Dive Brief:
- CMS has finalized a sweeping rule revamping electronic prior authorization, a scant month from first proposing it as the Trump administration hustles to codify its health agenda before the inauguration of President-elect Joe Biden on Wednesday.
- The rule requires payers with plans in Medicaid, the Children's Health Insurance Program and those operating on the federal exchanges to use standardized application programming interfaces to give providers and patients electronic access to prior authorization data, including pending decisions. It also requires payers to issue faster decisions on prior authorization requests.
- Insurers would see the biggest impact from the rule, leading payer lobby America's Health Insurance Plans to lambast it as "a series of empty promises," "shabbily and hastily constructed" and "half-baked" in a Friday statement.
Dive Insight:
Prior authorization, the process in which a physician must get the green light from a patient's insurer for medication or treatment before administering it, has grown in popularity among insurers as a way to cut down on unnecessary or expensive care. Providers generally loathe the process as yet another administrative hoop to jump through, and finger it as a major contributor to physician burnout and potentially harming patient care.
The rule, first proposed Dec. 10, is meant to streamline the process by improving electronic data exchange, building off interoperability regulations the Trump administration finalized in March.
Though providers were generally supportive of the rule when first proposed, insurers slammed it, calling the implementation timeline too quick and arguing it would add unnecessary burden on a health system dealing with the pandemic and other regulatory changes.
Additionally, the comment period on the rule was extraordinarily tight: Following publication on the Federal Register, industry had only 17 days to analyze the 100-page rule and draft comments. Usually, comment periods are between 30 and 60 days.
AHIP asked CMS for another 45 days to review the rule — a suggestion the agency clearly disregarded, codifying the rule just five days before Biden shepherds in a new health administration, leaving any unfinalized Trump-era policies in regulatory purgatory.
"CMS wants to ensure that the policies can be implemented timely, so they can have a positive impact on patients, providers and payers," a CMS spokesperson said in response to a question about the speedy turnaround.
AHIP clearly does not agree.
"Today's final rule from CMS is largely a series of empty promises. This shabbily and hastily constructed rule puts a plane in the air before the wings are bolted on by requiring health insurance providers to build these technologies with incomplete and untested instruction manuals," the lobby's CEO Matt Eyles said.
"Miraculously, the Administration was able to provide the ‘reviews’ and ‘responses’ in less than nine business days despite over 250 stakeholders filing thousands of pages of public comments. This was wholly inadequate to allow stakeholders to conduct appropriate analyses and was clearly not consistent with the thoughtful notice-and-comment approach to developing policies that is customarily afforded a rule estimated to cost nearly $3 billion to implement," Eyles continued.
The API provisions of the rule will kick into gear in 2023. Beginning in 2024, payers, with the exception of qualified health insurers on the federal exchanges, now have a maximum of 72 hours to issue prior authorization decisions on urgent requests and 7 calendar days for standard requests.
Medicare Advantage plans aren't included in the final rule, but CMS is considering further rulemaking to make them subject to similar requirements.
That omission was a major hangup for hospital groups, which argued excluding the private plans — which cover about a third of Medicare beneficiaries — could result in more variation in prior authorization processes in the U.S., and reduce incentives for providers to adopt the new standardized methodology.
"The notable exclusion of MA plans is extremely troubling and significantly reduces the potential impact of the regulation," the American Hospital Association wrote in its comments on the proposed rule.