The HHS Office of Inspector General found that Philadelphia-based Community Behavioral Health — a Pennsylvania behavioral health Medicaid managed care organization — did not comply with federal and state requirements when denying behavioral health service requests that required prior authorization.
The audit covered Jan. 1, 2023, through Dec. 31, 2023. During that period, CBH denied 1,102 of 96,130 behavioral health service requests requiring prior authorization. Enrollees filed grievances for 63 denials, and CBH overturned 13 of those grievances, according to a June 2026 report.
CBH had the highest number of denied services requests of any behavioral health Medicaid managed care organization in the state, sparking the investigation.
Here are four things to know:
- None of the sampled denials met all requirements. OIG reviewed a random sample of 100 denied service requests from 2023 and found that none met all applicable administrative and procedural requirements. The agency concluded that none of the 1,102 service requests denied during the audit period complied with all federal regulations and state requirements.
- Every sampled denial lacked required information about access to records. All 100 sampled denial notices failed to inform enrollees of their right to obtain, upon request and free of charge, copies of all documents and records relevant to the denial. OIG attributed the issue in part to Pennsylvania’s denial notice templates.
- OIG identified multiple administrative deficiencies. Among the 100 sampled denials, 17 notices were sent to incorrect addresses, one denial should have been automatically approved because notification was not issued within required timeframes, 14 notices contained unclear adverse benefit determinations and 34 denials involving enrollees younger than 21 lacked required consultation documentation.
- OIG issued recommendations to both CBH and Pennsylvania. OIG made five recommendations to CBH, including updating policies related to address verification, timely notifications, denial notice language and consultation requirements for enrollees under 21. The agency also recommended that Pennsylvania revise its denial notice template. Pennsylvania concurred with the recommendation addressed to it, while CBH said it concurred with two findings, and outlined corrective actions it has taken or plans to take.
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