Mar 7, 2023

State & Federal Reforms Mean Prior Authorizations May Be Changing in 2023

Hannah Orlousky   |   Updated June 29   |  Reading time: 3 minutes

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Regulations for prior authorization requirements have increased in recent years, with a 2022 Medical Group Management Association (MGMA) survey finding that 79% of medical groups reported requirements increasing over the last year. Similar results were found in MGMA’s 2016, 2017, and 2019 surveys.

However, 2023 may finally bring changes to prior authorization requirements. Several states have already enacted legislation to curb requirements, with others planning to follow suit. The Centers for Medicare & Medicaid Services (CMS) has also issued a proposed rule to address administrative burdens and patient treatment delays caused by complex prior authorization requirements. While legislation is fought over this year and beyond, physicians can rely on built-in electronic prior authorization features to streamline processes and reduce denials as well as delays.

Which States Are Changing Prior Authorization Rules?

According to AHIP, as many as 42 states could introduce bills to limit or change prior authorization this year. To date, 26 bills have been introduced in 16 states to streamline prior authorizations for procedures, tests, treatments, and medications. 

West Virginia, Louisiana, Michigan, and Texas have passed what’s known as gold card legislation, and New York, Colorado, Indiana, Kentucky, Mississippi, and Oklahoma have introduced similar legislation with more states, including Ohio, yet to come. The gold card law allows physicians with a specified prior authorization approval rate over six months to bypass prior authorization requirements on certain services and procedures. The purpose of gold card legislation is to improve clinical outcomes for patients and reduce the administrative burdens on healthcare practitioners, spreading up the time to care.

What is CMS’s Proposed Rule to Streamline Prior Authorization?

CMS has issued a proposed rule to streamline prior authorization processes and facilitate the sharing of health information. Regarding prior authorization, the proposal includes the following requirements for certain payers:

  • Implementation of electronic prior authorization processes (specifically a Health Level 7® (HL7®) Fast Healthcare Interoperability Resources® (FHIR®) standard Application Programming Interface (API))

  • Shortening the timeline for responses to prior authorization requests (within 72 hours for expedited requests and within seven calendar days for standard requests)

  • Policies to make the prior authorization process more efficient and transparent

  • Include reason for request denials

  • Electronic Prior Authorization measure for eligible hospitals, critical access hospitals under the  Medicare Promoting Interoperability Program and for Merit-based Incentive Payment System (MIPS) eligible clinicians under the Promoting Interoperability performance category

These requirements would apply to Medicare Advantage (MA) organizations, state Medicaid and Children’s Health Insurance Program (CHIP) agencies, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan (QHP) issuers on the Federally-facilitated Exchanges (FFEs).

This rule has received wide support from physicians; the American Medical Association and nearly 120 physician associations sent a letter of support to CMS on February 13, 2023. The letter cites data regarding prior authorization from a recent AMA survey. The survey found that 93% of physicians report care delays or disruptions associated with prior authorization, and 34% report prior authorization leading to a serious adverse event for a patient in their care. A reported 91% view prior authorization as negatively impacting clinical outcomes for their patients.

How Do We Make Prior Authorizations and Health Information Sharing More Efficient?

Part of the 21st Century Cures Act, ONC’s Cures Act Final Rule of 2020 states that healthIT developers are required to update and provide customers with Fast Healthcare Interoperability Resources-based (FHIR) application programming interfaces (certified application programming interface or API technology) by December 31, 2022. This information network allows for the linking of data across systems and includes a communication network for data exchange between systems. Software that meets these requirements makes it easier for practices to facilitate electronic health information sharing. Make sure your electronic health records (EHR) software includes these capabilities.

Likewise, electronic prior authorization (EPA) can help physicians share key information, streamline processes, prevent delays, and avoid related adverse events for patients. RXNT’s enhanced ePA feature allows you to set priorities for urgent requests, automatically initiate requests for medications that may require prior authorization, pre-populate answers from patient charts, hold prescriptions until the request is approved, and more.

New developments with prior authorization will continue to occur in the near future. Are you prepared? Stay one step ahead with RXNT’s built-in ePA and ONC-certified medical office software.

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