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CMS piles on prior auth requirements 

CMS piles on prior auth requirements  ‘That’s a big deal,’ industry stakeholders say

Andrea StarkYARMOUTH, Maine – A rule finalized in January is CMS’s latest bid to fine-tune the prior authorization process for Medicare Advantage plans and other payers to increase efficiency and transparency. 

The agency in January finalized a rule requiring MA plans and other payers like Medicaid and Medicaid managed care to send prior authorization decisions within 72 hours for urgent requests and seven calendar days for standard requests. For some payers, CMS says, this cuts the current timeframe in half. 

“In our comments, we requested an expedited, 24-hour response for life-sustaining items like non-invasive ventilators, but at least having that standardization is helpful,” said David Chandler, senior director of payer relations for AAHomecare. “When dealing with Medicare Advantage plans, suppliers can still negotiate contracts and stipulate a tighter timeframe, but again, at least there is a standard.” 

The rule also requires impacted payers to include a specific reason for denying a prior authorization request, which CMS says will help facilitate resubmissions of the request or an appeal when needed, and publicly report prior authorization metrics. 

Those metrics will go a long way toward increasing transparency by MA plans, says Andrea Stark, a Medicare consultant and reimbursement specialist with MiraVista. 

“That is going to be meaningful,” she said. “If they have a high percentage of first-pass denial rates, it likely signals the plans are not simply affirming medical need, but rather delaying payment or imposing new criteria. When they do start posting metrics, we’ll want to remember that (traditional) Medicare has an error rate that’s below 2%. That should be the goal for all MA plans, too.” 

Additionally, the rule requires impacted payers to implement a Health Level 7 (HL7) Fast Healthcare Interoperability Resources (FHIR) Application Programming Interface (API) to streamline communication and automate the prior authorization process. The rule requires a provider access API, a payer-to-payer API, a prior authorization API and a patient access API. 

“It will be interesting to see how that improves the workflow,” Chandler said. “We sometimes hear on the DME side that prior authorizations are taking weeks and you can’t get a status update for the patient. That information is going to be able to go through the API and be available directly to patients (who opt-in) within one business day through their health app. That’s a big deal.” 

These requirements don’t go into effect until 2026 (prior authorization decision timeframe and patient access API) and 2027 (remaining APIs), but other related requirements did go into effect this past January. One of them: A mandate that Medicare Advantage plans do not impose prior authorization requirements for 90 days if there are changes in insurer and the patient has active service

“It’s still early in the year, but we need to ensure these payers are in compliance with the new requirements,” Stark said. “Suppliers need to leverage those rights in their communications if payers aren’t in compliance, because this is going to launch us leagues ahead of where we have been.” 

  • Andrea Stark and Jeff Baird will co-host a webcast on Medicare Advantage plans, prior authorizations and other important industry updates on Thursday at 1 p.m. EST. Register here


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