Most industry stakeholders support CMS push for prior authorization reform

The proposed rule from the Centers for Medicare & Medicaid Services addressing prior authorization has been getting mostly positive reviews from industry stakeholders, though many organizations representing providers are hoping CMS will consider even bolder reforms. 

Unveiled in December 2022 and open for public comment until March 13, the proposed rule seeks to make the prior authorization process faster and more transparent for Medicare Advantage, Medicaid, Children’s Health Insurance Program, and Qualified Health Plans.  

Proposed changes include the following: 

• Require adoption of the Fast Healthcare Interoperability Resources (FHIR) standard Application Programming Interface (API) to support electronic prior authorization. 
• Cut in half the existing response time limit for prior authorization requests allowed under Medicare Advantage, currently six days for expedited requests and 14 days for standard requests.  

• Add an Electronic Prior Authorization measure for eligible hospitals under the Medicare Promoting Interoperability Program and for Merit-based Incentive Payment System (MIPS) eligible clinicians. 
• Expand the existing Patient Access API to include information about prior authorization decisions. 

CMS has estimated that prior authorization reforms would save providers $15 billion over a 10-year period. The proposed changes are also poised to make care more accessible; a 2021 survey from the American Medical Association (AMA) noted that 93% of physicians report care disruptions associated with prior authorization, while 91% view prior authorization as having a negative impact on clinical outcomes. These frustrations, coupled with the persistence of phone- and fax-based workflows, has even led Surgeon General Vice Admiral Vivek Murthy to link prior authorization to clinician burnout. 

By and large, industry stakeholders support the proposed rule – and have their own thoughts on how to strengthen it.  

The Medical Group Management Association (MGMA) made several recommendations. These include ensuring that a board range of provider types sit on insurers’ utilization management committees, prohibiting step therapies, including prescription drugs in clinical validity and transparency of coverage criteria, and creating “gold card programs” that exempt providers from prior authorization if they reach a certain approval rating from a given health plan. (The AMA, in a letter signed by 118 other medical societies, similarly expressed support for gold cards and prescription drug inclusion.)  

Meanwhile, AHIP applauded the potential for patients to share their data and called for additional safeguards for personal health information shared with entities currently not required to comply with HIPAA. 

The Blue Cross Blue Shield Association, on the other hand, seems to think CMS has gone too far. Its comments described the proposed rule as “prescriptive” and warned that allowing longer transition periods for approving ongoing treatments could contribute to increased utilization of unnecessary medical services. 

The push for prior authorization reform stems in part from an investigation last year by the Office of Inspector General, which found that 13% of prior authorization denials from Medicare Advantage plans actually met the coverage rules for original, fee-for-service Medicare. Similarly, 18% of denied payment requests from Medicare Advantage met Medicare coverage rules. A separate report from the Kaiser Family Foundation found that just 11% of denials were appealed, though 82% of appeals resulted in denials being at least partially overturned. 

Prior authorization reform is also happening at the state level. Texas and West Virginia have gold-carding laws on the books, while Michigan’s Health Can’t Wait Act shortens authorization timelines, requires authorizations to be based on evidence-based criteria, and prohibits anyone with a financial stake in an authorization decision to be part of the decision-making process.  

Brian Eastwood is a Boston-based writer with more than 10 years of experience covering healthcare IT and healthcare delivery. He also writes about enterprise IT, consumer technology, and corporate leadership.