No more take backsies. That is the AMA’s message for payers who force patients and physicians to meet burdensome documentation requirements in order to prior authorize or precertify care and then—after the care has been delivered—decide to back out of paying or try to recoup payment already made. Insurers will frequently cite vague reasons such as overpayment on their part, a redetermination that approved care was not medically necessary or incomplete paperwork.
Insurers are increasingly requiring patients and physicians to undergo extensive precertification or prior authorization processes for diagnostic and surgical procedures. This adds layers of documentation and approval hurdles and delays care for patients, says a resolution introduced by New York delegation at the 2024 AMA Interim Meeting in Orlando, Florida.
Physicians report that these requirements, which involve submitting procedural codes and fulfilling rigorous documentation demands, are time-consuming and labor-intensive. Meanwhile, insurers often have ample opportunities and time to ask for additional information at various stages in the process.
That is why many state legislatures are considering a “gold card” program—such as in Texas where there has been some success—that would waive certain prior authorization requirements for eligible physicians, aiming to alleviate administrative strain. Yet even prior authorized procedures are sometimes denied for payment afterward, compounding the frustration and creating further administrative burdens for health systems and medical practices.
“Prior authorization should be sufficient to guarantee payment,” said Marilyn J. Heine, MD, a member of the AMA Board of Trustees. “It is unacceptable that a health plan gives a green light to medically necessary care and then retains or creates barriers to payment. It's an affront to physicians, patients and employers; and leads to financial strain for practices and families.”
To that end, the AMA House of Delegates adopted policy to “support the position that the practice of retrospective denial of payment or payment recoupment for care which has been precertified by an insurer should be prohibited under federal statute, except when materially false or fraudulent information has knowingly been given to the insurer by the physician, hospital or ancillary service provider to obtain precertification.”
Delegates also directed the AMA to:
- Continue to advocate for legislation, regulation or other appropriate means to ensure that all health plans, including those regulated by ERISA, pay for services that are preauthorized or pre-certified by such health plan, including services that are deemed preauthorized or pre-certified because the physician participates in a ‘gold card’ program operated by that health plan.
- Encourage legal action against health plans that engage in inappropriate post-service payment denials and payment recoupment.
This newly adopted policy will strengthen the AMA as it fights to fix prior authorization by challenging insurance companies to eliminate care delays, patient harms and practice hassles.
Survey details how patients are harmed
Insurance companies’ overuse of prior authorization is causing patients real harm—in some instances even resulting in death. Nearly 25% of the 1,000 physicians the AMA surveyed (PDF) in late 2023 reported that prior authorization has led to a serious adverse event for a patient in their care, including 7% who said prior authorization led to a patient’s disability or permanent bodily damage, congenital anomaly or birth defect or death.
Prior authorization reforms are needed. Explore how the AMA is pushing for change and what progress is being made to fix prior authorization.
Patients, doctors and employers can learn more about reform efforts and share their personal experiences with prior authorization at FixPriorAuth.org.
Read about the other highlights from the 2024 AMA Interim Meeting.
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Get the latest news on the AMA’s fight to eliminate care delays, patient harm and practice hassles.
