While prior authorization (PA) is intended to control cost and ensure appropriate utilization, the prior authorization process has come under scrutiny for its complexities and potential negative impact on patient care. PA and other formulary restrictions can adversely influence medication adherence, clinical outcomes, and treatment satisfaction.1 Burnout rates among health care providers are soaring and staffing shortages continue to be a challenge. Providers have been pushing back on the increasing burden they are facing with prior authorization requirements, which is exacerbated by increasing Medicare Advantage enrollment where plans require additional prior authorization requirements compared to traditional Medicare.

In recent years, calls for reforming prior authorization have grown louder, prompting action from the Centers for Medicare & Medicaid Services (CMS) as well as several payers. In December, CMS released proposed rules that will go into place in 2026 for Medicare Advantage as well as other Medicaid and Exchange plans that will mandate an electronic process to streamline the process and quickly respond to physician requests.2  The 2024 Final Rule for Medicare Advantage plans released by CMS in April also finalizes impactful changes to ensure people with Medicare Advantage receive access to the same medically necessary care they would receive in traditional Medicare, while streamlining prior authorization requirements and adding continuity of care provisions.3  There are also bills proposed in Congress that aim to overhaul and accelerate the prior authorization process for Medicare Advantage plans. Payers are also taking steps to streamline the process, with UnitedHealthcare announcing that they will remove prior authorization on many procedure codes, which account for nearly 20% of their overall prior authorization volume. They are also implementing a national gold Card program for most procedure codes in 2024 for qualifying provider groups.4

With many practices currently submitting prior authorization requests via fax machine, looking into the future, what will prior authorization look like? If these proposals come to fruition, provider burden should be decreased by automatically pulling required information from the provider’s EMR and submitting the prior authorization electronically to the payer, with the potential for real-time decisions. While this could require substantial investment by both payers and providers upfront, it should, over time, result in decreased administrative burden and more timely decisions.

Beyond technology and policy, as health care transitions to Value-Based care, this also could change the future of prior authorizations. If providers are financially at risk for managing the total cost of care, payers may see less incentive to apply prior authorization to those practices. Gold-carding, such as what has been implemented in Texas at the state level, may also continue to grow as a way of exempting providers that are adherent to evidence-based medicine and with high prior authorization approval rates from prior authorizations.

It will be important for manufacturers to continue to monitor the future of prior authorization reform and how payer management evolves. Once better technology is in place with electronic real-time decisions, will payers may look to be more aggressive with drug management and also have increased success in moving patients to preferred formulary alternatives? Manufacturers may need to adopt their patient support services programs in order to align with the updated prior authorization process to ensure their HUB programs and services support prior authorization submission in the new format. If providers are exempt from prior authorizations in Value-Based agreements, practices may look for data from manufacturers to support the clinical and economic value of a therapy to ensure they are able to deliver high quality cost-effective care.

References:

  1. Salzbrenner, SG, Lydiatt, M, Helding B, et al. Influence of prior authorization requirements on provider clinical decision-making. 2023; 29(7). Jul 13, 2023. https://www.ajmc.com/view/influence-of-prior-authorization-requirements-on-provider-clinical-decision-making.
  2. Centers for Medicare and Medicaid. Advancing Interoperability and Improving Prior Authorization Processes Proposed Rule CMS-0057-P: Fact Sheet. Dec 6, 2023. https://www.cms.gov/newsroom/fact-sheets/advancing-interoperability-and-improving-prior-authorization-processes-proposed-rule-cms-0057-p-fact
  3. Centers for Medicare and Medicaid. 2024 Medicare Advantage and Part D Final Rule (CMS-4201-F). Aug 6, 2023. https://www.cms.gov/newsroom/fact-sheets/2024-medicare-advantage-and-part-d-final-rule-cms-4201-f
  4. Prior authorization reduction equals nearly 20 percent of overall volume. Aug 1, 2023. https://www.uhcprovider.com/en/resource-library/news/2023/medical-prior-auth-code-reduction-august.html