Health Plan Payment and Reimbursement

Little progress seen in mitigating prior-authorization challenges

June 23, 2019 10:02 pm

Despite a 2018 payer-provider agreement on a process overhaul, hospital executives and physician surveys say prior authorization (PA) challenges have worsened.

In “Reforming the Prior Authorization Process,” a Sunday workshop at HFMA Annual Conference 2019, attendees heard about a 2018 American Medical Association (AMA) survey that reported 50% of physicians believe PA burdens “increased significantly” over the last five years. Another 38% believed such burdens “increased somewhat.”  

Similarly, 82% of the session’s attendees — most from hospital organizations — said PA administrative burdens have “increased significantly” over the last five years, and another 18% said it “increased somewhat.”

Such burdens were supposed to ease after the January 2018 signing of a consensus statement by the AMA, American Hospital Association, America’s Health Insurance Plans, American Pharmacists Association, Blue Cross and Blue Shield Association, and Medical Group Management Association.

Consensus areas addressed in the statement included:

  • Selective application of PA
  • PA program review and volume adjustment
  • Transparency and communication about PA
  • Continuity of patient care
  • Automation to improve transparency and efficiency

“There’s a lot of talk and people are trying to get started on it — but as Elvis would say, we need a little less conversation and a little more action because things really are not moving quite as quickly as we would have hoped,” said Heather McComas, director of administrative simplification initiatives for the AMA.

Shortcomings of the PA consensus agreement

A specific area where the consensus agreement appears to have fallen short is in the availability of health plans with programs that exempt providers from PA. Only 8% of physicians surveyed by AMA in 2018 reported contracting with health plans that offered such programs.

Among areas that have gotten worse, 88% of physicians said PA required for prescription medications has increased over the last five years, and 86% said PA has increased for medical services.

Additionally, 69% of physicians said it was difficult even to determine whether a prescription or medical service required PA.

The result has been a real impact on patients, said providers. In the AMA survey, 85% of physicians said PA interferes with continuity of care. Additionally, 28% said PA has led to a serious adverse event with at least one patient in their care, as defined by FDA adverse-event reporting, including death, hospitalization and serious injury.

“We were really shocked that over a quarter of organizations reported a serious adverse event,” McComas said.

Complicating the burden of PAs is health plan reliance on nondigital methods for processing them. Physicians reported phone and fax are the most commonly used methods for completing PA. Additionally, only 21% of physicians reported that their electronic health record systems offered electronic PA for prescriptions.

“There has been so much interest and activity in automation in the past couple of years, but it is not making its way to the people actually doing the work, yet,” McComas said.

Reasons for optimism about PA

Among developments that could advance improvements in the PA process is legislation sponsored by Rep. Suzan DelBene (D-Wash.) titled the Improving Seniors’ Timely Access to Care Act of 2019. The bill would require Medicare Advantage plans to undertake steps that include:

  • Establishing an electronic PA process
  • Ending the requirement to get PA on any surgical or other invasive procedure if the procedure is furnished during the perioperative period
  • Following an HHS process for “real-time decisions” for routine noncomplex items and services for which PA requests are routinely approved

Additionally, a growing number of state bills have aimed to lower PA requirements. For instance, more than 20 bills were considered in the last legislative session and several passed, including measures mandating electronic PA responses and bills requiring public reporting of PA transaction rates.

“It’s frustrating to bite it off state by state, but that is where health insurance is regulated now,” McComas said.


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