January 26, 2024
Prior Authorization Final Rule
CMS finalized a new regulation titled “Advancing Interoperability and Improving Prior Authorization (PA) Processes for Medicare Advantage (MA).” The rule is intended to streamline the health plan prior authorization processes, promote greater transparency into medical necessity criteria, and improve the electronic exchange of health care information. To automate the prior authorization process, CMS will require the implementation of Fast Healthcare Interoperability Resources (FHIR)-based Application Programming Interfaces (APIs). The new APIs will require payers to implement technology that enables providers to determine whether a service is subject to PA. The rule also outlines new timeframes for prior authorization decisions and requires payors to publicly report certain metrics. While the rule is a positive step, it doesn’t address many other issues impacting prior authorization (e.g. retrospective denials) and it will take long to implement — most requirements won’t be enforced until 2026 and the API requirements will take effect on January 2027. In the meantime, we expect state legislatures across the country to debate ways to improve prior authorization and make insurers more accountable. For a detailed summary of the final rule, click here.