CMS Issues Final Rule Reducing Prior Authorization Burden

January 21, 2021

On Jan. 15, the Centers for Medicare & Medicaid Services (CMS) and the Office of the National Coordinator for Health Information Technology (ONC) released a final rule containing new requirements for certain health plans to standardize prior authorization processes. 
Many of the new requirements align with Wisconsin Hospital Association (WHA) comments to CMS and ONC in 2019 to advance greater standardization of prior authorization processes to reduce documentation burden. 
Key items of the rule include:
  • Development and utilization of Fast Healthcare Interoperability Resources (FHIR)-based, electronic query-capable lists of services requiring prior authorization and documentation requirements.
  • Development and utilization of FHIR-based electronic prior authorization processes that will allow a provider to request and receive prior authorization decisions electronically.
  • Requires information about prior authorization requests be included in a data set payers must make available to patients, and that such information available to patients be directly accessible by their providers in a FHIR-based standard. 
  • Required timelines for standard (7 days) and expedited (72 hours) prior authorization requests.
  • If a prior authorization request is denied, required provision to the provider of a specific reason for the denial. 
  • Public reporting of prior authorization metrics, including lists of items and services requiring prior authorization, approval and denial rates by items and services, and average and median time for a prior authorization decision by items and services.  
In most instances, the above requirements will apply to:
  • Medicaid fee-for-service programs;
  • Medicaid managed care plans;
  • Children’s Health Insurance Program (CHIP) fee-for-service programs; and
  • Qualified health plans on the federally facilitate health plan exchange (Health Insurance Marketplace).
The effective date of the changes is Jan. 1, 2023, except for the FHIR-based electronic requirements, which are effective Jan. 1, 2024.
For more information, contact WHA General Counsel Matthew Stanford.

This story originally appeared in the January 21, 2021 edition of WHA Newsletter