Fixing a System That Can Deny Health Coverage: Miranda Yaver on Insurance Reforms (Part II)
"Comprehensive health insurance reform really needs to happen at the federal level."
Last issue we shared the first part of my Q&A with Miranda Yaver, author of the new book Coverage Denied: How Health Insurers Drive Inequality in the United States, where we discussed the ins and outs of health insurance coverage denials and how we ended up with such a system.
In part two of our conversation below, we discuss potential reforms and policy solutions and how to achieve them.
Miranda is a health policy professor at the University of Pittsburgh and was the Roosevelt Institute’s 2025 author-in-residence.
This interview has been edited and condensed for clarity.
Stephen Nuñez: You wrote the book before HR1 (the “One Big Beautiful Bill Act,” or OBBBA) was passed. There are myriad ways this bill will make health care worse for people. Is there anything that you’re particularly focused on, given your research into the causes and consequences of this (quasi-)managed-care system we seem to have backed ourselves into?
Miranda Yaver: In addition to the broad coverage losses and increases in administrative burdens associated with enrolling and staying enrolled in health insurance, a couple of things happened. First, with the expiration of the enhanced premium tax credits, those with Affordable Care Act (ACA) marketplace insurance saw their premiums jump up dramatically. That means denials of coverage that do arise may be more harmful because people have less financial wiggle room with which to get creative with stopgap measures.
With both premium increases and new administrative complexity around eligibility verification, there’s also greater potential for patient churn among health insurers, which creates a setting that can lead to myopic coverage decisions from insurers who feel they can pass the buck rather than make up-front investments in patient health. For example, an insurer might deny coverage for a diabetic’s continuous glucose monitor with the expectation that by the time the patient faces costly complications from poorly managed glucose, they’ll be with another insurer.
I think whenever we’re introducing new fiscal pressures in the insurance market, we need to worry about private insurers turning to prior authorization as one way to make up some of that financial deficit.
Stephen: I was joking on social media the other day that if you ask an ordinary person about the American Medical Association (AMA), you’re likely to get positive comments (“doctors are the good guys!”), but if you ask a social scientist you might get a tirade or perhaps a hissing sound. The AMA has since the time of President Franklin D. Roosevelt worked to prevent the expansion of “socialized medicine” and has been a large lobbying barrier to several attempts over the decades to expand public insurance and push industry reform. And yet pre-authorization (and post-procedure coverage denial) undermines doctors’ autonomy and bandwidth in ways that seem to really irk them. Politics can make strange bedfellows, so I’m wondering if you see any fruitful avenues for collaboration with the AMA on this issue?
Miranda: I think that’s absolutely right, and in Coverage Denied, I certainly highlight both perspectives: In chapter one, I walk through the political origins of prior authorization and its entrenchment. It’s hard to talk about the origins of this managed-care tool without reflecting on the yearslong outcry over socialized medicine, but I also highlight the AMA’s more contemporary work around prior authorization and physician burden reduction, as well as broader issues of professional autonomy. The AMA’s physician surveys call attention to the sweeping impact (or at least, perceived impact) of prior authorization—from time and staffing demands to adverse effects on patients. The organization has also led the charge in advocacy and model legislation to do things like regulate the qualifications of reviewing physicians, promote transparency concerning prior authorization requirements, require more timely processing, and reduce the volume of prior authorizations. None of those issues address the broader philosophical objections to prior authorization—that is, that health coverage decisions are being made by companies with fiduciary responsibilities to shareholders rather than by treating physicians—but they do reduce the extent to which patients and their physicians are dealing with the constant headaches of these processes.
The AMA rightly frames these prior authorization headaches as sources of physician burden and burnout. Even if physicians might prefer to do away with prior authorization, and even though promoting transparency and timeliness won’t necessarily result in fewer denials, these reforms could take the guesswork, “black-box” feeling out of prescribing. In turn, physicians could more easily assess whether and when to move on to a plan B rather than endure the protracted delays common under the current system. Regulation of the qualifications of reviewing physicians could (at least on the margins) reduce the odds of erroneous denials that reflect lack of familiarity with more recent treatment protocols outside a doctor’s field of specialty, and which necessitate burdensome appeals to rectify. And even in this highly polarized and gridlocked political climate, some of these measures are passing at the state level with unanimous or near-unanimous support.
But this does not disrupt the reliance on prior authorization or confront the philosophical objections. A larger-scale intervention into this facet of the US health-care system would require more sweeping health reform from Congress than is feasible in the foreseeable future given *gesticulates wildly at the world.* Although the AMA continues to oppose single-payer, over the decades they have become more conciliatory toward issues of health coverage expansion and now support a public option. A public option would certainly move our health insurance system forward because private health insurers (which have been heavily reliant on prior authorization, delays, and denials) would have to compete with a government plan. Still, my money is very much on single-payer—which would extract the profit focus—for delivering the most relief for those in need of health care. But politics is complex and often much more a dynamic of incrementalism than waving a magic wand, and I’m a big believer in moving the needle where we can and when we can, even if the bigger philosophical issues of health insurance delivery will have to wait a few years.
