The back and forth between providers and payers over prior authorization data exchanger is approaching its peak. Here are two programs that, if broadly adopted, could help the two sides work together to improve the process.
The tug of war over the denials and appeals process for prior authorizations is having a direct impact on patients, with a recent survey showing some are skipping treatment due to delays.
And that’s taking a toll on providers.
“We’re in a crisis,” Shanda Richards, revenue cycle director of Alaska’s Central Peninsula Hospital, previously told HealthLeaders. “We’re delaying care because we can’t get prior authorization, so therefore we have to get something in place.”
But what can compel providers and payers to work together to solve this bottleneck?
New Rules
In January, the Centers for Medicare & Medicaid Services (CMS) finalized the Interoperability and Prior Authorization Final Rule, which streamlines the process while allowing insurers to maintain some control over costs with increased transparency provisions.
The rule automates information exchanged between providers and payers to an extent, though the electronic communication aspect doesn’t apply to part B and part D medications.
Organizations like the Medical Group Management Association (MGMA) applauded the rule, which includes increased transparency provisions. According to Anders Gilberg, the association’s senior vice president, requiring health plans to provide clarity on their reasoning for denials and publicly report the aggregated metrics of their prior authorization programs will bring payors’ “egregious abuse of prior authorizations” to light.
The call for prior authorization reform is also being heard—and answered—at the state level, with 30 states introducing almost 90 reform bills collectively in 2023. These bills contained requirements similar to those in CMS’ final rule, including establishing quick response times and making prior authorizations valid for a set length of time or duration of treatment.
Home (Data)base
The healthcare industry has used digital health tools over the past several years to improve the revenue cycle process, but those advances won’t truly be effective unless the industry agrees to data exchange standards.
Despite the availability of the HL7 Fast Healthcare Interoperability Resources (FHIR) standard, which defines how healthcare data can be exchanged between different computer systems, many hospitals and health systems are hesitant to adopt the tool, either because they don’t have the resources or they don’t think it will be broadly adopted.
FHIR also doesn’t require payers to work directly with a health system’s or hospital’s EHR, which is the source of the bulk of the administrative burden.
The Office of the National Coordinator for Health IT (ONC) has encouraged FHIR use; most recently with the release of version 2.0 of the Trusted Exchange Framework and Common Agreement (TEFCA).
Version 2.0 enhances the framework, provides better support for cases beyond treatment, and simplifies onboarding processes for clinicians, digital health apps, public health agencies, and other users of health data.
“We have long intended for TEFCA to have the capacity to enable FHIR API exchange,” ONC chief Mickey Tripathi, PhD, added in a press release. “This is in direct response to the health IT industry’s move toward standardized APIs with modern privacy and security safeguards, and allows TEFCA to keep pace with the advanced, secure data services approaches used by the tech industry.”
Jasmyne Ray is the revenue cycle editor at HealthLeaders.
KEY TAKEAWAYS
Interoperability and Prior Authorization Final Rule finalized in January was intended to alliviate some strain, but its too soon to tell how effective it's been.
States have also joined the prior authorization reform efforts, with 30 introducing their own bills in 2023.
Interoperability is still the goal, but the sector has been slow to agree on data exchange standards.