CAQH CORE approves 2-day limit for health plans to act on prior authorizations

Doctor on phone/fax
Under a CAQH CORE rule both providers and patients will get speedier answers from health insurers when it comes to prior authorizations. (Getty/IPGGutenbergUKLtd)

Editor's note: This article was updated to include comments from April Todd, senior vice president of CAQH CORE.

A group that represents multiple industry stakeholders has voted to set a two-day time limit on how quickly health plans must act on prior authorizations.

CAQH CORE, a group that includes 110 organizations representing health plans, providers, vendors and government entities, voted to set a two-day limit on how quickly health plans must request additional supporting information from providers and make final decisions on prior authorization requests, the group said in an announcement.

Prior authorization from an insurance company for medical procedures is consistently a pain point for patients and providers. 

“Prior authorizations serve as a check on the safety and appropriateness of medical treatments, but when they take too long, they can delay patient care,” said Susan Turney, M.D., CEO of Marshfield Clinic Health System and CAQH CORE board chair. “With today’s announcement, the industry has reached a compromise to ensure they are done efficiently.”

The group said health plans participating in CAQH (the non-profit Council for Affordable Quality Healthcare) CORE (or Committee on Operating Rules for Information Exchange) represent 75% of the insured population in the United States. CAQH CORE is a collaboration set up to develop and adopt national operating rules for administrative transactions.

Prior authorizations are the costliest, most time-consuming administrative transaction for providers. When the prior authorization process takes too long, it can also delay patient care, which is why the group’s participating organizations have passed the national two-day time limit.

RELATED: Costs of prior authorizations increase for physician practices at an 'alarming' rate

It’s a big step toward improving the time-intensive process for prior authorizations, the group said. More than 80% of CAQH CORE's participating organizations agreed to the time limits on requests for supporting information and final determinations on prior authorizations .

“This is essentially the industry committing that they will follow this rule,” said April Todd, senior vice president of CAQH CORE, in an interview with FierceHealthcare.

“Our participating organizations really came together to come to a compromise on this. This has been an issue that has been top of mind for a lot of organizations for a long time,” she said.

CAQH CORE is designated by the Department of Health and Human Services (HHS) to author national operating rules and the group can now recommend the government adopt the two-day rule, which would be incorporated into HIPAA regulations. Right now compliance is voluntary, Todd said. If adopted by HHS, all entities covered by HIPAA would have to comply.

“We think we will get good consideration from HHS on this,” she said. “With 80% of our participating organizations approving this rule it shows the industry is committed to moving forward on this.” 

With the new operating rule, CAQH CORE participating organizations agreed to update requirements in the CAQH CORE 278 Prior Authorization Infrastructure Rule. The new requirements set national expectations for prior authorization turnaround times using the HIPAA-mandated standard to move the industry toward greater automation, the group said.

RELATED: MGMA19—No progress to fix prior authorization, as practice leaders say it's gotten worse

The updated operating rule establishes maximum timeframes at key stages in the prior authorization process for both batch and real-time transactions, including:

  • A two-day additional information request. A health plan, payer or its agent has two business days to review a prior authorization request from a provider and respond with the additional documentation needed to complete the request.
     
  • A two-day final determination. Once a health plan receives all requested information from a provider, it, its payer or agent has two business days to send a response containing a final determination.
     
  • Optional close out. A health plan may choose to close out a prior authorization request if it does not receive the additional information needed to make a final determination from the provider within 15 business days of communicating what additional information is needed.

Under the operating rule, health plans must meet the timeframe requirements 90% of the time in a calendar month.

“These industry-led efforts will benefit all stakeholders and patients in particular,” said Tim Kaja, COO of UnitedHealthcare Networks and CAQH CORE vice-chair. “In 2020, CAQH CORE participants will continue working to improve the prior authorization process with a focus on how operating rules can streamline the exchange of medical documentation and support the use of new technologies with existing standards.”

The updated rule, coupled with new rules released last May by CAQH CORE to strengthen the accuracy and consistency of the prior authorization process, enhance the information sent in the HIPAA-mandated standard electronic transaction and allow for faster responses, the group said.

The prior authorization process is a frustrating one for physicians and other providers. In a recent WEDI survey, 84% of providers reported the number of medical services that require prior authorization has increased.

A separate study by CAQH found the cost of prior authorization requirements on physician practices has continued to increase—up 60% in 2019 to manually generate a request to insurers.

And in Texas, 25% of patients say insurers have refused to cover a medication, procedure, test or scan that a doctor ordered for them or a family member, according to a statewide survey conducted by the Texas Medical Association.

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