Jakob Emerson Speaking Medicare Advantage & Prior Authorization

Summary

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Podcast Summary: Jakob Emerson Speaking Medicare Advantage & Prior Authorization

Becker’s Healthcare Podcast – April 8, 2026
Host: Scott Becker
Guest: Jakob Emerson (Healthcare journalist/analyst)

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Episode Overview

This episode features an in-depth discussion with Jakob Emerson, a leading journalist covering the payer arena, focused on the latest updates to Medicare Advantage (MA) policy, CMS’s final 2027 rules, and ongoing reforms and controversies around prior authorization. The episode provides insider perspectives on federal changes, industry responses, and how policy translation often falls short of practical consumer benefit.

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Key Discussion Points and Insights

1. CMS Final Medicare Advantage Rule and Rate Increase (00:41–04:33)

• CMS 2027 Final Rule & Rate Announcement:

  • CMS recently issued its final Medicare Advantage rule for 2027 along with a separate announcement on MA payment rates.
  • MA plans will see a 2.48% rate increase in 2027, which is roughly half of last year’s increase but better than a flat rate.
  • The overall message: the federal government remains firmly committed to Medicare Advantage as the primary Medicare delivery model.

• Industry Reaction to Rate Increase:

  • Jakob notes: "I think they're thrilled with it compared to what it could have been, which was essentially flat compared to last year... Happy-ish is a good way to say it." (01:59)
  • While the increase is welcome, it reflects a tempered environment compared to recent years.

• Political and Policy Context:

  • The administration's approach signals "full steam ahead" for MA despite ongoing friction with health systems and skepticism about its financial sustainability.

• Medicare Advantage’s Growing Reach:

  • Over 54% of eligible seniors are now enrolled in MA plans.
  • Scott Becker: "It seems like that is just where we’re going whether we like it or not." (02:43)
  • Emerson highlights tension: many health systems are hesitant to contract with MA due to payment issues, but MA often offers better benefits (vision, dental, hearing) not covered by traditional Medicare.

2. Cost Controversies and Upcoding in MA (03:08–07:19)

• Debate on MA’s Cost-Effectiveness:

  • Despite offering additional benefits, MA is currently costing Medicare more than traditional Medicare.
  • Scott: "This concept that there's a cost benefit to the country in Medicare Advantage has not played out yet." (04:09)
  • Jakob:
    • Upcoding is a critical issue: MA plans systematically document patients as sicker, leading to higher risk scores and increased federal payments.
    • The new rules include a nearly 6% "coding pattern adjustment" to counteract this upcoding.
    • Unlinked chart reviews—retrospectively adding diagnoses not documented during patient visits—are being excluded from risk adjustment, a notable crackdown on overpayment and potential fraud.
    • Reference to DOJ actions (e.g., Kaiser’s $500M settlement) illustrates ongoing compliance scrutiny.

• Notable Quote:

  • Jakob: "It costs more because there's a lot of tricky coding that goes on... CMS is signaling and saying we’re not abandoning scrutiny of upcoding…" (04:33)
  • The effective rate increase, including risk adjustment, approaches 5%, meaning about $13B in new funds to private Medicare insurers.

3. Prior Authorization Wars: Reforms & Industry Response (07:19–10:59)

• CMS Rulemaking:

  • New federal rules (finalized in 2024, implemented through 2026) mandate increased transparency for prior authorization (PA) decisions for MA, Medicaid, CHIP, and ACA plans.
  • Requirements:
    • Public reporting of denial/approval rates and appeals overturn rates.
    • Tighter timelines for decision-making.
    • Electronic interoperability between payers and providers.

• Insurance Industry Pledges:

  • Major insurers have voluntarily promised to mirror these reforms in commercial/employer plans.
  • Jakob cautions these are self-reported efforts with "a huge asterisk," as data mainly comes from industry channels like AHIP.

