CMS rule addresses prior authorization issues with Medicare Advantage plans

A new final rule from the Centers for Medicare and Medicaid Services (CMS) will make it harder for Medicare Advantage (MA) plans to require prior authorizations for their coverage.

The rule comes in the wake of a 2022 report from the Office of Inspector General of the US Department of Health and Human Services that found that some MA plans have been denying prior authorization requests even though the requests met Medicare coverage rules.

CMS says the new rule, announced April 5, is intended to address MA member complaints that plans’ prior authorization requirements restrict their access to care. In response, the rule will:

• limit the use of coordinated care MA plans’ prior authorization policies to confirming the presence of diagnoses or other medical criteria and/or ensuring that an item or service is medically necessary,
• prohibit coordinated care MA plans from requiring prior authorizations for an active course of treatment for at least 90 days when a patient switches MA plans,
• require all MA plans to establish utilization management committees to ensure consistency with Traditional Medicare’s national and local coverage decisions and guidelines, and
• require that prior authorization approvals remain valid “for as long as medically reasonable and necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient’s medical history, and the treating provider’s recommendation.”

“Together, these changes will help ensure enrollees have consistent access to medically- necessary care while also maintaining medical management tools that emphasize the important role MA plans play in coordinating medically-necessary care,” CMS said.

The rule comes in the wake of a 2022 report from the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services that found that some MA plans have been denying prior authorization requests even though the requests met Medicare coverage rules.

The OIG report also found that plans were denying payments to providers for some services that met both Medicare coverage and the MA plan’s own billing rules.

Physicians’ groups hailed the rule. “Family physicians know firsthand how this will help ensure timely access to care while alleviating physicians’ administrative burdens and patients’ care delays,” American Academy of Family Physicians President Tochi Iroku-Malize, MD, FAAFP, said in a tweet.

Ryan Mire, MD, MACP, president of the American College of Physicians, said the college is glad to see changes to the MA program, adding that the college had previously “called attention to the wasted time and resources that result from an unnecessarily burdensome prior authorization process.”

Jack Resneck Jr, MD, president of the American Medical Association, said that with the rule CMS “has taken important steps toward right-sizing the prior authorization process imposed by Medicare Advantage plans on medical services and procedures.”

This article first appeared on our sister site Medical Economics.