Health Care Stakeholders Identify Prior Authorization as Ripe for Reform

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The Centers for Medicare & Medicaid Services (CMS) launched the Patients Over Paperwork Initiative in 2017, which seeks feedback from industry stakeholders on ways to reduce administrative burdens in health care and improving the patient experience. This year, CMS received over 560 comments in response to its request for information.

The American Hospital Association (AHA) asserted that providers spend nearly $39 billion each year on administrative activities related to regulatory compliance. Other stakeholders pointed to prior authorization as a problematic practice, with the American Academy of Ophthalmology calling it the “most burdensome requirement in Medicare.” The American Association of Neurological Surgeons argues that patients are experiencing significant barriers to medically necessary care because of prior authorization requirements. Numerous stakeholders called for prior authorization reform in Medicare Advantage plans, but America’s Health Insurance Plans (AHIP) has pushed back, saying that less than 15 percent of covered treatments and services require prior authorization. However, stakeholders agreed that greater automation would reduce the burdens of prior authorization. Greater standardization of prior authorizations would increase the speed at which they are approved and reduce care delays.

CMS has enacted several regulatory reforms as a result of information gathered through the Patients Over Paperwork Initiative, including reforming evaluation and management (E/M) coding, simplifying office visit documentation, and reducing the complexity of the Quality Payment Program. Will prior authorization reform be the agency’s next target?

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