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Contention or Meaningful Reform? The Long-Awaited CMS Rules for Prior Authorization

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When I think of the prior authorization process, I think not only of the administrative inefficiencies, delayed care, unpaid time spent in peer to peer reviews, and increased costs, but also the eroding of the patient/physician relationship, which leads to burnout in my practice and others around the country. In fact, the American Medical Association (AMA) recently stated the prior authorization process leads to “care delays, patient harm, and practice hassles.” Regarding patient harm, of more than 1,000 physicians surveyed by the AMA, 1 in 3 reported that the prior authorization process led to a serious adverse event in their patients. This has even prompted some physicians to state that prior authorization is a form of practicing medicine without a license, with no substantive consequences for denials or delays in care for a patient that the clinician has not seen or examined.

Overall, the intent of prior authorization was to eliminate unnecessary or inappropriate care, perhaps with some monetary incentives as well. Indeed, by virtue of its effectiveness in reducing bottom line health care spending, prior authorization is one of the most “enduring [and] infuriating” tools in the U.S. It creates further moral injury by extricating the third-party payers while shifting the burden to well-intentioned physicians, who have to directly face the client (the patient) and explain or justify their excuses and unnecessary delays or increased costs in their care. Unfortunately, the prior authorization process has concurrently evolved into an obstacle for otherwise appropriate, time-sensitive patient care that is needed by doctors practicing evidence-based medicine as advocates for their patients the vast majority of the time. 

In January 2024, CMS passed the much awaited “Interoperability and Prior Authorization Final Rule” (CMS-0057-F), expected to save $15 billion by streamlining and digitizing the process while promising to reduce burdens on patients, clinicians, and payers.

The following will soon become necessary parameters for payers to meet:

  • Send decisions within 72 hours for urgent requests, and seven days for non-urgent ones.
  • Include specific reason(s) for denying a request, to allow for timely appeal.
  • Report prior authorization metrics publicly in order to anticipate whether a planned treatment/procedure/diagnostic requires prior authorization and to make the process more transparent.
  • Implement an HL7 interface with EHRs to facilitate electronic communication and automation, helping to avoid unnecessary paperwork that is difficult to track and easily misplaced.

Although this reform certainly feels like a step in the right direction, there has been some healthy skepticism about how this will pan out in “real world” practice. 

  • Will the burden and incentive be shifted to a less defined and less efficient appeals or denials process, which could be more difficult to navigate than the initial prior authorization process due to a lack of set guidelines or streamlined workflows?
  • To whom (patients or payers) will the cost savings from this program be passed on? 
  • Will costs of medications, diagnostics, or procedures themselves rise paradoxically due to the unanticipated effect of more efficient (and thereby increased) care utilization?
  • Will certain specialties or physicians be “penalized” more, due to the cost of their unique therapies, diagnostics, or procedures?
  • Would requiring disadvantaged patients, including those with disabilities, less time, lower education levels, communication/language barriers, or fewer resources overall, to have oversight over their portion of the revised process put them at risk of receiving less equitable care?

Though prior authorization reform seems to be a step in the right direction, with steps incorporated to help reduce burdens for clinicians, patients, and payers as a whole, some concerns remain. While I am relieved by its language to reduce administrative burdens, I query whether it will stand up to the bigger underlying issue and challenge of maintaining, or ideally improving with the promised cost savings, the quality and equity of care provided. I am worried that there may not be adequate monitoring of the new reform rules to evaluate the downstream free market responses and clinicians’ prescribing preferences and patterns, which will naturally change in response to the reform. Would such “bypass” processes dilute the true intent of the rendered policies? 

Ultimately, as physicians and patient advocates, we should recommend that this reform address the concept of value-based health care. We need to challenge our system to address the root cause of the problem by coupling medical and financial responsibility with transparent pricing to physicians and consumers in a free market.

What do you think about these new rules? Share in the comments.

Dr. Phull is a prolific physician-scientist, educator, author, and speaker. He has a passion for cancer care, personalized medicine, and innovation in health care through empathetic leadership. At Palomar Health Medical Group, he is the Director of Oncology and the Chief Medical Officer of Physician Wellness. He also serves as Alumni Specialty Director at the Cleveland Clinic Lerner College of Medicine and as Clinical Instructor at the University of California San Diego.

Image by Yusuf Saibani / Getty Images

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