My money is very much on single-payer—which would extract the profit focus—for delivering the most relief for those in need of health care.
Stephen: So we have path dependence, we have a health-care system that is for-profit and generates poor outcomes (for hospitals, doctors, patients, even insurance companies alike), we have a host of actors, and we have the complexities of federalism on top of that. Things feel pretty dire! What are some things we could do at the state and/or federal level to solve or at least mitigate the problems you detail in the book?
Miranda: One area where states have begun to take action is the role of AI, which health insurers are increasingly using to bulk-process claims and prior authorizations. California’s SB 1120, which went into effect this year, stipulates that when insurers’ AI programs recommend denials, they must be reviewed by physicians in the appropriate specialty. These technologies are advancing faster than regulatory oversight tools can keep up with, and unlike the relatively low-stakes penalty assessed when, say, a student uses AI for a paper and hallucinates a citation, when AI programs get health coverage decisions wrong, the consequences can be dire. And especially amid the ongoing litigation against Medicare Advantage plans’ use of AI to deny (with reversal rates of 80–90 percent), this could be a valuable shift.
When AI programs get health coverage decisions wrong, the consequences can be dire.
Some states are doing things that I’m not as fond of: Gold card laws, under which physicians who secure around 92 percent or more approval for their prior authorizations become exempt from these processes. It sounds good at face value, but it’s really replacing one form of physician burden with another because it’s assessed at the plan-service level, such that one might have a wallet full of gold cards to keep track of—a gold card for head CT scans with Aetna and abdominal CTs with Cigna, and so on. Texas’s law was so restrictive that just 3 percent of physicians qualified as “high performing” under its terms, so its impact has proven quite limited.
There are other options worth thinking about that are highly feasible and don’t require revisiting big philosophical questions about the US health care system. For example, plain-language rules in health insurance communication could help prevent patients from falling through the cracks due to complex and technical explanations of denials and appeal processes. The average American adult reads at around the 8th grade level, but most health insurance materials are written in at least the 10th grade level. Lower-income and lower-educational attainment patients and non-native English speakers are especially vulnerable in this system. This would also be relatively simple to administer and enforce. The Washington State Office of the Insurance Commissioner is a great model of guiding patients through appeal processes—from an accessible YouTube video to template appeal letters for different types of denials. Of course, this doesn’t address the propensity to deny in the first place, but it can mitigate the ensuing patient burden.
It would also be relatively feasible for states to limit prior authorization’s application to only domains of health care where there are at least relatively recent evidence bases of abuse or overprescribing. All too often, prior authorization is applied to areas of medicine where this overuse is not a documented concern. Lower lumbar spine MRIs are a commonly cited example of overprescribing, such that health insurers will often require a few weeks of physical therapy before being able to proceed with the scheduling of the MRI. That might not necessarily be an inappropriate use of prior authorization, whereas applying this process to a drug like PReP is far less logical, since it is life-saving and there is no evidence of abuse. States could, at the least, require insurers to justify the use of prior authorization for these types of procedures with data and evidence.
At the federal level, the House of Representatives approved by a voice vote the Improving Seniors’ Timely Access to Care Act in 2022, but despite bipartisan support, the legislation died in the Senate. This bill was centrally aimed at streamlining existing prior authorization requirements. It would require Medicare Advantage plans to deliver timelier decisions through electronic processes. This wouldn’t increase the odds of approval, but it would mitigate delays before either initiating appeal or moving on to a plan B.
In the background of all of these state efforts is the reality that state reforms cannot touch the majority of employer-sponsored health insurance plans. This quirk, which deviates from the federalism embedded into so many other areas of health policymaking and beyond, is due to the constraints of the Employee Retirement Income Security Act (ERISA). ERISA preempts state laws that “relate to” self-insured health plans, which cover most workers in employer-sponsored insurance. Because of the limits of what states can do to move the needle on equitable coverage, comprehensive health insurance reform really needs to happen at the federal level, which presents obvious challenges in the current political environment.
Because of the limits of what states can do to move the needle on equitable coverage, comprehensive health insurance reform really needs to happen at the federal level.
Stephen: Cost control/overutilization is a fundamental problem, even if the way the US “solves” for it is particularly awful. I can think of a variety of ways single-payer public health insurance helps: no insurance churn so no short-termism; deductibles, copays, and coverage are subject to a democratic process; and the government has monopsony power to negotiate down provider rates. And yet the fee-for-service conundrum and responses to it still exist in other countries with models closer to single-payer.
Are there any models or policies from the international context that you find promising, even if not politically feasible in the US right now? I’m thinking of things like New Zealand’s no-fault compensation system for medical injury, which means doctors don’t have to run tests simply to avoid lawsuits, or Pay-for-Performance/Value-Based Care models that could base payment on health-care outcomes and not just volume of services.
