CMS Proposed New Rule Tackles Prior Authorization Issues

The Centers for Medicare and Medicaid Services (CMS) proposed a new rule to streamline prior authorizations and improve electronic healthcare data transfers between doctors, patients and insurance companies. The rule will require payers involved in certain government programs to build apps for the purpose of this exchange and prior authorization.

From CMS Administrator Seema Verma, in a statement:

This proposed rule ushers in a new era of quality and lower costs in health care as payors and providers will now have access to complete patient histories, reducing unnecessary care and allowing for more coordinated and seamless patient care. Each element of this proposed rule would play a key role in reducing onerous administrative burden on our frontline providers while improving patient access to information.

Healthcare Finance News reports that the rule would reduce the time providers wait for prior authorization decisions, proposing a maximum of 72 hours with the exception of qualified health plans (QHP) in the federally-facilitated exchange, according to Healthcare Finance.

Any insurers that coordinate with Medicaid, Children’s Health Insurance Program (CHIP) and QHPs would be required to participate. According to Fierce Healthcare, CMS said that it is considering including Medicare Advantage plans in a similar future rule, but not in this proposal.

Fierce Healthcare reports that in 2018, a consensus statement from major insurer lobbyist groups requested improvements to the prior authorization process. But the American Medical Association requested in June that Congress should step in to enact legislation requiring reforms to the prior authorization rule. From AMA President Susan Bailey:

Almost two and a half years after our consensus statement, the sad fact is little progress has been made toward the reform goals. The health insurance industry’s failure to achieve agreed-upon improvements illustrates a clear need for legislation.

According to HF, the American Hospital Association had a mixed reaction to the exchange rule. From Ashley Thompson, AHA senior vice president of public policy analysis and development:

While prior authorization can be a helpful tool for ensuring patients receive appropriate care, the practice is too often used in a manner that leads to dangerous delays in treatment, clinician burnout and more waste in the healthcare system. The proposed rule is a welcome step toward helping clinicians spend their limited time on patient care… [AHA is disappointed that CMS] chose not to include Medicare Advantage plans, many of which have implemented abusive prior authorization practices, as documented in our recent report. we urge the agency to reconsider and hold Medicare Advantage plans accountable to the same standards.

Read more at Medical Economics.

CMS Proposed Rule Factsheet.