UnitedHealthcare signage is displayed on an office building in Phoenix, Arizona, on July 19, 2023.
Patrick T. Fallon | Afp | Getty Images
Health plans under major U.S. insurers said Monday they have voluntarily agreed to speed up and reduce prior authorizations – a process that is often a major pain point for patients and providers when getting and administering care.
Prior authorization makes providers obtain approval from a patient’s insurance company before they carry out specific services or treatments. Insurers say the process ensures patients receive medically necessary care and allows them to control costs. But patients and providers have slammed prior authorizations for, in some cases, leading to care delays or denials and physician burnout.
Dozens of plans under large insurers such as CVS Health, UnitedHealthcare, Cigna,Humana, Elevance Health and Blue Cross Blue Shield committed to a series of actions that aim to connect patients to care more quickly and reduce the administrative burden on providers, according to a release from AHIP, a trade group representing health plans. Though the companies cheered the changes, they could cut into profits if they lead to patients using care more often.
“The American health care system must work better for people, and we will improve it in distinctive ways that truly matter,” said Steve Nelson, president of CVS’ insurer, Aetna, in a statement. “We support the industry’s commitments to streamline, simplify and reduce prior authorization.”
Insurers will implement the changes across markets, including commercial coverage and certain Medicare and Medicaid plans. The group said the tweaks will benefit 257 million Americans.
Among the efforts is establishing a common standard for submitting electronic prior authorization requests by the start of 2027. By than, at least 80% of electronic prior authorization approvals with all necessary clinical documents will be answered in real time, the release said.
That aims to streamline the process and ease the workload of doctors and hospitals, many of whom still submit requests manually on paper rather than electronically.
Individual plans will reduce the types of claims subject to prior authorization requests by 2026.
“We look forward to collaborating with payers to ensure these efforts lead to meaningful and lasting improvements in patient care,” said Shawn Martin, CEO of the American Academy of Family Physicians, in the release.
During an event on Monday, Centers for Medicare & Medicaid Services Administrator Mehmet Oz thanked insurance companies for “stepping up.” He said the changes aim to address three issues: ensuring timely access to care for patients, achieving savings for the health-care system and increasing transparency into the prior authorization process.
at the event, Health and Human Services Secretary Robert F. Kennedy Jr. said the proposed tweaks to the process are different from the industry’s previous efforts because “the number of patients covered by this is unprecedented,” and there are clear deliverables and deadlines. He added that the administration expects more insurers to commit to making the changes.
The move comes months after the U.S. health insurance industry faced a torrent of public backlash following the murder of UnitedHealthcare’s top executive, Brian Thompson. It builds on the work several companies have already done to simplify their prior authorization processes.
UnitedHealthcare, in a statement, said it “welcomes the prospect to join other health insurance plans in our shared commitment to modernize and streamline the prior authorization process.”
The company said it expands on its previous efforts, including steps to reduce the number of services requiring prior authorization. It also includes UnitedHealthcare’s national Gold Card program which recognizes and awards providers who “consistently adhere to evidence-based care guidelines” by reducing their total prior authorization requests.
Prior authorization is a process used by health insurance companies that requires healthcare providers to obtain approval before performing certain medical services or prescribing specific medications. The goal is to ensure medical necessity and control costs. However, it often leads to delays in care and administrative burdens for both patients and providers.
Frequently Asked Questions
- What is prior authorization?
- Prior authorization is a requirement by insurance companies for healthcare providers to get approval before providing certain services or medications to patients.
- Why do insurance companies use prior authorization?
- Insurance companies use prior authorization to ensure that the requested medical services are medically necessary and to control healthcare costs.
- What are the problems with prior authorization?
- Prior authorization can cause delays in patient care, increase administrative burdens for providers, and lead to physician burnout.
- What changes are being made to prior authorization?
- Major insurers are working to streamline the prior authorization process by establishing common electronic standards, reducing the types of claims requiring authorization, and increasing real-time approvals.
- When will these changes take effect?
- The changes are being implemented, with key milestones including establishing electronic standards by 2027 and reducing claim types requiring authorization by 2026.
