Industry ‘ready’ for prior auths

Friday, April 11, 2014

WASHINGTON – Industry stakeholders support CMS’s plans to expand the PMD demo—with a few tweaks.  

“I’m all for it,” said Peggy Walker, billing specialist at VGM. “I’m ready for more prior auths.”

In an April 4 emergency Federal Register notice, CMS detailed plans to expand the prior authorization program to Pennsylvania, Ohio, Louisiana, Missouri, Maryland, New Jersey, Indiana, Kentucky, Georgia, Tennessee, Washington and Arizona, bringing the total number of demo states to 19. 

“I’m just wondering what’s the emergency to add 12 more states and, if they’re going to add 12 more states, why don’t they think about rolling this out nationally,” said Martin Szmal, founder of The Mobility Consultants.

Stakeholders are working on that, they say. In response to a Senate Finance Committee request, they have drafted language that would expand the demo to all 50 states, and expand its scope to cover all PMDs, said Seth Johnson, vice president of government affairs at Pride Mobility, who said a possible mini-Medicare bill before the August recess is being eyed as a potential vehicle.

That language would see the development of an electronic submission process and standardized documentation collection tool, similar to systems used by Medicaid and private payer systems, he said.

“We believe there’s a lot of efficiencies, certainly from the payer perspective, that would allow them to make decisions in a more timely manner and ultimately save the system significant dollars,” said Johnson.

With any expansion of prior authorizations, CMS needs to allow adequate time for education, and for contractors to train staff to absorb additional workloads, said Don Clayback, executive director of NCART.

“There have been some bumps in the road but overall the program, once it got started, was a good example of CMS and the industry working together to meet everyone’s needs without restricting consumer access,” he said. 

Issues still to be ironed out: the complexity of documentation; a lack of transparency regarding what requirements suppliers and physicians miss; and how many denied applications are approved upon resubmission, stakeholders say.

Still, stakeholders are optimistic that any increase in prior authorizations will have a smoother transition, said Michael Blakey, president of DMEevalumate.

“There will be initial learning pains and those that adapt will thrive and those that don’t adapt, we won’t be talking about them in a couple of years,” he said. 

CMS has asked for the Office of Management and Budget for a decision by April 18.


Dear Industry, Be careful what you wish for. Prior authorization does have the theoretical potential to streamline documentation and billing procedures, as well as eliminating back-end claims risk from future audits.  However, in its current form, it will allow CMS to enforce its draconian audit standards on the front end of all claims.  A quick read of any trade journal from the last year will highlight the perils of CMS's current audit scheme.  CMS has used these absurd and unrealistic standards to deny 70% - 100% of any claims audited - across all suppliers and across all poducts and services.  Instead of simply wishing and waiting for CMS to transform prior authorizaton into a clear, rational and objective process - PLEASE get involved.  Contact CMS and OMB about this process and demand those changes before the program expands beyond control.

Good luck!