Effort to Reform Prior Authorization Gains Traction in Texas

A new law in the Lone Star State grants automatic approval of medical orders for clinicians who have a track record of prior authorization approvals at a payer.

The effort to reform prior authorization of clinician orders has taken a step forward in Texas.

Reining in prior authorization of clinician orders by payers is a top priority of physician groups. They argue prior authorization delays or denies evidence-based care and places an onerous administrative burden on healthcare providers.

"Our effort at the AMA and the state medical societies is about right-sizing prior authorization. We do not expect it to go away entirely, but it has gotten out of control," says Jack Resneck, Jr., MD, president-elect of the American Medical Association and a practicing dermatologist in the San Francisco Bay Area.

In June, Texas adopted a new law that features "gold carding" clinicians to make the application of prior authorization more selective. Under the new law, if a clinician orders a medical service such as medication at least five times in a six-month period and at least 90% of the orders pass prior authorization muster, then the clinician is exempt from undergoing prior authorization for the particular medical service for the next six months.

"House Bill 3459 sought to diminish some of the burdens of the prior authorization process on Texas patients and physicians. It sought to do that by creating a path to gold carding or automatic approval when there is a study or service that is ordered by a doctor and the doctor has a track record of getting most of those studies or services approved when using a particular insurer," says Debra Patt, MD, a practicing oncologist at Texas Oncology in Austin, Texas, and immediate past-chair of the Texas Medical Association Council on Legislation.

She gave a theoretical example from her practice. "If I order a CT scan for the chest and abdomen, and I have ordered that exam five times in a six-month period and my history is that they get approved, then for the next six months all of my CT scans for the chest and abdomen through that same insurer will be approved. So, my CT scans will be gold carded."

Gold carding benefits patients and clinicians, Patt says. "The natural consequence of gold carding is that my staff will not spend five hours working on a prior authorization and patients will not have delays in care of two to three weeks to get authorization for appropriate care."

Gold carding only applies to payers that fall under the state's jurisdiction and are not state funded. The law is set to go into effect on Sept. 1.

The Texas law is only a first step in the journey to prior authorization reform, she says. "The truth is that utilization management has gotten more arduous—it has become very difficult for patients to receive guideline-based care. If the purpose of utilization management is to provide high-value care, insurance companies need to step up to the plate and work more collaboratively with physician groups to make sure that we have alignment in getting patients appropriate high-value care without the inappropriate delays and administrative burdens."

National drive for prior authorization reform

In January 2018, the AMA and other national organizations representing pharmacists, medical groups, hospitals, and health plans signed a consensus statement outlining a shared commitment to improving five key areas associated with prior authorization. That effort has not generated action, so prior authorization reformists have shifted their focus to legislative and regulatory changes at the state and national level, Resneck says.

"It is unfortunate that since that consensus statement we have not seen any significant progress at the major national health plans. That is why we have reached the point now where patients and physicians alike are looking to legislative and regulatory solutions to try to right-size prior authorization," he says.

The new efforts largely mirror the five reforms sought in the consensus statement, Resneck says.

• Selective application of prior authorization: "If you are a doctor who is following evidence-based guidelines, and you are being asked to jump through hoops and fill out prior authorization paperwork, but 99% of the care you are providing with prior authorization is being approved, the health plan should not be placing an added burden on you or themselves to put you through the same process as somebody else who may be creating more challenges."
   
• Prior authorization program review and volume adjustment: "We want to decrease the volume of prior authorizations. For example, medications that end up getting approved 99% of the time probably should not be on prior authorization lists. Generics should not be on prior authorization lists. Things where there is not alternative to treating a certain disease should not be on a prior authorization list."
   
• Transparency and communication: "Some of the state legislation is just asking for the basics of public release of general statistics for prior authorization. For medications, how often are they approved, how often are they denied, how often are appeals filed, and how often are those appeals granted?"
   
• Continuity of patient care: "We see a lot of patients who have a chronic disease, and you find the treatment that works well—they are stable, and their chronic disease is being held in check. Then, all of a sudden, the patient changes health plans or their health plan changes the formulary and the medication that did not require prior authorization now does require prior authorization. So, you have a patient who cannot get renewal of their medication without the prior authorization process."
   
• Automation: "Patients are shocked to find out that when clinicians are sitting down at our electronic health record writing their prescription, we often cannot see what is on formulary and not on formulary, we cannot see what requires prior authorization, and we cannot see how much different medications cost. Physicians feel that we should have transparency about that data."

"The reform effort is requiring a piecemeal approach. The reality is, we are seeing interest at the Department of Health and Human Services, the Centers for Medicare & Medicaid Services, Congress, and state legislatures because everybody is a patient at one time or another and prior authorization has gotten to be so ubiquitous and a burden that patients are getting frustrated. Legislatures are hearing about it," Resneck says.

Related: Docs Say Pandemic Provided Scant Relief From Prior Authorization Mandates