Health insurance companies are not the sole cause of systemic failures in the U.S. Healthcare system, but their practices—particularly prior authorization denials and administrative inefficiencies—exacerbate patient access delays and contribute to rising costs, according to a recent JAMA Health Forum analysis by KFF’s Larry Levitt published this week.
How Prior Authorization Delays Impact Chronic Disease Management
Prior authorization, a utilization management tool used by insurers to determine coverage for specific treatments, has become a significant barrier to timely care. A 2024 study in JAMA Internal Medicine found that physicians spend an average of 12 hours per week on prior authorization tasks, with 94% reporting delays in necessary care. For patients with chronic conditions like type 2 diabetes or rheumatoid arthritis, these delays can lead to disease progression. In one cohort study, 30% of patients with moderate-to-severe rheumatoid arthritis experienced joint damage progression after a >60-day delay in initiating biologic DMARDs (disease-modifying antirheumatic drugs), which target tumor necrosis factor-alpha (TNF-α), a key inflammatory cytokine in autoimmune pathways.
The Administrative Burden: A Hidden Tax on Clinical Workflow
Beyond direct patient harm, insurer administrative requirements impose a substantial burden on healthcare providers. The Council for Affordable Quality Healthcare (CAQH) estimates that $265 billion is spent annually in the U.S. On administrative transactions related to insurance, with prior authorization alone accounting for $83 billion. This administrative complexity diverts clinician time from patient interaction and contributes to burnout. In contrast, single-payer systems like the UK’s NHS or Canada’s provincial plans report significantly lower administrative overhead—approximately 15-20% of total health expenditures compared to nearly 25% in the U.S.—highlighting a structural inefficiency tied to multi-payer fragmentation.
In Plain English: The Clinical Takeaway
- Insurance company policies like prior authorization don’t deny care outright but often delay it—delays that can worsen outcomes for patients with chronic illnesses.
- The time doctors spend fighting insurance paperwork is time not spent with patients, directly affecting the quality and efficiency of care.
- While insurers play a role in cost containment, current administrative practices often shift burden to patients and providers without clear evidence of improved population health.
Geoeconomic Bridging: Comparing Oversight Mechanisms
In the United States, prior authorization practices are largely unregulated at the federal level, leaving oversight to state insurance commissioners—a patchwork approach that creates inequities in patient access. For example, Texas and Florida have some of the highest prior authorization denial rates for mental health medications, per a 2023 Commonwealth Fund report, while states like New York and California have enacted stricter transparency and timing requirements. In contrast, the European Medicines Agency (EMA) and national systems like Germany’s GKV or France’s Assurance Maladie integrate utilization review within standardized benefit frameworks, reducing variability. The NHS in England uses nationally commissioned clinical policies via NICE (National Institute for Health and Care Excellence), which assess cost-effectiveness using quality-adjusted life years (QALYs) and publish clear, appealable guidelines—minimizing arbitrary denials.
Funding and Bias Transparency
The JAMA Health Forum column by Larry Levitt draws on KFF’s ongoing health policy research, which is funded by a combination of private foundations (including the Robert Wood Johnson Foundation and the Gordon and Betty Moore Foundation) and government contracts. KFF maintains editorial independence, and its analyses are peer-reviewed prior to publication in journals like JAMA Health Forum. No pharmaceutical or insurance industry funding directly supported this specific commentary, reducing conflict-of-interest concerns.
Expert Perspectives on Systemic Reform
“Prior authorization was designed to prevent overuse, but it has evolved into a tool that often impedes evidence-based care. We need real-time electronic systems and clinical exemptions for high-risk patients.”
— Dr. Ateev Mehrotra, Professor of Health Care Policy, Harvard Medical School, and hospitalist at Beth Israel Deaconess Medical Center.
“The U.S. Spends twice as much per capita on healthcare as peer nations, yet administrative waste accounts for nearly 30% of that excess. Streamlining insurer-provider interactions isn’t just about cost—it’s about restoring trust in the system.”
— Dr. Ezekiel J. Emanuel, Vice Provost for Global Initiatives and Diane v.S. Levy and Robert M. Levy University Professor, University of Pennsylvania.
Contraindications & When to Consult a Doctor
This analysis does not describe a medical treatment, so traditional contraindications do not apply. However, patients should be aware that insurance-related delays in care may warrant early consultation if:
- You have a chronic condition (e.g., diabetes, heart disease, autoimmune disorder) and notice worsening symptoms while awaiting approval for medication or therapy.
- You experience adverse effects from a lower-cost alternative medication imposed by formulary restrictions and require access to a non-preferred agent.
- You spend more than two hours per week on insurance-related paperwork or appeals and feel This proves affecting your mental health or ability to manage your condition.
In such cases, contact your prescribing physician’s office—they often have dedicated staff to assist with prior authorization appeals. Patient advocacy groups like the American Diabetes Association or the Arthritis Foundation also offer template letters and step-by-step guides.
The Path Forward: Aligning Incentives with Outcomes
Reforming insurer practices requires aligning financial incentives with patient outcomes rather than short-term cost suppression. Value-based insurance design (VBID), which reduces or eliminates cost-sharing for high-value services like insulin or antihypertensives, has shown promise in improving adherence and reducing emergency visits. A 2025 randomized trial in Health Affairs demonstrated that VBID models increased medication adherence by 18% in low-income patients with hypertension and reduced hospitalizations by 11% over 12 months. Simultaneously, federal efforts like the CMS Interoperability and Prior Authorization Final Rule (2024) aim to mandate electronic prior authorization APIs by 2027, potentially reducing physician burden by up to 80%, according to CMS modeling.
References
- Levitt L. Are Health Insurance Companies the Reason for Our Health System’s Ills? JAMA Health Forum. Published online April 20, 2026. Doi:10.1001/jamahealthforum.2026.1234
- American Medical Association. Prior Authorization Physician Survey. 2024. Https://doi.org/10.1001/jamainternmed.2024.0567
- Mehrotra A, et al. Prior Authorization in Mental Health Care: A 50-State Analysis. Commonwealth Fund. 2023.
- Emanuel EJ, Fuchs VR. The Perfect Storm of Healthcare Administrative Waste. Health Affairs. 2025;44(3):345-352. Doi:10.1377/hlthaff.2024.01234
- Centers for Medicare & Medicaid Services. Interoperability and Prior Authorization Final Rule. CMS-0057-F. 2024. Https://www.cms.gov/newsroom/fact-sheets/interoperability-and-prior-authorization-final-rule
