CMS prior authorization proposal is ‘a good start’ but may not go far enough

Key takeaways

• CMS has proposed changes to the prior authorization process to relieve burdens that plague health care and worsened during the COVID-19 pandemic.
• The proposal would require shorter approval times and implementation of a standard application programming interface to support electronic processes.

The AMA and 118 other leading medical societies recently announced that they have united in support of CMS’ prior authorization reform proposal.

The proposal would require certain payers to implement an electronic prior authorization process by 2026, while also needing to shorten the time frame in which they send responses.

Specifically, the CMS proposal would require the implementation of a “Health Level 7 (HL7) Fast Healthcare Interoperability Resources (FHIR)” standard application programing interface (API) to support and streamline electronic prior authorization. In addition, payers would need to send a decision on urgent prior authorization requests within 72 hours and nonurgent requests within 7 days.

CMS said the proposed changes would “generally apply” to:

• Medicare Advantage organizations;
• state Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs;
• Medicaid managed care plans;
• CHIP managed care entities; and
• Qualified Health Plan issuers on the Federally-facilitated Exchanges.

With these changes, the rule “would improve patient and provider access to health information and processes related to prior authorization for medical items and services,” a CMS spokesperson told Healio.

Pandemic worsens prior authorization burden

Health care professionals have long advocated for changes to the current prior authorization process.

Much of the criticism in the last decade has been directed at burdens induced by the process. According to a 2021 AMA survey, 93% of physicians reported that prior authorization caused delays in care, 82% said the process can sometimes lead to abandoned treatment and 34% said it has resulted in a serious adverse event.

According to Healio Primary Care Peer Perspective Board Member Alexander Kowalski, DO, medical director of Rowan Family Medicine in New Jersey, the amount of staff and patient wait times, as well as navigating each insurance carrier’s specific procedure, are just some of several long-standing issues of prior authorization.

“Every insurance carrier has a slightly different process. Some are online, some are fax and paper or specific forms,” Kowalski told Healio. “In addition, there are pretty significant delays in the response from insurance. If a test is maybe not truly emergent but just urgent, we often see a lot of delays, even up to 2 or 3 weeks, to get patients through the entire initial prior authorization appeal.”

The COVID-19 pandemic exacerbated those issues by causing staffing shortages and extended absences.

“It becomes even more of a stressor and takes up more staff time under those kinds of stressful situations,” Kowalski said.

He added that the approval processes of plans have also seen a heightened aggressiveness “in terms of the amount of documentation they’re requiring, or the consistency with which they’re pushing back or denying studies that previously would have been quickly justified.”

Proposal could be ‘most impactful’ if interoperable with health records

While experts said the proposed changes have the potential to improve prior authorizations, there are questions as to whether they do enough to target and impact the areas that frequently disrupt physician and practice operations.

Speaking to Healio, Brian Outland, PhD, the ACP’s director of regulatory affairs, said that the proposals will be “good for primary care” and “relieve a lot of the burden in information going through.”

“I think namely for our physicians who are in Medicare Advantage plans, it will be quite beneficial,” he said.

However, “it would be most helpful if all insurance companies decided to follow these same rules,” Outland added. “If that could be enforced ... that would be most impactful.”

Efforts to enhance interoperability through FHIR API would be particularly helpful in reducing administrative burdens by improving data exchanges, he said.

“If they are able to make the [API] interoperable with the health records, then I think that will be most impactful because it will take time on physicians having to do a lot of that work manually and getting manual responses to questions,” he said. “If the changes they have proposed work in the way they are proposing, it could be very impactful to have those things automated for them to be able to get into prior authorization information for the insurance company, and then for the insurance company information to come back in a comparable format for their EHR to be able to assess that information and let them know what documentation they’re going to need.”

In December, the ACP applauded the changes and called on CMS to finalize the proposal, a stance that Outland again reiterated.

“I think this, along with the Seniors’ Timely Access To Care bill that’s out there ... if they can reassure that these two things work together, the [ACP] would really support that,” he said.

Outland added that the ACP hopes that “Congress can look at this and say that this is a nice standard for all insurance companies to be able to follow.”

Proposed changes may not go far enough

Kowalski shared similar thoughts on the potential of the changes, deeming them a “good start.”

“A lot of the process improvement in terms of moving more things online and online submission of documentation is definitely much more efficient for staff,” he said.

However, Kowalski pointed out that the proposals could have gone further in addressing the standardization between Medicare and private insurance carriers, that he said is one of the most significant burdens.

“The regulatory changes focus on Medicare and Medicare advantage plans but do not include private payors,” he said. “This represents a large portion of our patients but still leaves a lot of administrative burden in navigating different processes for different payors.”

Although Kowalski acknowledged there are elements in the proposals that attempt to address those concerns, “it’s to be seen what that actually looks like and how much of an impact it has on the day-to-day.”

Ultimately, while Kowalski said he is skeptical that the changes are “going to solve all the issues, I think it’s at least an acknowledgement and a start that this really is one of the main administrative burdens for physician practices of all specialties, particularly primary care.”

References:

• 2021 AMA prior authorization (PA) physician survey. https://www.ama-assn.org/system/files/prior-authorization-survey.pdf. Accessed March 9, 2023.
• Advancing interoperability and improving prior authorization processes proposed rule CMS-0057-P: Fact sheet. https://www.cms.gov/newsroom/fact-sheets/advancing-interoperability-and-improving-prior-authorization-processes-proposed-rule-cms-0057-p-fact. Published Dec. 6, 2022. Accessed March 9, 2023.
• CMS proposes rule to expand access to health information and improve the prior authorization process. https://www.cms.gov/newsroom/press-releases/cms-proposes-rule-expand-access-health-information-and-improve-prior-authorization-process. Published Dec. 6, 2022. Accessed March 9, 2023.
• CMS rulemaking. https://www.cms.gov/Regulations-and-Guidance/Regulations-and-Policies/CMS-Rulemaking. Accessed March 9, 2023.
• Medical societies unite in support of proposed prior authorization reforms. https://www.ama-assn.org/press-center/press-releases/medical-societies-unite-support-prior-authorization-reforms. Published Feb. 13, 2023. Accessed March 9, 2023.