AMA, health groups push for prior authorization reforms in Medicare Advantage plans

Lawmakers fell short in securing approval for prior authorization reforms in Medicare Advantage plans a year ago, but healthcare groups are pressing the Biden administration to make changes this year.

The Centers for Medicare & Medicaid Services has proposed a new rule in December that would revamp prior authorization in Medicare Advantage plans, and providers have said the proposal would make some much-needed improvements.

The American Medical Association and more than 100 medical societies wrote a joint letter to CMS Administrator Chiquita Brooks-LaSure urging the agency to finalize reforms to the increasingly popular plans. The AMA and healthcare organizations say the process of prior authorization, which involves getting approval from insurers for treatments, drugs and services, hurts patient care and contributes to physician burnout.

“We applaud CMS for listening to physicians, patients, federal inspectors, and many other stakeholders, and recognizing a vital need to rein in Medicare Advantage plans from placing excessive and unnecessary administrative obstacles between patients and evidence-based treatments,” Jack Resneck Jr., president of the AMA, said in a statement.

Some of the groups signing the letter include the American College of Surgeons, the American Academy of Family Physicians and the Medical Group Management Association.

Payers argue that the prior authorization process is necessary to control costs and to avoid procedures and services that aren’t medically necessary.

Under the CMS proposal, payers would have to include specific reasons for denying authorization requests. Payers would also have to publicly report prior authorization metrics, CMS said.

Payers would have to send decisions within 72 hours for urgent authorization requests, and seven calendar days for standard requests, which CMS said is twice as fast as the current Medicare Advantage response time limit. CMS is also proposing an electronic prior authorization measure for hospitals, which would require eligible hospitals to report the number of prior authorizations that are requested electronically.

In the letter, the AMA and other groups said prior authorization should only be used to confirm diagnoses or the necessity of treatments. “In other words, PA is not a tool to be used to delay or discourage care,” the letter states.

The health groups also said that once authorization is given, it should remain in place for the duration of treatment. And they said beneficiaries of Medicare Advantage plans should have access to the same services as they would under traditional Medicare.

Doctors argue that they contribute to delays in getting patients the treatment they need, and patients end up paying the price. Nearly all doctors (93%) said prior authorization leads to delays in patient care, while 91% said it had a negative impact on patient outcomes, according to polling by the AMA.

“Waiting on a health plan to authorize necessary medical treatment is too often a hazard to patient health,” Resneck said in the statement.

The administrative burdens consume time and money, and add stress to physicians and their practices, providers argue.

The Office of Inspector General in the U.S. Department of Health and Human Services department has found problems with Medicare Advantage plans denying coverage. In a report issued in April, the office found most requests are approved, but some Medicare Advantage organizations sometimes delayed or denied coverage, even though the requests met Medicare coverage rules.

Medicare Advantage plans are growing increasingly popular. More than 30 million Americans are now enrolled in Medicare Advantage plans, CMS says. Analysts expect Medicare Advantage programs to gain more consumers. KPMG projected that more than half of all Medicare beneficiaries could be enrolled in Medicare Advantage plans by the end of 2023.

Matt Eyles, president and CEO of America's Health Insurance Plans, said in January, “The continued growth of the program is a testament to the tremendous value MA offers to all enrollees, and especially those with chronic illnesses who require care coordination and management, as well as those with low incomes who rely on MA’s access to additional benefits at little or no cost.”

Lawmakers crafted legislation last year that would have streamlined the prior authorization process for Medicare Advantage plans. The House of Representatives approved the bill, but it stalled in the Senate and didn’t win approval before the end of the congressional session.