Simplification Push Yields Major Prior
Authorization Win

As the Academy called for following CMS' December 2022 proposal, the final rule will expand and strengthen the electronic prior authorization system for Medicare Advantage plans, dramatically lessen the decision-making timeframe for prior authorization requests and require payers to more efficiently share clinical and claims data when patients transfer between plans. The rule, which begins rolling out Jan. 1, 2026, governs Medicare Advantage payers, state Medicaid and CHIP fee-for-service programs, Medicaid managed care plans, CHIP managed care entities and Qualified Health Plan issuers on the federal exchanges.

The rule “marks significant progress to address care delays and the administrative burden physicians and their patients face daily,” AAFP President Steven Furr, M.D,, FAAFP, said in a statement quoted by The Washington Post and other media.

Medical Group Management Association research notes that nearly 90% of physicians say prior authorizations are very or extremely burdensome; 97% of physicians report that their patients have experienced delays or denials for medically necessary care due to prior authorization requirements.

To address these and related issues, the final rule requires payers to implement an automated process for physicians to determine whether a prior authorization is required, identify prior authorization information and documentation requirements, and facilitate the exchange of prior authorization requests and decisions from physician EHRs or practice management systems — steps the Academy strongly supported.

The rule further mandates that payers

• provide a reason when denying a PA request, regardless of how the request was submitted;

• send standard PA decisions within seven calendar days, with expedited decisions within 72 hours (which the Academy will continue advocating to shorten); and

• publicly report certain metrics about their PA processes annually on their websites, including the percentage of PA requests approved, denied and approved after appeal, as well as the average time between submission and decision.

It also compels plans to add information about prior authorizations (except prescription drugs) to patient-access portals, as the Academy urged. The move should improve patients’ access to their health information and promote transparency. Plans also will have to share patient data with in-network physicians with whom the patient has a relationship.

In a related win, a final rule issued in December by the Office of the National Coordinator for Health Information Technology answers the AAFP’s advocacy by laying out a timeline for specifying Fast Healthcare Interoperability Resources standards and implementation guides across all payers. The Academy favored such a move, saying it would lessen confusion, delays and administrative burden, but called for real-world testing before implementation.

The rule’s adoption smooths the path for the Improving Seniors’ Timely Access To Care Act, a bipartisan bill meant to reform prior authorization that stalled in 2022 following a high cost estimate by the Congressional Budget Office. The Academy is calling for reintroduction and passage of this legislation.

Complementing this advocacy, the AAFP last month called on CMS to follow through on proposed rulemaking that would advance standards for electronic prescribing, including updates allowing real-time prior authorization and formulary confirmation.  

A recording of a Jan. 19 Workgroup for Electronic Data Interchange webinar and discussion is available online, as well as a separate CMS webinar and related slides.