Changes to prior authorizations may be on the horizon

Leaders seek physician comments on rule proposals for electronic records, Medicare Advantage plans.

Federal health care leaders say they are committed to helping physicians, patients, and health insurance companies by improving the prior authorization process for medical care.

On Jan. 17, Center for Medicare & Medicaid Services Administrator Chiquita Brooks-LaSure and U.S. Surgeon General Vice Admiral Vivek H. Murthy, MD, MBA, held a listening session with health care stakeholders. That was followed by a conference call with news media to explain changes under consideration:

  • Streamline the prior authorization process for physicians and patients.
  • Create new standards for electronic attachments and signatures relating to health care documents.
  • Strengthen rules for people enrolled in or seeking coverage from Medicare Advantage plans or Medicare Part D prescription drug plans.

“These proposed actions will significantly streamline the prior authorization process for clinicians, improve the health care experience for people we serve and ensure they can access the care that they need,” Brooks-LaSure said.

Murthy cited his own May 2022 advisory, “Addressing Health Worker Burnout,” and how paperwork burdens with prior authorization add to it.

“It's hard today to find a clinician or a patient who hasn't been adversely affected by prior authorization,” Murthy said. “Clinicians should not have to spend hours each day fighting for their patients to access evidence-based care and treatment. And patients should not have to deal with the uncertainty of not knowing whether or not they can get the care that they need and deserve.

“Our goal is to ensure efficient, transparent, and effective prior authorization policy to ensure accountability and ultimately to eliminate care delays and harm,” he said.

Other speakers included Meena Seshamani, MD, PhD, CMS deputy administrator and director of the Center for Medicare, and Mary Green, MD, MPH, MBA, CMS director of the Office of Burden Reduction and Health Informatics.

Prior auths

In its announcement of December 2022, CMS noted “patients, providers, and payers alike have experienced burden.” Prior authorizations have contributed to physician burnout and pose a health risk for patients if the process causes delays in receiving health care.

The new rule would require:

  • Denial reasons. Payers would supply specific reasons for denying prior authorization requests to improve communication and facilitate a successful resubmission, if needed.
  • Quicker turnaround: Prior authorization decision would be required in 72 hours for expedited, or urgent, requests and seven days for standard, or nonurgent, requests. CMS said its leaders want comment on shorter times, such as 48 hours for urgent requests and five calendar days for nonurgent requests.
  • Prior authorization metrics. Payers would report publicly their numbers online each year.

The proposed rules generally would apply to Medicare Advantage organizations, state Medicaid and Children’s Health Insurance Program (CHIP) agencies, Medicaid managed plans, CHIP managed care entities, and Qualified Health Plan issuers on the federally facilitated exchanges. The rules are published online and CMS has an open comment period on it through March 13.

If finalized, the new policies on prior authorizations would take effect Jan. 1, 2026.

Health care attachments

In a separate but related proposal, CMS is considering new standards for “health care attachments” transactions, such as medical charts, x-rays, and provider notes for physician referrals, and office or telemedicine visits. In the call, Brooks-LaSure noted health care clinicians currently use facsimile machines and paper mail to submit medical charts, x-rays, or notes – and may “spend hours figuring out what documentation is required for prior authorization.”

The Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA) require the U.S. Department of Health and Human Services to adopt a health care claim attachment standard. The new standards would apply to entities governed by HIPAA, including health plans, health care clearinghouses, and health care providers.

The proposed rule and a fact sheet are published online and CMS is seeking comments on the proposals until March 22.

Medicare Advantage

Prior authorization also is part of a third proposed rule that would change regulations for Medicare Advantage plans. The rule would:

Require MA plans to develop and use coverage criteria and policies so MA enrollees have the same access to necessary care they would receive in traditional Medicare.

Streamline prior authorizations by requiring prior authorizations to remain valid for an enrollee’s full course of treatment.

Revise regulations on Medicare Advantage plan marketing to avoid confusion and pressure on enrollees.

Add behavioral health services through clinical psychologists, licensed clinical social workers, and prescribers of medication for opioid use disorder.

Comments on the new regulations are due Feb. 13.

How much money?

CMS estimates the new policies regarding prior authorizations would create efficiencies that save $15 billion over 10 years for physician practices and hospitals.

Using a fully electronic system for prior authorizations, the health care industry could save an estimated $454 million a year, according to CMS, which cited a 2019 report by the Council for Affordable Quality Healthcare. Standardizing electronic health records, attachments, and signatures for claims, the health care industry could save an estimated $374 million a year, for a total savings of $828 million a year for prior authorizations and claims.