More than a year after it was initially proposed, the Biden administration announced a final rule yesterday that will change how insurers in federal programs such as Medicare Advantage use prior authorization — a long-standing system that prevents many patients from accessing doctor-recommended care.
“When a doctor says a patient needs a procedure, it is essential that it happens in a timely manner,” Health and Human Services Secretary Xavier Becerra said in a statement. “Too many Americans are left in limbo, waiting for approval from their insurance company.”
Sometimes called pre-authorization or pre-certification, prior authorization requires patients and their doctors to seek approval from insurers before proceeding with a treatment, test or medication. Insurer payment is often contingent upon obtaining prior authorization, which may be demanded for everything from expensive cancer care to prescription refills.
Elizabeth Spencer, 71, of Lebanon, Tenn., said her Medicare Advantage plan requires her to get preapproval for continuous glucose monitoring supplies every 90 days. Spencer was diagnosed with Type 1 diabetes when she was 12 and estimated that she spends an hour every week on prior authorization requirements.
“I have to get a new prior authorization every time I am about to run out of supplies,” she said. “What part of that makes sense to anyone with half a brain?”
As Spencer’s experience shows, the process can be confusing and lengthy. Denials are common and appeals are often difficult to navigate. Doctors say some people end up dying while waiting for an insurer’s permission for care.
Beginning in 2027, the Centers for Medicare and Medicaid Services will require some insurers to adopt an electronic process for prior authorization. They’ll have to respond to expedited prior authorization requests within 72 hours and to standard requests within seven days.
Insurers affected by the rule also must provide a specific reason for denying prior authorization requests and will be required to publicly report prior authorization data annually on their websites, among other changes.
But the new rule goes only so far, affecting just insurers doing business in federal programs, such as Medicare Advantage and Obamacare exchanges. Notably, it doesn’t cover insurance that some 158 million Americans get through their jobs — the most common kind of coverage in the United States.
KFF surveys show that “this population has problems with prior authorization almost as much as those with [Affordable Care Act] marketplace, Medicaid and Medicare” coverage, said Kaye Pestaina, director of KFF’s Program on Patient and Consumer Protection.
“So I imagine there will still be calls for changes and transparency for these plans, mostly regulated by the Department of Labor,” she said.
The new rule also doesn’t cover prior authorization for prescription drugs, Pestaina added. CMS has indicated it will deal with that issue separately.
In the past year, KFF Health News has heard from hundreds of patients who’ve had to endure insurance preapprovals for care. While originally promoted as a way to make the health-care system more efficient by eliminating unnecessary or duplicative treatment, prior authorization is now widely unpopular among doctors and patients.
“Family physicians know firsthand how prior authorizations divert valuable time and resources away from direct patient care,” Steven Furr, president of the American Academy of Family Physicians, said in a statement yesterday. “We also know that these types of administrative requirements are driving physicians away from the workforce and worsening physician shortages.”
Furr said the new rule “marks significant progress,” adding: “We need congressional action to cement this vital progress.”
Although the new rule doesn’t apply to all of their plans, some insurance companies have taken steps to improve prior authorization for all of their customers, in anticipation of the CMS crackdown. AHIP, an industry trade group formerly called America’s Health Insurance Plans, said the new federal rule is a “step in the right direction.”
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