insurers or the traditional government program. Recipients might switch to traditional Medicare for many reasons, including changes in their finances or geographical moves.

In a 2022 report, the inspector general that oversees the Medicare agency analyzed a sample of Medicare Advantage denials and found that 13% of them actually met Medicare coverage rules and likely would have been approved if the patients had been enrolled in government Medicare. The report said some of the most common improperly rejected services were pricey ones sought by patients after they left the hospital—stays at nursing homes and inpatient rehabilitation facilities.

A recent report by the Senate Permanent Subcommittee on Investigations found that Medicare Advantage plans had high denial rates for care in institutions where patients go after hospital stays. For the largest insurers, the rejection rates for such care were between about three and 16 times their denial rates for all services in 2022. In traditional Medicare, hospitals and nursing homes determine who gets such services.

Switching to traditional Medicare gives some patients another path. The analysis found nearly 20% of people near the end of life who left Medicare Advantage received nursing-home services within a week of landing back in traditional Medicare. By comparison, 3.9% of all traditional Medicare patients near the end of life used those services in a typical week.

A spokeswoman for the Centers for Medicare and Medicaid Services said it “has taken many steps to address the use of prior authorization by MA plans and ensure that people with Medicare Advantage have timely access to care.” Any further changes would come through a formal rule, she said.

Covering costs

After a near fatal car wreck that left him with a brain injury, Joseph Smoltz, 78, spent weeks in the hospital. When he moved to a nursing home in New York’s Westchester County, he was still disoriented and struggling to speak, records indicate. In late December of 2020, the nursing home referred him to an inpatient rehabilitation facility that specializes in brain-injury treatment. The request was submitted to his Medicare Advantage insurer, Anthem, for approval.

His son Ken Smoltz, a sales executive in the finance industry, had hired a consultant, Susan Keating, to help advise the family on managing his father’s care. Her advice: Move him to traditional Medicare, which was more likely to cover his needs.

So the elder Smoltz quit Anthem and joined traditional Medicare, as of Jan. 1, 2021. Three days later, his son got an email from the nursing home saying Anthem had rejected the earlier request for a transfer to the rehab facility.

Traditional Medicare would pay, though, so he moved the next day and spent about two months in the inpatient rehab facility. The cost to Medicare: more than $85,000.

Ken Smoltz was left scratching his head about the disparity in coverage. “What you think is the same is just not the same,” he said.

A spokeswoman for Elevance Health, the parent company of Smoltz’s Anthem plan, said it uses prior authorization to ensure “the care our members receive is safe, medically necessary, high value, and appropriate.” Decisions can be appealed, she said.

Medicare Advantage has grown over the past two decades to provide coverage to more than half of the 67 million seniors and disabled people on Medicare. Insurers have lured new customers with plans that promise free dental coverage and eyeglasses, and caps on copays and other out-of-pocket charges.

Under traditional Medicare, seniors who want to limit such fees need to buy an extra policy called Medigap.

To gauge how well Medicare Advantage serves some of the sickest patients, researchers analyzed enrollment patterns during Medicare participants’ final year of life. The analysis used billions of Medicare records obtained under a research agreement with the federal government. The data doesn’t include patients’ names, and it wasn’t used to identify anyone named in this article.

It was observed that 5.1% of Medicare Advantage members in the last year of life dropped out to go to traditional Medicare, compared with 2.6% among other Medicare Advantage enrollees.

The traditional Medicare program spent twice as much a day on hospital care for the end-of-life Medicare Advantage dropouts as it did for other end-of-lifers in traditional Medicare, and more than three times as much on nursing-home care.

To be sure, people near the end of life join Medicare Advantage plans, too, but they do so at a lower rate than the broader population, the analysis found.

Patients often choose the private plans because of the perks they see in ads, said David Meyers, an assistant professor at Brown University who has studied Medicare Advantage. “What you don’t know when you are picking a [Medicare Advantage] plan is how long care is going to be delayed because of a prior authorization requirement,” he said.

Medicare Advantage insurers pointed to the majority of members, including those near the end of life, who chose to stay in their plans. UnitedHealth said it was “unfortunate” that the analysis wasn’t more focused on these members.

Leaving a Medicare Advantage plan in the last year of life might add to costs and problems, said Dr. Margaret-Mary Wilson, UnitedHealth’s chief medical officer. “When care is disrupted, you’re going to get rework, you’re going to get inefficiencies.”

‘Freaking out’

Patricia Greene, the stroke victim who left her Medicare Advantage plan, had chosen the UnitedHealth product after seeing an ad on TV, said her son, Michael Greene. He was surprised when nursing home staffers told him UnitedHealth had rejected their recommendation for a longer stay, he said.

“I started freaking out,” recalled the retired New York City paramedic. His mom couldn’t afford to pay for the nursing home, and she didn’t have the strength for tasks like going to the bathroom by herself, he said.

He appealed the UnitedHealth decision twice and lost. He said he didn’t know the Medicare review process allowed him another level of appeal. Instead, he signed up his mother for traditional Medicare and Medicaid, the government program for low-income Americans.

Those government programs covered her continued stay in the nursing home, a hospital admission to treat a urinary-tract infection and other issues, and other expenses. Four months later, she was able to return home to her Queens apartment, where she passed away.

