House bill mandates Medicare Advantage plans adopt electronic prior authorization

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A reintroduced House bill aims to streamline prior authorization, a key source of administrative burden for providers. (Pixabay)

New legislation in Congress would require Medicare Advantage plans to create an electronic prior authorization process, targeting a major source of administrative burden for providers.

The House legislation, introduced Thursday, would also create a process for payers to quickly clear items and services that are routinely approved and improve transparency on the extent of prior authorization used by MA payers.

“The majority of the healthcare community agrees that prior authorization needs to be reformed,” said Rep. Suzan Delbene, D-Washington, one of the co-sponsors of the legislation, which is called the Improving Seniors’ Timely Access to Care Act.

In addition to requiring electronic prior authorization for MA plans, the bill would:

  • Require the Department of Health and Human Services to create a process for “real-time decisions” on items and services that commonly get approved;
  • Require MA plans to report to the Centers for Medicare & Medicaid Services on their use of prior authorization and their rate for approvals and denials; and
  • Entice plans to adopt evidence-based medical guidelines when consulting with physicians over prior authorization requests.

The legislation was introduced last Congress and has strong bipartisan support. However, it was put on the back burner as Congress faced trying to get the pandemic under control, according to a source familiar with the legislation.

A companion bill in the Senate is also expected.

RELATED: Epic, Humana ramp up partnership to focus on streamlining prior authorization

The legislation addresses an area that providers have been clamoring for relief on. The American Medical Association called for passage of the original legislation in June 2020 and highlighted physician survey data that showed 91% saying prior authorization impacted patient care.

The Trump administration finalized a rule Jan. 15 that required electronic prior authorization for federal Affordable Care Act exchange plans, Medicaid and Children’s Health Insurance Program payers.

However, the Biden administration appeared to remove the rule back in February. The new administration had put a regulatory freeze on plans approved near the end of the Trump administration to determine whether they were hastily approved and needed review.

Providers had called for the rule to also apply to MA plans.

It remains unclear whether the legislation will get severe pushback from the payer industry. America’s Health Insurance Plans (AHIP), the top insurance lobbying group, did not return a request for comment on the legislation.

AHIP and other payer groups have previously endorsed electronic prior authorization as a way to cut down on administrative burden. However, AHIP did comment on the Trump administration rule that the regulation doesn’t take into account the full costs insurers could face when implementing application programming interfaces to exchange patient data and streamline prior authorization.