Miranda: My work is very US-centric, but I’ve grown increasingly interested in Switzerland. Even though traditional Medicare is immensely efficient, spending vastly less on overhead than do private insurers, Americans largely maintain the perception that the private sector is comparatively more efficient in policy delivery. That constrains our political choices (though this preference is becoming weaker over time, as more Americans are open to a government-run system). Given this underlying preference, are there ways that we can make private health insurance work? I think Switzerland shows that the answer is “yes, but.”
Even though traditional Medicare is immensely efficient, spending vastly less on overhead than do private insurers, Americans largely maintain the perception that the private sector is comparatively more efficient in policy delivery.
The Swiss health insurance system is actually more privatized than ours, and like our system, there’s a great deal of decentralization across localities. Where it diverges is its coupling of privatization with significant regulation as opposed to a broader embrace of free-market principles. The Swiss are legally required to be insured (though they have many options from which to choose), and on top of the standard but comprehensive insurance package, people can purchase supplemental private insurance to fill in any gaps or gain access to better hospital accommodations (e.g., a private room) or to see additional health-care providers. Consequently, nearly everyone in Switzerland is insured. In contrast with the relatively consolidated insurance market we have—with UnitedHealthcare, Cigna, CVS Health/Aetna, Elevance, Centene, Humana, and Kaiser Permanente dominating the markets, especially in certain regions—the Swiss have 56 insurers from which to choose. But the Swiss government exerts considerable regulatory oversight over both quality and prices.
So, you’ve got nearly universal coverage, market competition, regulation of pricing so as to mitigate exploitative charges to patients and the system writ large, and privatization. But all of these elements are in combination with enough regulation that you’d be unlikely to run into the insurance barriers that are such a dominant American experience and that make up the focus of my book.
The challenge, of course, is that to get this better coverage (which unsurprisingly produces better health outcomes), the Swiss both accept a higher tax rate than US politics tends to find palatable, and they accept the insurance mandate (whereas there was public consternation, driven by conservative political leaders, over the ACA’s individual mandate). To be sure, Americans’ attitudes could shift: We’ve certainly seen significant growth in support for the ACA, and the share of Americans who see it as the federal government’s responsibility to ensure health-care access has increased significantly over recent years. To the extent that these trends continue, that could facilitate a broader menu of health reform options.
But there are also some questions about scalability given that Switzerland has roughly the same population as New Jersey, is quite homogeneous, and invests more broadly into addressing social determinants of health. All too often in the US, we ignore those social determinants, which are truly in the driver’s seat of our health, while pouring money at health-care delivery. This leaves us with high health spending but a suboptimal return on investment. Switzerland can serve as some inspiration to right-size US reliance on private industry, though the extension may be difficult amid political preference for lower tax rates and deregulation.
Stephen: Is there anything else we haven’t discussed that you’d like to highlight?
Miranda: One elephant in the room amid discussions of health insurance barriers—their proliferation and their persistence—is why health insurers have been able to remain so largely unaccountable. At least part of this answer comes back to ERISA. To begin with, it preempts states’ efforts at comprehensive coverage reforms. This means that when political conditions aren’t well-suited to federal reforms, while we can often turn to the states to advance progress where they can, ERISA prevents comprehensive prior authorization reforms or the broader reduction of administrative burden in insurance. Further, it denies meaningful legal recourse to patients enrolled in self-insured health plans, which is about two-thirds of covered workers. Under ERISA, denied patients cannot obtain monetary damages (e.g., punitive damages, or damages for pain and suffering) and attorney’s fee recovery is left to the discretion of the judge. All that patients are entitled to receive is the benefit owed, which may be cold comfort to someone whose condition has worsened. And needless to say, less affluent patients will be risk-averse in taking legal action with this vulnerability to being left to cover their own legal costs.
The lack of meaningful remedies is where it becomes really clear that health care was an afterthought in ERISA, which was motivated by pension concerns. If your employer tries to screw you out of your pension, you can sue and get your pension back, but health conditions can change and make this enforcement apparatus ill-suited. Further, lawyers will likely be reluctant to take on cases that lack a monetary value. And if insurers know that patients are especially unlikely to sue insurers under these conditions, effective control over these entities can be harder to come by because wrongful denials are virtually costless. So, ERISA’s denial of meaningful remedies for wrongful coverage denials can not only be harmful to the patients when such denials arise, but insurers may have less incentive to exercise caution when deciding whether to cover costly care because they won’t face a meaningful penalty. In the worst case scenario for them, they eventually cover the treatment if the patient challenges the denial, which they rarely do. This design can thus increase the probability that insurance barriers arise in the first place. Congress tried to fix this problem in the late 1990s with the Patients’ Bill of Rights, but it didn’t come close to enactment. That bill is a critical issue for legislators to revisit. I’m currently writing another book that looks squarely at what accounts for the entrenchment of this feature of our health insurance system and the ways it disrupts equitable access to health care.
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