• Reported Progress:

  • Insurers claim 11% reduction in prior auths for commercial and 15% reduction for MA since last year.
  • Effectiveness remains questionable and largely unverified.

• Transparency Shortfalls:

  • Federal websites now publish PA data, but it lacks detail—consumers can’t see granular reasons for denials or breakdowns by service.
  • Analogous to price transparency rules: data is technically public but operationally useless for most people.
  • Jakob: "It's another one of those situations where the insurance industry has complied. Is it usable? Not really." (10:25)

4. Translation Gap: Policy vs. Usability (10:11–11:21)

• Scott Becker:

  • "Turning it into practical, useful stuff is very different than the legislative intent or the policy that's put forth..." (10:11)
  • Highlights a persistent gap between regulation and consumer experience.

• Jakob:

  • Reiterates that compliance often meets the letter, not the spirit, of the law, as information remains buried in unmanageable formats for the average consumer or provider.

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Notable Quotes & Memorable Moments

• Jakob Emerson on MA Policy Direction:
  "The government is still all in on Medicare Advantage… it's full steam ahead with Medicare Advantage." (02:08)

• Scott Becker on MA’s Escalating Costs:
  "The reality is… the track record so far is it's costing Medicare more than traditional Medicare, not less." (04:09)

• Jakob on Coding Adjustments:
  "Unlinked chart reviews are basically when an MA plan hires coders to go through the patient record and add diagnoses that weren't actually captured when the doctor or the nurse was in the room… these diagnoses... don’t count for risk scores." (05:55)

• Jakob on Prior Auth Data:
  "It's so broad, it's so large that the everyday person can't really use it… making some of these federal transparency efforts, I don't want to say useless, but not, not usable for you and I, at least to start…" (09:32)

• Scott Becker’s Closing Praise:
  "As always, I learned more in a quick period of time from talking to you than almost anybody else in the world." (10:59)

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Important Timestamps

• 00:41: CMS final rule & rate update for Medicare Advantage
• 01:59: Industry reaction to 2027 MA rate increase
• 03:08: Discussion on MA’s political trajectory and provider tensions
• 04:09: Cost debate—MA vs. traditional Medicare
• 04:33: CMS addresses coding pattern adjustment and upcoding crackdown
• 07:19: Transition to prior authorization reforms
• 08:25: Self-reported progress on prior auth reductions
• 09:32: Transparency rule limitations discussed
• 10:11: Broader commentary on the policy-practicality gap

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Summary Tone and Language

The episode is candid, knowledgeable, and skeptical where appropriate—especially regarding practical impact vs. regulatory milestones. Jakob Emerson brings a data-driven but approachable perspective, while Scott Becker injects real-world skepticism and humor, especially about implementation gaps and industry incentives. Both speakers drill down on the difference between policy as written and healthcare as experienced by consumers and providers.

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Transcript

[A]

This is Scott Becker with the Becker Healthcare podcast. Today for me is a great day because I get to interview today two of the brightest people that I get to talk to regularly. Today on the Becker's Healthcare podcast I get to talk to Jacob Emerson. Jacob follows the payer arena and is literally one of the most gifted people I get to visit with. I also later today get to visit with an extremely gifted person. But that person has a huge ego so I'm not going to say his name out loud right now. But he, but Jacob is able to keep his ego in check and also super bright so we'll mention it out loud. Jacob, tell us what's going on in the payer world currently. What are some of the stories that you're watching closely?

[B]

Yeah, hey Scott, I appreciate the kind words. So I think to start us off just within this last week we got CMS's final Medicare Advantage rule for 2027 along with their separate final rate announcement for how much the government is going to be raising how much they pay Medicare Advantage plan going into 2027. So some interesting updates there and just also some interesting policy updates and what it means politically and you know, contextually for the industry in terms of how the administration overall is thinking about private Medicare and then some, some updates around prior authorization. You know, everyone's favorite term that causes a lot of headaches for I would honestly argue for both sides, for both the insurance companies and the providers, but certainly I think more for the providers, just some updates there around policy CMS and then some voluntary promises from the industry, from the insurance industry and some of the progress that they say they've made on this, on this challenge recently. So Medicare Advantage and prior authorization and

[A]

talk about Medicare Advantage rates, I saw it registered, I think they went up 2.48% or something like that. But tell me what's going on there and what that means. Is the pay industry thrilled with that, not thrilled with that? Where does it look? What do other people think? Give us some of your thoughts.

