Medicare Advantage prior authorization bill nearing passage

Providers may soon find it easier to get prior authorization decisions from Medicare Advantage plans under legislation moving through Congress.

A key House committee advanced a bill last week that would streamline prior authorization requirements for Medicare Advantage carriers, which providers and patients say are long overdue for change. Groups lobbying in favor of the bill hope it will be attached to a larger legislative package before the end of the year. 

The bill would require Medicare Advantage insurers to establish electronic prior authorization programs that provide real-time decisions on certain items and services. Federal regulators would establish the definition of “real-time decision” through formal rulemaking.

Insurers would also need to meet transparency requirements by annually submitting lists of items and services subject to prior authorization, data on authorization denials and approvals, and disclosures of the decision-making software they use. Insurers also would provide some of this information to providers, suppliers and beneficiaries. 

Additionally, insurers would have to adopt beneficiary protection standards that allow for performance-based modifications to prior authorization rules for providers, continuity of care for people moving between coverage and more.

Lawmakers first introduced the Improving Seniors’ Timely Access to Care Act in 2019. The legislation is now closer to passage than ever following its approval by the House Ways and Means Committee last week. Rep. Suzan DelBene (D-Wash.) is the lead House sponsor and Sen. Roger Marshall (R-Kan.) introduced a companion bill in the upper chamber, where the Finance Committee has yet to consider it.

Provider groups have thrown their support behind the measure. Streamlining the process would “reduce the wide variation in prior authorizations methods that frustrate both patients and providers,” American Hospital Association Executive Vice President Stacey Hughes wrote the committee last month.

Intensified federal scrutiny of Medicare Advantage prior authorization practices has contributed to the momentum on Capitol Hill. Health and Human Services Department inspectors reported in April that some Medicare Advantage insurers have denied medically necessary care. Approximately 13% of prior authorization requests these plans denied would have been covered by fee-for-service Medicare, according to the HHS Office of Inspector General.

The bill has more than 300 House cosponsors and nearly 40 in the Senate. Advocates are seeking a legislative vehicle for the measure, said Peggy Tighe, a healthcare lobbyist who runs the Regulatory Relief Coalition, an umbrella group comprising physician organizations such as the American College of Surgeons, the American Academy of Family Medicine and the Medical Group Management Association.

“The writing’s on the wall that transparency is what must happen in healthcare,” Tighe said.

The insurance industry, which argues prior authorization is needed to promote efficiency and safety, hasn’t come out strongly against the bill. The Better Medicare Alliance, which lobbies for pro-Medicare Advantage policies, has even formally endorsed it.

“The Improving Seniors’ Timely Access to Care Act is a commonsense solution that builds on the work the Medicare Advantage community has been doing to streamline prior authorization for seniors,” Mary Beth Donahue, president of the Better Medicare Alliance, said in a news release issued in May.

AHIP, a trade association for insurers, supports electronic prior authorization. The organization released a report outlining ways insurance companies have improved prior authorizations since 2018 on the same day the Ways and Means Committee marked up the bill.

“That sets the stage for a bill that is bipartisan, bicameral, with huge support to advance. While many other bills are desperate to get onto a last-ditch legislative vehicle at the end of the year, this one is well positioned to do so,” Tighe said.

The Senate is currently focused on passing a domestic policy bill that would extend enhanced health insurance exchange subsidies and address prescription drug prices, and it’s unlikely the prior authorization reforms will be part of effort. The upcoming midterm congressional elections also occupy much of lawmakers’  attention. But Congress may turn to other priorities before the session ends, including during the “lame duck” period between Election Day and when the new Congress convenes in January, said Claire Ernst, the MGMA’s director of government affairs.

“I would hope that prior auth could move as soon as possible, but I also wouldn’t be surprised if it was a lame-duck-session type of situation,” Ernst said. “All eyes are pointing towards midterms right now.”

However, the Congressional Budget Office still hasn’t evaluated the Improving Seniors’ Timely Access to Care Act. Some lawmakers may be waiting to see a budget score before pushing the legislation forward. The 2021 Council for Affordable Quality Healthcare Index, which tracks provider and health plan uptake of electronic transactions, found the healthcare industry could save $437 million a year by switching to electronic prior authorizations. The report’s findings are not limited to Medicare Advantage.