With recent CMS mandates and state-level reforms, the healthcare industry faces a pivotal moment to improve prior authorization processes, ensuring timely access to care and integrating health equity considerations.
CMS Final Rules
Amidst mounting scrutiny from Congress, government watchdogs, and industry stakeholders, the Centers for Medicare and Medicaid Services ("CMS") has introduced a number of new prior authorization (PA) requirements across three Final Rules:
- Contract Year 2024, Medicare Advantage and Part D Final Rule: CMS-4201-F
- Contract Year 2025, Medicare Advantage and Part D Final Rule: CMS-4205-F
- Interoperability and Prior Authorization Final Rule: CMS-0057-F
CMS has already taken immediate action in its audits to ensure compliance with the requirements of CMS-4201-F through focused audits, and similar attention can be expected on the requirements of CMS-4205-F and CMS-0057-F.
Each of these rules have presented new requirements for Medicare Advantage plans which includes provisions that already took effect January 1, 2024 and has introduced new requirements for 2025, 2026, and 2027. Meanwhile, the Interoperability and Prior Authorization Final Rule outlines requirements for Medicare Advantage plans and impacted payers1 who will collectively need to implement several changes. The following timeline provides a high-level description of PA related topics for plans to consider:
2024
CMS-4201-F included key requirements for Medicare Advantage Plans:
- Provisions surrounding the criteria used in PA decision making
- Duration of PA approvals
- Composition and responsibilities of a plan's Utilization Management Committe
2025
CMS-4205-F expanded on requirements from CMS-4201-F for Medicare Advantage Plans:
- Requires the Utilization Management Committee to include a health equity expert to perform an annual health equity analysis of the use of prior authorization at the plan level.
2026
CMS-0057-F discusses changes applicable to impacted payers:
- Notification requirements for impacted payers when a prior authorization determination is made, which includes specific reasons for the denial of the PA request when a request is denied by the payer.
- Timeframe requirements for impacted payers (except QHP issuers on the FFEs) to respond to PA requests.
2027
CMS-0057-F discusses the implementation of Application Programming Interface ("API") for impacted payers:
- Patient API requires impacted payers to include information about certain prior authorizations to be accessible to patients via API.
- Provider API that allows access to patient data from payer to assist with compilation of information for PA submissions.
- Prior Authorization API to sync patient, provider, and payer
through the PA process to provide abilities such as:
- Patient access to status and decision of PA.
- Provider to query PA requirements and submit requests.
- Payer to correspond with providers about PA decisions.
- Payer to Payer API to provide information about a patient's prior authorization(s) from previous payer(s) to a new payer.
State Legislation and Reforms:
In parallel with CMS rulemaking: States are proposing or enacting PA process reforms, including:
- Exemption of certain providers and services from PA requirements.
- Public accessibility of PA information.
Even in the absence of legislative reform, state regulators are leveraging existing oversight initiatives such as audits to dive deeper into plans' PA processes and outcomes.
Importance of Compliance
The new federal and state regulations emphasize the necessity for health plans to:
- Establish and maintain compliant, effective PA processes.
- Ensure timely access to medically necessary care.
- Implement active and comprehensive oversight, monitoring, and governance programs.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