[B]

I mean I think they're, they're thrilled with it compared to what it could have been, which was essentially flat compared to last year.

[A]

So.

[B]

So on that front it's good. But I think also compared to years past or last year, it's, it's about half of what they got last year in terms of a dollar amount overall. So you know, I think happy ish is a good way to say it. I think overall in terms of what the policy like the final rule and the payment rate combined tells us is that, you know, this is going to be the dominant delivery model for Medicare moving forward. The government is still all in on Medicare Advantage. There's nothing, you know, there's nothing that's changed there. I know there's a lot of rhetoric that goes around in the industry, but you know, it's full steam ahead with Medicare Advantage.

[A]

I mean, that's really an important point because as much as health systems seem to really not love and as much as physicians are not loving Medicare Advantage, when you look at OB3 and you look at what's going on with Medicare Advantage and still at 54% or so, I don't know what the exact number is right now enrolled in Medicare Advantage, it seems like that is just where we're going whether we like it or not.

[B]

Yeah. And I mean, one thing, you know, I, I often talk to Dr. Sachin Jain at SCAM Group who used to be at cms, used to be at some of the big insurers. He's, you know, is a very smart industry leader and about some of these tensions with MA and health systems because it's a very real thing. A lot of health systems are not contracting with a lot of the bigger MA plans anymore because of all these issues with them getting paid and things like that. But he always says to me, you know, at the end of the day, Medicare Advantage provides cheaper care. People on low incomes are on these plans on very fixed incomes as seniors. And you know, at the end of the day, Medicare doesn't provide hearing, dental, vision benefits. And if you want those benefits when you have original Medicare, you have to pay a lot more for a supplement plan. So, you know, Medicare Advantage does provide better benefits overall, even if it's a headache for providers sometimes to get paid, you know, for providing those services. So I think that's.

[A]

No, no, he, he has a bias because he's also in the managed care Medicare business.

[B]

Absolutely.

[A]

And, and some would argue that the reality is, yes, there's these other benefits, but the track record so far is it's costing Medicare more than traditional Medicare, not less. So you talk about. So, so this concept and I, I, Dr. Jane Such and Jane is one of the brightest people I know. He's also one of the most straight shooting people I know. But this concept that there's a cost benefit to the country in Medicare Advantage has not played out yet.

[B]

Yes, you know, you're absolutely correct. And I think, you know, diving into a little bit around what CMS has just done this past week goes directly to the heart of that. Scott in terms of, you know, it costs more because there's a lot of, there's a lot of tricky coding that goes on. And I'm putting that's, I think, a very polite way to say it. And so overall, to your point originally, you know, the, the headline figure is the 2.48% rate increase, which translates to about $13 billion more flowing to these private Medicare insurers for 2027. But basically, and that basically when you factor in risk scores over time, the effective increase is actually closer to 5%. So this is, it is good news for MA overall. But, you know, they got 47,000 comments on, on, on what was going on here because of, I think, a lot of the politically loaded changes that they made as well. And so one of these is they're, they're going to be holding firm on A, almost 6% coding pattern adjustment, which is the agency's way of saying, we know Medicare Advantage plans systematically document patients as sicker than those that are in fee for service Medicare. So we're going to be discounting payments to these insurers accordingly. And you know, the insurance industry pushed back on this, but it's basically CMS signaling and saying we're not abandoning scrutiny of upcoding that is making Medicare Advantage more expensive than Medicare even as, even as we're increasing pay for next year. And the other thing that they're going to be doing is they're going to be keeping in the exclusion of diagnoses that are from unlinked chart reviews. And basically that is a direct blow to the fraud and the overpayment scrutiny that we're also talking about. So unlinked chart reviews are basically when an MA plan hires coders to go through the patient record and add diagnoses that weren't actually captured when the doctor or the nurse was in the room with the patient. And we've seen CMS and the DOJ go after plans for this, even just this year with Kaiser, the biggest example of all to date with that over $500 million settlement upcoding. Basically they didn't admit to any wrongdoing, but it's basically CMS making it official that these diagnoses that weren't actually captured in the room, they don't count for risk scores. That basically then gives the plan more money from the federal government. So, so yes, the money's going up on a percentage basis, on a well quantity basis for $13 billion. But there's things being put in place here that make it very clear the federal government knows and is and is responding to the very real upcoding and overpayment trend that in Medicare Advantage.

