2023 Prior Authorization Initiatives

2023 Prior Authorization Initiatives

As a physician, you know that prior authorization has increasingly become a headache for your staff and patients. An Oct. 2021 MGMA survey found that 88% of providers felt that prior authorization requirements are “very or extremely burdensome,” an increase from 82% in 2018. Policymakers are starting to take notice of how prior authorization requirements are worsening the administrative burden on providers and ultimately impacting the quality of care for patients.

A report released last April from the HHS Office of Inspector General led to increased scrutiny of Medicare Advantage’s (MA) prior authorization practices. The report found that 13% of prior authorization requests were improperly declined despite meeting Medicare’s coverage rules.

Last year Congress failed to pass the Improving Seniors’ Timely Access to Care Act, which would have required MA plans to streamline the prior authorization process. As a result, the Centers for Medicare and Medicaid Services (CMS) proposed two new regulations. The first rule, proposed on Dec. 6, 2022 by CMS, would require Medicare Advantage (MA), Medicaid, and CHIP plans to create a streamlined electronic prior authorization process, effective on Jan. 1, 2026.

The proposal would require the applicable health plans to:

  • implement a Fast Healthcare Interoperability Resources-based Application Programming Interface (API) to enable prior authorization requests to be facilitated in a timely manner.
  • provide a determination to providers and patients within 72 hours for urgent requests, and seven days for ordinary requests.

The new API, named the Prior Authorization Requirements, Documentation and Decision (PARDD) API, would allow for the electronic and secure transmission of patient data between providers and applicable health plans.

CMS released a second proposed rule on Dec. 14, recommending reforms to how MA and Part D plans utilize prior authorization. Under the proposed rule, MA plans would be required to:

  • provide current evidence in widely used treatment guidelines or literature to CMS and providers when developing internal coverage criteria (where no Medicare statute, National Coverage Determinations or Local Coverage Determination exists) to classify whether a service should be covered.
  • to utilize a medical professional with experience in the field relevant to the service associated with a prior authorization request.
  • provide a 90-day continuity of care transition period when an enrollee switches MA plans while receiving treatment for a medical issue.
  • alert their beneficiaries if a primary care or behavioral provider is dropped from their network.

The proposal also targets MA plans’ advertising practices. For example, plans would be prohibited from using the Medicare name and logo in their marketing materials and would be required to disclose the name of their plan in their advertising.

While these proposed rules are a step toward a more streamlined, less burdensome prior authorization process, it is important to understand that – if eventually passed – they are only enforceable towards CMS-regulated health plans. However, the momentum to reform the prior authorization process at the federal level is expanding to state legislatures. States have the authority to regulate non-Medicare commercial health plans, and plenty of states are proposing their own prior authorization reforms that would impact private health insurance markets.

ACAAI’s state legislative tracking efforts are monitoring 28 bills that have been proposed to address prior authorization across the country. Generally, these bills would require private health plans to act on prior authorization requests in a timely manner and require health plans to standardize their prior authorization processes by implementing an electronic portal.

We will continue to monitor the latest developments on this issue. There is optimism that a more efficient and streamlined prior authorization process is on the horizon, allowing providers to spend more time providing patient care.