When your doctor decides you could benefit from a particular test or procedure, your insurance company might require documentation to prove it's necessary before agreeing to pay for anything. Sometimes, this "prior authorization" process requires faxing paperwork, getting denials and going through an appeals process.
Insurers ramped up the red tape in recent years, drawing the ire of patients, doctors and state policy makers who have championed various fixes to rein it in.
Now, a coalition of private health insurance companies has voluntarily pledged to standardize and reform this process.
By the end of this calendar year, federal health officials announced in a press conference Monday, the prior authorization process will be significantly better for health care providers and patients.
According to the Department of Health and Human Services and AHIP, the political advocacy and trade association for health insurers, there are six key parts of this pledge:
- Standardize electronic prior authorization submissions
- Reduce the number of medical services that require prior authorization
- Honor existing authorizations when patients change insurance plans in the middle of ongoing treatment
- Enhance transparency and communication about authorization decisions and appeals
- Minimize delays with real-time approvals for most requests
- Ensure medical professionals review all clinical denials
Health insurers have made similar commitments before, notes Miranda Yaver, health policy professor at the University of Pittsburgh and author of the forthcoming book Coverage Denied: How Health Insurers Drive Inequality in the United States.
"I think the question is whether this is actually going to come to fruition," she says. "We'll have to see to what extent they make good on their promise, because right now, it is a pledge."
Federal health officials told reporters that while this represents a voluntary commitment, they are prepared to issue new regulations if insurers don't abide by the agreement.
Health Secretary Robert F. Kennedy Jr. explained that this work came about because it represented a quick way to improve the dysfunctional health insurance system.
Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, suggested another reason for taking this on.
"There's violence in the streets over these issues," Oz said, alluding to the targeted killing of UnitedHealthcare CEO Brian Thompson last December. "This is not something that is a passively accepted reality anymore — Americans are upset about it."
Throughout Monday's press conference, Oz talked about the hazards of bureaucratic hurdles to patients' access to care.
"It's hard to square these priorities with an administration that is layering on new, and arguably unnecessary, administrative burdens in the Medicaid space," says Yaver.
The Trump administration and Republicans in Congress — as part of the major tax and budget bill — are poised to require certain Medicaid beneficiaries to periodically prove they are working in order to keep their insurance coverage.
"We know from research that Medicaid work requirements produce losses of insurance without producing corresponding increases in employment," Yaver says. If the prior authorization reforms are realized while Medicaid work requirements are instituted nationally, she says, "I don't think it would be unfair to say that we're replacing one set of burdens with another."
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