Reimbursement News

370 Groups Seek Prior Authorization Automation, Reform in MA

The industry groups backed a bipartisan bill that would support prior authorization automation, transparency, and other reforms in Medicare Advantage.

Prior authorization automation

Source: Getty Images

By Jacqueline LaPointe

- The American College of Rheumatology (ACR), along with 369 other patient, physician, and healthcare professional organizations, sent a letter to Congress on Wednesday calling for prior authorization automation and reform in Medicare Advantage.

In the letter, the groups urged members of Congress to pass the Improving Seniors’ Timely Access to Care Act of 2019 (H.R. 3107) recently introduced by Representatives Suzan DelBene (D-WA), Mike Kelly (R-PA), Roger Marshall, MD (R-KS), and Ami Bera, MD (D-CA). The bipartisan legislation aims to protect patients from unnecessary care delays by streamlining and standardizing the prior authorization process in Medicare Advantage.

Ninety-one percent of providers reported care delays stemming from prior authorizations, according to the American Medical Association’s 2018 prior authorization survey of 1,000 practicing physicians. Three-quarters of the physicians also said prior authorizations led to treatment abandonment.

Prior authorization reform is needed to prevent adverse events from occurring due to care delays and treatment abandonment, and Medicare Advantage is the right place to start streamlining the process, the organizations explained.

Medicare Advantage enrollment has nearly double in the last decade, the organizations reported citing data from the Kaiser Family Foundation. Furthermore, about one-third of all Medicare beneficiaries, or 22 million individuals, are currently enrolled in Medicare Advantage plans, and almost four out of five enrollees belong to plans that require prior authorization for some services, the organizations reported.

Additionally, a 2018 HHS Office of Inspector General (OIG) report showed that Medicare Advantage plans overturn 75 percent of prior authorization and claim denials, indicating “widespread and persistent problems” with prior authorizations in the program.

As industry experts anticipate Medicare Advantage enrollment to continue increasing, prior authorization reform is necessary to protect the growing number of Medicare beneficiaries, the organizations stressed in the letter.

The Improving Seniors’ Timely Access to Care Act of 2019 is the right step toward prior authorization reform, they added. Specifically, the legislation would establish an electronic prior authorization program, which has been lacking among Medicare Advantage and other plans.

Only 12 percent of the 182 million medical sector prior authorizations done in 2018 were fully electronic, according to the most recent CAQH Index. With so few prior authorizations conducted in an entirely automated manner, the Council for Affordable Quality Healthcare (CAQH) deemed prior authorizations one of the most manual transactions in healthcare that year.

Prior authorization automation is key to preventing care delays and treatment abandonment, providers and payers have agreed. But the industry still faces a number of challenges with digitizing prior authorizations, including a lack of data consistency, no mandated data standards for clinical documentation, and manual interventions required by some states, CAQH recently reported.  

The bipartisan legislation from the House Representatives would attempt to overcome the challenges of prior authorization automation by establishing a program that would require electronic transmission of prior authorization requests and responses and a real-time process for items and services that typically require a prior authorization.

The bill would also improve transparency by requiring plans to report to CMS on their prior authorization use and rate of approvals or denials. Transparency would also improve under a requirement that would mandate plans to adopt prior authorization programs that adhere to evidence-based medical guidelines and are reviewed annually.

Improving transparency for prior authorizations is a top priority for leading industry groups seeking to reform the process. Last year, the American Hospital Association (AHA), America’s Health Insurance Plans (AHIP), American Medical Association (AMA), and three other industry groups developed five strategies to streamline the prior authorization process, including increasing transparency and communication between stakeholders.

The organizations called for greater transparency through increased use of existing national standard transactions for electronic prior authorizations (i.e., National Council for Prescription Drug Programs [NCPDP] ePA transactions and X12 278), adoption of national standards for electronic exchange of clinical documents, development of software that uses standard electronic transactions, and electronic communication of up-to-date prior authorization and step therapy requirements.

The bill would set the stage for similar transparency requirements, as well as hold plans accountable for making timely prior authorization determinations and prohibit additional prior authorizations for medically necessary services performed during a surgical or invasive procedure that already received or did not initially require prior authorization.

“This bipartisan legislation would help protect patients from unnecessary delays in care by streamlining and standardizing prior authorization under the Medicare Advantage program, providing much-needed oversight and transparency of health insurance for America’s seniors. We urge you to join your colleagues in supporting this important legislation,” the organizations wrote.