Health groups cheer House passage of prior authorization reform bill

The House passed a bill to streamline authorization requirements in Medicare Advantage plans. The measure now moves to the Senate.

Healthcare organizations have been pushing for reforms in the prior authorization process, and they’re seeing some momentum in Washington.

With bipartisan support, the House of Representatives passed a bill Wednesday that critics say would revamp the prior authorization process in Medicare Advantage plans. The bill now heads to the U.S. Senate.

A companion bill in the Senate has 42 co-sponsors, so healthcare advocates are hoping the Senate will pass the measure by the end of the year.

With 28 million seniors participating in Medicare advantage plans, it’s time to reform the prior authorization process, said U.S. Rep. Suzan DelBene, D-Wash., the sponsor of the House bill.

“We must deliver a quality product that allows providers to keep our seniors as healthy as possible, while reducing wait times, paperwork and hassle,” DelBene said on the House floor Wednesday. “Unfortunately, the cumbersome and antiquated prior authorization process that many Medicare Advantage plans utilize often gets in the way.”

Jack Resneck Jr., president of the American Medical Association, applauded the House passage Wednesday.

“You don’t have to be a congressional insider to read the tea leaves behind House passage today of a bill to reform the onerous prior authorization process afflicting patients and physicians,” he said in a statement. “Two major House committees – Ways and Means as well as Energy and Commerce – overwhelmingly endorsed the bill, and it passed the full House in a rare show of bipartisan support.”

“While health care legislation often divides Congress, here is a bipartisan way to improve patient health. The tea leaves suggest this can get done this year,” Resneck added.

Providers must submit prior authorization requests to insurers to get approval for many drugs and treatments. While insurers say prior authorization is necessary to control costs and avoid wasteful spending, healthcare organizations have long complained the process hurts patient care and contributes to burnout among healthcare professionals.

The House bill would establish an electronic prior authorization process, something healthcare technology advocates have urged for years. The Council for Affordable Quality Healthcare (CAQH) said in a report issued in January that 35% of prior authorizations were still fully manual, meaning they were submitted by phone, fax, email or mail. DelBene said Wednesday, “It’s 2022, and even Congress has moved beyond faxing.”

Medicare Advantage plans would be required to report to the Centers for Medicare & Medicaid Services how often they are using prior authorization and the rate of approvals and denials. The bill would also require the U.S. Department of Health and Human Services to establish a process for “real-time” decisions for services that are regularly approved.

“The House recognized that prior authorization is an insurance companies’ practice that is overused, costly, opaque, burdensome to physicians, and harmful to patients due to delays in care,” Resneck said.

Healthcare groups said some insurers eased prior authorization requirements early in the pandemic, but they said the demands have grown more onerous.

Anders Gilberg, senior vice president of government affairs for the Medical Groups Management Association, said the legislation “would significantly improve the prior authorization process in the Medicare Advantage program.”

“Year after year, delays in coverage decisions, inconsistent payer payment policies, and unsustainable prior authorization volumes act as significant impediments to delivering medically necessary care,” Gilberg said in a statement. “At a time when group practices face unprecedented workforce shortage challenges, 89% of MGMA members report they do not have adequate staff to process the increasing number of prior authorizations from health insurers.”

The transparency provisions in the bill, including how many prior authorizations are approved and the length of time for the requests, will force insurers to be more accountable, Gilberg said.

The MGMA said it’s optimistic the Senate will approve the bill this year. “MGMA urges the Senate to move swiftly to consider this bill, helping to ensure our nation’s seniors have unobstructed access to the high-quality healthcare they deserve,” Gilberg said.

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

Doctors have seethed over the prior authorization process for years. 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 an AMA poll released in February 2022.

The American Academy of Ophthalmology has been pushing for the bill as well. “This important fix to prior authorization is one step closer to becoming law,” the group said.

The efforts to reduce prior authorization demands come as Medicare Advantage plans are gaining in popularity.

Medicare Advantage plans are expected to cover over 50% of Medicare-eligible beneficiaries nationwide by 2025, according to a report from Trella Health. Between December 2016 and February 2022, enrollment in MA plans rose by 65.1%.