Skip to main content

Medical Groups Highlight Prior Authorization Reform for Improving Medicare Advantage

Analysis  |  By Jay Asser  
   September 07, 2022

The Medical Group Management Association (MGMA) and the American Hospital Association (AHA) have offered their recommendations on streamlining the administrative process.

Reforming prior authorization to cut down on treatment delays and administrative burden is a necessity for improving Medicare Advantage (MA), according to key medical groups.

MGMA and AHA have submitted their comments to CMS in response to a request for information on the MA program, with both groups offering recommendations on prior authorization policies.

MGMA encourages CMS to take the following steps:

  • Publish the Interoperability and Prior Authorization for MA Organizations, Medicaid and CHIP Managed Care and State Agencies, FFE QHP Issuers, MIPS Eligible Clinicians, Eligible Hospitals and CAHs proposed rule: This rule would improve the electronic exchange of data and streamline prior authorization processes, but MGMA believes the timeframe for when health plans should respond to medical groups for urgent prior authorizations and for standard prior authorizations should be shorter than the timeframe CMS proposed of 72 hours and seven days, respectively.
  • Implement recommendations included in the OIG report: The research revealed the MA organizations often unnecessarily delayed or denied members' access to services, even when prior authorization requests met coverage rules. Among its recommendations, OIG urged CMS to update audit protocols to prevent errors.
  • Reinstate step therapy prohibitions in MA plans for Part B drugs: MGMA notes that step therapy requires patients to try and fail certain treatments before allowing access to usually more expensive treatments, which allows health plans to undercut the provider-patient decision-making process.
  • Increase CMS oversight over MA plans' use of prior authorization processes.
  • Require transparency of payer prior authorization policies and establish evidence-based clinical guidelines available at the point of care.

Meanwhile, AHA said in its recommendations that it wants CMS to:

  • Requires MAOs to follow traditional Medicare coverage rules to prevent unnecessary delays and burdens associated with inappropriate use of prior authorization.
  • Establish a standard electronic transaction for providers to submit and receive responses for prior authorizations.
  • Require greater transparency regarding prior authorization.
  • Improve the quality and use of MAO data related to prior authorizations, including changes in the frequency of reporting, increased transparency, penalties for non-compliance, more targeted auditing, and suggestions for how these data could be incorporated into Star Ratings.
  • Reduce administrative waste in the MA program, including requiring plans to comply with standard, electronic process for prior authorization.

While prior authorization requirements can negatively affect patient outcomes, as shown in the OIG report, the administrative process can also hinder providers.

A recent survey by MGMA revealed that 79% of medical groups feel that payer prior authorization requirements increased in the past year. The increase is only putting more stress on providers, with 88% of physicians reporting that the administrative burden associated with prior authorization is high or extremely high, according to a survey conducted by the American Medical Association.

Jay Asser is the contributing editor for strategy at HealthLeaders. 

Get the latest on healthcare leadership in your inbox.