UnitedHealth said 13% of Medicare services are subject to prior authorization requirements under its plans, and less than 1% of all Medicare claims are denied.

For nursing-home authorizations, UnitedHealth’s Dr. Wilson said, the company uses Medicare criteria. The use of such reviews “is really driven by the need to ensure clinical quality and the safety for the people that we serve,” she said. “If a person doesn’t need to be in a hospital or a facility, then they really shouldn’t be there.”

According to the Senate report, UnitedHealth’s denial rate for authorizations of such care rose from 1.4% in 2019 to 12.6% in 2022. UnitedHealth said its denial rate for nursing-home authorizations was 9.2% in 2023, and that the report, which it noted was by the committee’s majority staff, mischaracterizes the Medicare Advantage program and UnitedHealth’s clinical practices.

Medicare rules make it complicated to switch out of Medicare Advantage. Most Medicare enrollees can adjust their coverage only once a year, to take effect on Jan. 1. Enrollees who are in nursing homes get a special window to change plans. Still, their new coverage doesn’t take effect until the start of the following month.

Tatiana Fassieux, a Medicare expert at the nonprofit California Health Advocates, navigated a transition for her own mother in 2022. Her mom, Agnes Smirnoff, had been in a Los Angeles-area nursing home for 19 days, recovering from a broken femur, when her Blue Shield of California Medicare Advantage plan said that June that she needed to go home.

Fassieux felt that her mother, then 96, still needed nursing-home care. Fassieux won three appeals, forcing Blue Shield to pay into early July.

Eventually, she lost. Fassieux decided to switch her mother to traditional Medicare, but she had to stay in the Medicare Advantage plan until the start of the next month.

Fassieux’s family spent more than $14,000 of their own money to keep her mother in the nursing home during her last few weeks in Medicare Advantage. That Aug. 1, traditional Medicare kicked in and covered two more months of nursing-home care, costing the government about $55,000.

A Blue Shield spokesman said its authorization decisions are governed by Medicare criteria, and can be appealed. “We recognize that many end-of-life cases are extremely complex,” he said, adding that the company is committed to providing seniors with access to care.

Complicated choices

Many patients feel they can’t afford to leave Medicare Advantage plans because their plans limit copays and other out-of-pocket charges, while traditional Medicare doesn’t.

Many enrollees in regular Medicare cover those costs through supplemental Medigap plans or Medicaid. Those who sign up for Medicare when they turn 65 have a window to buy Medigap coverage at relatively low rates. But when people switch to traditional Medicare later, Medigap companies can charge far more for those with pre-existing conditions—or reject them altogether.

The analysis found that people in the last year of life who had access to that type of additional coverage—either Medicaid or Medigap policies—dropped out of Medicare Advantage at far higher rates.

That might help explain why certain Medicare Advantage insurers had among the highest dropout rates in the analysis. At Healthfirst, an insurer in New York, where state law makes Medigap policies far more accessible, 12% of members near the end of life left for traditional Medicare, more than double the rate of the broader industry.

At Molina Healthcare, an insurer focused on patients with both Medicare and Medicaid, 16% of members quit their plan in the last year of life, the highest rate in the country among large insurers.

Both insurers pointed to the large share of their Medicare members who are also enrolled in Medicaid. A Molina spokesman said that, based on its membership mix, “the statistics are well within our expectations and in line with industry norms.”

A spokeswoman for Healthfirst, a nonprofit, said its overall disenrollment rate, for all members, was half the national average last year. “We take many steps to make it easier for members to get access to care,” she said.

Janet Burch, an 80-year-old retired teacher in Clifton, Texas, had a stroke in February. She was airlifted from the local hospital to one in Waco, where she spent eight days, including some in the intensive-care unit.

The hospital referred her to a nursing home, but UnitedHealth, her Medicare Advantage insurer, refused to cover it. Burch’s family was angry. “They just abandon you if you’re sick,” said her sister, Susan Orr.

The insurer decided Burch didn’t need nursing-home services, based partly on records showing she could walk “100 feet with a walker and light-touch support,” according to a document later sent to the family.

A video taken by one of Burch’s sisters near the end of her hospital stay showed the patient shuffling hesitantly with a walker, while an attendant kept a grip on a belt strapped around her waist.

Terrified that the frail, often-disoriented Burch would fall and hurt herself, Orr and two other siblings took turns staying at her house. UnitedHealth paid for some care in her home, including visits by a health aide and a physical therapist, which Orr said had little effect on her condition.

The family looked into moving Burch to traditional Medicare, but an insurance agent warned that a Medigap policy would be costly. In Texas, patients with pre-existing conditions can be charged more for Medigap coverage or rejected outright. Also, Burch likely would have needed to wait until the start of 2025.

The family ended up tapping her savings to pay for a local nursing home, where she could get frequent physical therapy. Burch paid about $4,900 for approximately three weeks, and her condition improved, Orr said.

Burch moved to an assisted-living apartment and walks without a walker now, according to her sister.

UnitedHealth said the documentation submitted by Burch’s care team “did not support care in an inpatient setting.” The company said a physician who treated her in the hospital was offered the chance to do a peer-to-peer review and declined.

Burch remains in her Medicare Advantage plan.