The call for comprehensive prior authorization reforms continues to be a leading issue among healthcare providers. In 2018, six national healthcare advocacy associations released a Consensus Statement outlining recommendations for reforming prior authorization, https://www.ama-assn.org/practice-management/prior-authorization/prior-…. At its core, prior authorization is an insurer’s utilization management program intended to evaluate the efficiency, appropriateness, and medical necessity of the treatments and services its members receive. Of course, the standard of care may vary by specialty, geography, or other factors not accounted for in policy making. Healthcare providers must continuously navigate prior authorization requirements, which can cost significant amounts of time and practice resources and affect patient care.
In December 2021, the American Medical Association (AMA) surveyed 1,000 practicing physicians about their experience with prior authorization.
88% of respondents reported that prior authorization generates high or extremely high administrative burden for their practices.
Practices complete an average of 41 prior authorizations per physician per week and spend an average of almost two business days a week completing prior authorizations.
40% of respondents reported that they have secured additional staff to work exclusively on prior authorization, including keeping up with varied requirements across payers.
93% of physicians reported that prior authorization led to delays in patient care at least some of the time.
34% of physicians said prior authorization issues contributed to a serious adverse event for a patient in their care.
This recent survey data confirms that prior authorization issues continue to pose significant challenges for both physicians and patients, and that many of the recommended reforms in the Consensus Statement a few years ago have yet to be widely implemented by health plans. The COVID-19 pandemic created additional challenges for prior authorization and further highlighted the need for a legislative solution.
During the 2021-2022 California legislative cycle, Senator Richard Pan (D-Sacramento), introduced SB 250 to attempt to address the prior authorization issue and alleviate some of the administrative burdens placed on physicians.
SB 250 would:
Prohibit a healthcare service plan (health plan) or health insurer, on or after January 1, 2024, from requiring a contracted health professional to complete or obtain a prior authorization for any healthcare services if the health plan or insurer approved or would have approved not less than 90% of the prior authorization requests they submitted in the most recent one-year contracted period.
Establish standards for this prior authorization exemption and its denial and appeal.
Authorize a plan or insurer to evaluate this exemption not more than once every two years.
Prohibit a plan or insurer from rescinding an exemption outside of the end of the two-year period.
As of late August, with only a few days left before this year’s session adjourns, SB 250 had been stalled in the Assembly Appropriations committee, short of the necessary votes to move on to a full floor vote in the Assembly and out of time to reintroduce in its same form in the 2023 legislative session.
Meanwhile in July 2022, Congressional legislators in the House Ways and Means Committee unanimously advanced the Improving Seniors Timely Access to Care Act of 2022. Meant to put guardrails on Medicare Advantage (MA) plan prior authorization requirements, the bill would increase transparency around MA prior authorization requirements, standardize the prior authorization process for routinely approved services, and establish an electronic prior authorization program. Although not yet passed, this bill had immense support, including 280 cosponsors, a Senate companion bill, and endorsement from almost 400 organizations across the healthcare industry.
Although no concrete solutions have yet been reached, and while congressional efforts are narrowly tailored to the MA population, it is worth noting that there are now 28 million Medicare beneficiaries and counting enrolled in MA plans. As opposed to a patchwork of state laws on the issue of prior authorization (as we are experiencing with No Surprise Billing), federal reforms implemented at the MA level can ultimately lead to similar reforms industry wide, and achieve greater uniformity in PA practices.
2021 AMA Survey: https://www.ama-assn.org/system/files/prior-authorization-survey.pdf
Gabriela Villanueva is CAP’s Government and External Affairs Analyst. Questions or comments related to this article should be directed to GVillanueva@CAPphysicians.com.