Reform of the prior authorization process under the newly issued final rule by the Centers for Medicare & Medicaid Services (CMS) will reduce patient care delays as well as the administrative burdens long shouldered by physicians, while saving practices an estimated $15 billion over the next decade.
While we will continue to fight for additional reforms, this is a huge win for both doctors and patients who have borne the brunt of a broken system used by insurers for years to control the costs of care by inappropriately delaying or even denying courses of treatment approved by their physicians. The AMA worked relentlessly to secure this victory, one critical step in a larger effort to ensure physicians aren’t weighed down by excessive paperwork and that patients receive the timely care that they require.
The need to rightsize prior authorization has never been greater. Mountains of administrative busywork, hours of phone calls, and other clerical tasks tied to the onerous review process not only rob physicians of face time with patients, but studies show also contribute to physician dissatisfaction and burnout.
More than one-third of physicians surveyed by the AMA reported that prior authorization has led to serious adverse health outcomes for patients in their care, including avoidable hospitalizations, life-threatening events, permanent disabilities and even death.
Reforming this burdensome, time-wasting process requires a holistic approach that protects continuity of care, improves the validity of coverage criteria, boosts the transparency of processes used by health plans, and greatly reduces patient care disruptions. CMS Administrator Chiquita Brooks-LaSure deserves our thanks for previously bringing forth a final rule that just took effect to rightsize the prior authorization process imposed on medical services and procedures by Medicare Advantage plans.
The newest CMS final rule, which takes effect in 2026 and 2027, represents another significant step in that agency’s comprehensive plan to improve prior authorization. Among other advancements, this latest effort electronically streamlines the prior authorization process for physicians providing medical services under:
- Medicare Advantage plans.
- State Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs.
- Medicaid managed care plans and CHIP managed care entities.
- Qualified health plans on federally facilitated exchanges.
Progress on additional fronts
Momentum is clearly building toward meaningful prior authorization reform at the state level as well. The AMA continues to work closely with our partners in the Federation of Medicine to provide model legislative language, talking points, data and other resources to advance prior authorization reforms in legislatures across the U.S.
Here too, our work is making a difference. More than 17 states have already adopted comprehensive prior authorization reforms—many of them based on the AMA model legislation. And as 2024 state legislative sessions get underway, there are already more than 70 prior authorization reform bills of varying shapes and sizes in 28 states, which suggests we will continue to see advancements this year at the state level.
And we’re seeing some progress on reform in the private sector as well. Cigna and United Healthcare, two of our nation’s largest insurers, outlined voluntary reform efforts to reduce prior authorization hassles. It remains to be seen how significant these changes will be, but they represent a victory for physicians and patients who have long been frustrated by excessive prior authorization demands.
Insurers know the pressure is on. Policymakers know the pressure is on. This progress may not be as fast as we all want, but it is happening. And physicians can feel good about that.
A Recovery Plan pillar
Reducing the administrative burden posed by prior authorization is one of five pillars comprising the AMA Recovery Plan for America’s Physicians, along with:
- Reforming Medicare payment to promote thriving physician practices and innovation.
- Supporting telehealth to maintain gains in coverage and payment.
- Stopping scope creep that threatens patient safety.
- Reducing physician burnout and addressing the stigma around mental health.
This five-point strategy will strengthen our physician workforce and improve health care delivery by eliminating some of the most common pain points that threaten to drive physicians from practice. Each of these objectives is within our grasp, and achieving them will streamline health care delivery, improve patient care, and support further innovation.
These latest gains in prior authorization reform are important. But they represent just the start of what the AMA intends to achieve in collaboration with our Federation partners. Together we continue to make significant progress on each of the five initiatives outlined in the Recovery Plan. But there is much more work to be done. The AMA will continue to fulfill our role as the physician’s powerful ally in patient care throughout 2024 and beyond.
