Action taken, more work needed on prior authorization

The issue of prior authorization is a legislative priority for ACP.

"In like a lion, out like a lamb" is the traditional folklore saying about March, which typically refers to the weather transition from winter to spring; however, from a political perspective, it seems like we may still have a lion to deal with at the end of the month. Outside of ACP's top priority of calling on Congress to address the 3.4% physician payment cut that all physicians are experiencing in 2024, another advocacy priority is addressing the issue of prior authorization.

In January 2024, CMS issued a final rule on interoperability and prior authorization in Medicare Advantage (MA) plans. I discussed the proposed version of this rule in my November/December 2023 column, based on our March 2023 letter to the agency expressing our overall support with a call for improvements. In December 2023, the College sent a follow-up letter to CMS noting the critical importance of finalizing the rule.

There are several key elements to be aware of in this final rule. First, it is important to note that it applies to MA plans, state Medicaid and Children's Health Insurance Program (CHIP) fee-for-service programs, Medicaid managed care plans, and qualified health plans that are on the federally facilitated exchanges, and not to Medicare Part B (i.e., Medicare fee-for-service) or other private health plans. Second, it applies to items and services that may require prior authorization from these payers, but drugs are not included in these items. Third, it implements requirements for the impacted payers to respond to prior authorization submissions within 72 hours for urgent requests and seven calendar days for non-urgent requests; however, there are exceptions to these timelines in certain circumstances. Fourth, it also requires that impacted payers provide a specific reason for any denied prior authorization requests—again, an improvement, but this should go further. These are extremely positive developments, but are not good enough!

The final rule also requires that affected payers use application programming interfaces (APIs) to make information about prior authorizations available to patients; other "providers" (although patients can opt out of having their data shared with their other clinicians); and among the impacted payers (however, patients need to opt in to allow payer-to-payer data sharing). It also requires the payers to provide patient education about all the different data-sharing options, lists of covered items and services, and what documentation requirements are necessary to seek approvals, as well as how long the approvals will last. Most of these requirements must be implemented by the impacted payers by Jan. 1, 2027—and again, they do not apply to medications, but rather to other items or services that may be subject to prior authorizations.

ACP has developed resources for our members to better understand these changes, and these will be updated as MA plans begin to put the requirements in place. As I noted earlier, while these are fantastic reforms, they do not go far enough. For one thing, this new rule does not include any medication prior authorizations. Additionally, the timing of 72 hours or seven days is still too long. Finally, while affected payers must provide a specific reason for denials, the response does not have to include actionable information as to how to resolve the issue, such as whether there may be missing information or a clinically preferred alternative.

This is why we continue to advocate for Congress to pass the Improving Seniors Timely Access to Care Act. This bill includes coverage of medications if they are part of the MA plan's benefit package (e.g., a PPO or special-needs MA plan), but would exclude those drugs covered under Part D in conjunction with the MA plan (e.g., an HMO plan). The legislation also requires MA plans to move to real-time authorization decisions for routinely approved items and services and, for plans unable to meet that requirement due to extenuating circumstances, they must issue final decisions for regular items or services within 72 hours or within 24 hours for urgent items or services.

The real challenge with this bill is that even though it has had bipartisan support since it was first introduced in 2022, it has been estimated to cost approximately $16 billion to implement. The hope is that the newly finalized rule from CMS will bring down this cost, but we do not yet have a new estimate from the Congressional Budget Office. Some speculate that it could bring the cost down to a negligible amount, and others think it may only bring it down to about $9 billion. This is certainly less than the original cost but is still substantial.

At the time of this writing, Congress is working on the spending bills for FY2024 after having passed yet another continuing resolution (CR) that funds the government through early March. These spending bills are likely one of the only legislative vehicles in 2024 that could be used to pass reforms such as the Improving Seniors Timely Access to Care Act, as well as to address issues like medication step therapy (via the Safe Step Act), the Medicare physician payment cuts, Medicare fee-for-service budget neutrality, and value-based payment reform. Given this, ACP has initiated a new Action Alert via our Advocates for Internal Medicine Networks (AIMn) on prior authorization and the Improving Seniors Timely Access to Care Act. It is critical that all our members take action and reach out to Congress to move it forward.

ACP has recently begun tracking state-level legislation on several key issues, including prior authorization. There are at least 57 bills across 22 states focused on prior authorization, some of which also address step therapy, on our radar. One of the biggest wins on this front, thanks to advocacy by ACP and a state chapter, occurred in New Jersey, where Assembly Bill No. 1255, "Ensuring Transparency in Prior Authorization Act," was enacted into law on Jan. 16. This law applies to New Jersey-based health plans and eliminates prior authorizations for all generic drugs, shortens the evaluation period for authorization decisions on items and services by payers from 15 to less than three days, and eliminates re-authorizations for medications during a therapy period. Payers are required to be compliant by Jan. 1, 2025. In addition to prior authorization, ACP is also tracking state-level legislation on reproductive health care, gender-affirming care, firearm violence injury prevention, and scope of practice, and we can generate state-level action alerts on these key issues or others that may come up within a state.

So, will March go out like a lamb as we head into spring? In my opinion, it is unlikely given that we are in an election year. I am optimistic that Congress will complete the necessary government funding bills and that some key riders like the Medicare payment cut and perhaps prior authorization in MA plans will be addressed, but only if our members and other physicians continue to let Congress know how important these issues are!

Outside of that, this year will be an opportunity to continue to educate Congress on our top priority issues, including administrative burdens; broader Medicare physician payment reform; access to telehealth and behavioral health care services; prescription drug affordability and drug shortage issues; physician and primary care workforce programs; protecting access to reproductive and gender-affirming health care; scope of practice; and health information technology, including interoperability and the role of augmented intelligence. Passing meaningful reforms takes time and we need our members to engage along the way so that we can see real change this month and beyond!