Prior Authorization Process Policies in Medicaid Managed Care: Findings from a Survey of State Medicaid Programs

(By Jada Raphael, Elizabeth Hinton, Aimee Lashbrook, and Kathleen Gifford for The Kaiser Family Foundation Published: Aug 07, 2025)

Medicaid managed care organizations (MCOs) deliver care to three-quarters of all Medicaid enrollees nationally. MCOs often require patients to obtain approval of certain health care services or medications before the care is provided—an insurance practice commonly referred to as “prior authorization”. This allows the MCO to evaluate whether care is covered, medically necessary, and being delivered in the most appropriate setting. If the MCO determines the requested service (or medication) is not appropriate or medically necessary, the MCO may deny the request (fully or partially). Providers and patients have raised concerns that MCO prior authorization processes have the potential to delay or limit access to care. A 2023 report from the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) found that Medicaid MCOs had an overall prior authorization denial rate (12.5%) that was more than double the Medicare Advantage rate (5.7%). OIG found most Medicaid enrollees (89%) do not appeal to the MCO for reconsideration. Of those who do appeal, only about one-third get the initial denial overturned—far less than for Medicare Advantage appeals (82% overturn rate). They also found limited state Medicaid agency oversight. The Medicaid and CHIP Payment and Access Commission (MACPAC) has highlighted similar concerns, making recommendations to improve state monitoring and oversight, transparency, and the enrollee experience. Continue reading here…

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