CMS Proposes New Rules to Address Prior Authorization 

Situation Report | December 14, 2020

Last week, the U.S. Centers for Medicare and Medicaid Services (CMS) issued a proposed rule to improve electronic exchange of health care data and streamline processes related to prior authorization.

The rule would require payers in Medicaid, the Children’s Health Insurance Program (CHIP), and Qualified Health Plan (QHP) programs to build application programming interfaces (APIs) to support data exchange and prior authorization that follow Fast Healthcare Interoperability Resource (FHIR) protocols.

Medicaid, CHIP and QHP payers would be required to build and implement FHIR-enabled APIs that could allow providers to know in advance what documentation would be needed for each different health insurance payer, streamline the documentation process, and enable providers to send prior authorization requests and receive responses electronically, directly from the provider’s electronic health record (EHR) or other practice management system. While Medicare Advantage plans are not included in these proposals, CMS is considering whether to do so in future rulemaking.

The proposed rule would also reduce the amount of time providers wait to receive prior authorization decisions from payers. The rule proposes a maximum of 72 hours for payers, with the exception of QHP issuers on the Federally-facilitated Exchanges (FFEs), to issue decisions on urgent requests and seven calendar days for non-urgent requests. Payers would also be required to provide a specific reason for any denial. The rule also requires plans to make public certain metrics that demonstrate how many procedures they are authorizing.

A Fact Sheet on the rule is here.

More information on the CMS proposed rule is here.