[A]

Thank you very very much, Jacob. Talk about the pre authorization war and what's going on there.

[B]

Yeah, so there's kind of two different things going on here. There's both CMS parts of a rule that was enacted, finalized back in 2024. Parts of this rule going into effect now starting in January this year, starting then in March and going into next year. Different parts of this rule all basically requiring payers to get better about prior auth over plans that controls Medicare Advantage, Medicaid, Chip, aca. Basically they have to report publicly on all their websites how often they deny prior auth requests, how often appeals are, how denials are overturned by appeal and then certain rules around how, how quickly they make decisions and new electronic requirements between the provider and the payer. So that's all happening. And then last year as well payers, all 50 big ones got together with CMS and basically announced a pledge that for employer plans, fully insured plans, the commercial stuff, that they would also be kind of matching and expanding a little bit on those, those rules that CMS put into place basically saying that they're going to streamline and simplify prior auth for, for the vast majority of Americans. So we've got now we're starting to get back some of the data on how is this all shaking out. And on the commercial side on the pledge, you know again these are just promises from the insurance industry. So I think huge asterisk there. And then the results now is also coming from them through, through surveys of health plans, through ahip, the trade group. So again you kind of have to take some of this with a grain of salt I will say. But they've said they've eliminated 11% of prior auth requirements since last year which and 15% across Medicare Advantage plans. Again that's according to the industry based off of their own promises to, to the government. And then in terms of on the CMS regulations we these metrics went live across their website, the insurance websites on March 31. But there's already, you know, expert analysis being put out saying that it does it kind of like the price transparency rules that went into effect a few years ago that it doesn't offer a lot of insight to the normal everyday person because you can't actually see the reasons why prior auth requests were denied. You can't break it down by specific service categories. So it's kind of like the data is out there but it's so broad, it's so large that the everyday person can't really use it. Kind of making some of these federal transparency efforts, I don't want to say useless, but not, not usable for you and I, at least to start, we're going to have to have private companies probably wade through this data and transform it into more usable stuff for, for the everyday American.

[A]

Well, isn't that the truth of so much of this stuff that actually turning it into practical, useful stuff is very different than the legislative intent or the policy that's put forth? I think that just is right on.

[B]

It seems like it's always CMS says you know, you've got to put out your prices and this is simplifying it. But CMS says you got to put out your prices. The insurers do to, you know, comply with the law, but you know, those prices are hidden in very complicated spreadsheets that are huge that the normal everyday person does not have the computer power to process. So they've complied, but it doesn't actually matter because you and I cannot then go shop based off of pricing. So it's. Yeah, it's another one of those situations where the insurance industry has complied. Is it usable? Not really.

[A]

Right. It sounds all good, but it's not really helpful necessarily. Yeah, I think that's right. Jacob, as always, I learned more in a quick period of time from talking to you than almost anybody else in the world. Thank you so much for joining us today on the Beckers Healthcare podcast. Again, we talked about today, Jacob Emerson on Medicare Advantage and prior authorizations. Thank you so much for joining us.

[B]

Thank you, Scott.