CMS Proposes Major Changes to Prior Authorization

Under a proposed new rule, the Centers for Medicare & Medicaid Services (CMS) will require certain payers to automate their pre-authorization processes, respond more quickly, provide reasons for denials and make certain metrics public, the agency announced Tuesday.

If implemented, the proposed rule would require “affected payors” to share pre-authorization decisions within 72 hours for expedited requests and 7 calendar days for “non-emergency” requests and would require payors to include specific reasons for refusals.

The proposal would also require certain “eligible” providers and hospitals to report actions related to the adoption of electronic prior authorization.

Doctors and medical groups applauded the agency’s actions, calling the proposal a “positive step forward.”

Prior Authorization, Interoperability

Prior authorization requirements require providers to seek approval from payers before patients can receive certain medical items or services.

The process is intended to ensure that items are covered or medically necessary, but many patients and providers find the process cumbersome and, for providers, expensive and a major source of burnout. For patients, the process can be disruptive and delay care — in some cases, to the point that patients drop out of treatments altogether, according to a CMS fact sheet.

To achieve these goals, CMS proposed requiring affected payers to “build and maintain a vendor access API [Application Programming Interface] share patient data with network providers with whom the patient has a processing relationship. »

The change would allow providers to know when pre-authorization is needed, what documentation is required, and allow providers to exchange requests and decisions from the electronic health record (EHR) or a practice management system.

In addition to reducing the decision window and requiring reasons for denials – which the agency says could improve communication between payers and providers and potentially help achieve “successful resubmissions” of claims to the Future – CMS proposed to require affected payers to publicly report certain authorization metrics annually.

Additionally, as a requirement of a previous policy finalized, under which payers were mandated to establish a patient access API for Rapid Healthcare Interoperability (FHIR) resources, the agency now proposes to require regulated payers to include data on patient prior authorization decisions “to help patients better understand their payer’s prior authorization process and its impact on their care,” notes the fact sheet. of information.

Additionally, CMS has proposed requiring payers to exchange patient data – which, among other information, would include prior authorization requests and decisions – whenever a patient switches health plans, with the caveat that patients must opt ​​in to data sharing.

And for patients with concurrent coverage by two or more payers, the relevant payers would be required under the proposed rule to make those patients’ data available to the concurrent payer at least quarterly.

Affected payers, according to the fact sheet, would include:

• Medicare Advantage Organizations

• State Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs

• Medicaid Managed Care Plans and CHIP Managed Care Entities

• Qualified Health Plan Issuers on Federally Facilitated Exchanges

However, the proposed deadlines would not apply to qualified health plan issuers on exchanges facilitated by the federal government, the agency noted.

Supplier-focused measures

In addition to the payer-focused policy changes, the agency also proposed new measures to encourage “eligible hospitals” and critical access hospitals under Medicare’s Promoting Interoperability Program, and for “eligible clinicians” under the merit-based incentive payment system, to promote the adoption of electronic prior authorization processes.

Specifically, these vendors would be responsible for reporting the number of pre-authorizations requested electronically via a pre-authorization requirements, documentation and decision API using data from certified EHR technology.

Tuesday’s proposed rule also “officially withdraws” the previous proposed rule on CMS interoperability and pre-clearance (85 FR 82586).

The agency also requested policy feedback in the following areas:

• Barriers to Adoption of Social Risk Data Standards

• Ways to Promote Data Sharing with Behavioral Health Providers

• How Medicare Fee for Service can improve the electronic exchange of medical information between and among providers, suppliers and patients

• Ways to strengthen prior authorization policies that impact maternal health outcomes

• How the Trust Exchange Framework and Common Agreement Can Help Promote Changes in the Proposed New Rule

The agency also specifically requested comment on the proposed timeline for expedited and standard (non-urgent) requests and asked if a narrower decision window – such as 48 hours and 5 calendar days for expedited and standard requests, respectively, for example – would be preferred.

Stakeholders react

A number of doctors and medical groups applauded the proposals.

“The average physician spends too long completing pre-approvals, which takes up patients’ time and potentially creates dangerous delays in care,” said American Academy of Family Physicians (AAFP) President Tochi Iroku- Malize, MD, MPH, MBA, in a press. Release.

“The rule is good news for family physicians and an important first step in easing the burden and improving access to care,” she added, noting, however, that “more comprehensive reform” is still needed. to reduce the number of prior authorization requests that have to be processed.

The American Hospital Association (AHA) also applauded the agency’s efforts to remove “inappropriate barriers to patient care” and was particularly pleased that Medicare Advantage programs were included in the scope of the rule.

“Prior authorization is often used in a way that results in dangerous delays in care for patients, overwhelms health care providers, and adds unnecessary costs to the health care system,” wrote Ashley Thompson, vice -AHA Senior Chair, Public Policy Analysis and Development, in a press release.

Similarly, the MGMA was “encouraged” by the proposal and inclusion of Medicare Advantage plans, calling the “onerous methods” and the current volume of prior authorization requests “unsustainable.”

“An alarming number of medical groups report completing prior authorization requests via paper forms, over the phone, or through various proprietary online payment portals…An electronic prior authorization program, if implemented from appropriately, has the potential to ease administrative burden and enable practices to reinvest resources in patient care,” said Emily Dowsett of the MGMA in an email to MedPage Today.

The AAFP and AHA continued to push for passage of the “Improving Timely Access to Care for Seniors Act,” which the AHA said would “codify these protections into law.” “.

If implemented, the new policies will take effect on January 1, 2026, and the first set of proposed measures will be communicated on March 31, 2026.

Washington editor Joyce Frieden contributed to this story.