8 updates for Hospital Prior Authorizations in 2022 Implemented from January 2023

8 Prior Authorizations Updates for Hospital

There have been several updates and developments related to streamlining the prior authorization process in the healthcare industry in 2022, making it complicated for hospitals and health systems. These updates include:

1. The Centers for Medicare and Medicaid Services (CMS) issued a proposed rule that aims to streamline the process and estimates that it will save hospitals and medical practices over $15 billion over a decade.
2. The Governor of Pennsylvania signed a law that requires insurers to provide timely approval for non-urgent and emergency healthcare services before they are rendered and to conduct peer reviews by specialists if the necessity of a service is questioned.
3. Blue Cross Blue Shield of Massachusetts, Florida Blue, and other payers implementing strategies to reform their prior authorization systems.
4. The effects of a Texas law coming into effect, which exempts physicians with a 90% approval rate for certain services from prior authorization requirements for those services.
5. The U.S. House of Representatives passed a bill to reform the Medicare Advantage prior authorization process, which is still under consideration in the Senate.
6. The Office of the Inspector General for the Department of Health and Human Services released a report finding that some Medicare Advantage Organizations delayed or denied access to services even though the requests met coverage rules.
7. Four revenue cycle leaders share their ideas for changing the prior authorization process.
8. The Governor of Michigan signed a bill that shortens the time insurers have to consider prior authorization requests and requires them to provide more information about the process to the public and providers.

Centers for Medicare and Medicaid Services has put forward a new rule that aims to increase access to healthcare information and streamline the prior authorization process:

The Centers for Medicare & Medicaid Services (CMS) has proposed a rule that aims to improve patient and provider access to health information and streamline prior authorization processes for medical items and services. The rule would require certain payers to adopt an electronic prior authorization system, reduce the timeframes for responding to prior authorization requests, and establish policies to make the process more efficient and transparent. It also proposes to require certain payers to implement standards for data exchange between payers when a patient changes coverage or has concurrent coverage, which is intended to help ensure complete patient records are available during transitions between payers. This proposal is part of the Biden-Harris Administration’s efforts to increase health data exchange and invest in interoperability.

Some of the key takeaway points for this effort are:

• CMS Administrator Chiquita Brooks-LaSure stated, “CMS is dedicated to improving access to high-quality care and making it easier for clinicians to provide that care. The proposed improvements to the prior authorization process and interoperability that we are announcing today would streamline the prior authorization process and enhance data sharing in healthcare to improve the care experience for providers, patients, and caregivers. These proposals aim to address avoidable delays in patient care and promote better health outcomes for everyone.”

• The proposed rule by the Centers for Medicare & Medicaid Services (CMS) aims to address issues with the prior authorization process experienced by providers and patients. It includes the requirement for certain payers to implement a Health Level 7 (HL7) Fast Healthcare Interoperability Resources (FHIR) standard application programming interface (API) for electronic prior authorization, and to provide a specific reason for denying requests, publicly report certain prior authorization metrics, and respond to expedited requests within 72 hours and standard requests within 7 days. The rule also proposes the addition of a new Electronic Prior Authorization measure for eligible hospitals and critical access hospitals under the Medicare Promoting Interoperability Program, and for Merit-based Incentive Payment System (MIPS) eligible clinicians under the Promoting Interoperability performance category, in an effort to further support a streamlined prior authorization process.

• The proposed requirements by the Centers for Medicare & Medicaid Services (CMS) would generally apply to Medicare Advantage organizations, state Medicaid and Children’s Health Insurance Program agencies, Medicaid managed care plans, managed care entities like CHIP, and issuers of Qualified Health Plan on the Federally-facilitated Exchanges. These requirements aim to promote alignment across different coverage types and are estimated to save physician practices and hospitals over $15 billion over a 10-year period.

The proposed rule by the Centers for Medicare & Medicaid Services (CMS) includes requests for information on standards for social risk factor data and the electronic exchange of behavioral health information. Behavioral health providers are working to improve the exchange of medical documentation in the Medicare Fee-for-Service program through the Trusted Exchange Framework and Common Agreement (TEFCA) and by considering the role of interoperability.

This rule is intended to improve patient access to care, reduce administrative burdens for clinicians, and support interoperability in the healthcare system. It replaces a previously proposed rule published in December 2020 and addresses public comments received on that proposal. 

The public, including patients, families, providers, clinicians, consumer advocates, health care professional associations, and individuals serving underserved communities, is encouraged to submit comments on the proposed rule by March 13, 2023.

4 Solutions can be used for a better prior authorization process:

There are a few different approaches that hospitals and health systems can take to streamline and improve their prior authorization process. Here are a few options:

Automation: One way to make the prior authorization process more efficient is to use automated systems to handle certain tasks. For example, you could use software to automatically check insurance coverage, send prior authorization requests to payers, or track the status of requests.

Standardization: Another approach is to standardize the prior authorization process across your hospital. This could involve creating a set of standard forms or templates for use by all providers, or implementing a standard process for requesting prior authorization.

Collaboration: It can also be helpful to work with payers, pharmacies, and other stakeholders to find ways to improve the prior authorization process. For example, you could collaborate with payers to develop more efficient prior authorization procedures, or work with pharmacies to improve the way that they handle prior authorization requests.

Education: Finally, it’s important to educate providers, staff, and patients about the prior authorization process, so that everyone understands their roles and responsibilities and can work together more effectively.