Medical Coalition Calls for Prior Authorization Reform

Ken Terry

February 07, 2017

Addressing a longtime and growing burden on physicians, an American Medical Association (AMA)‒convened coalition of physicians, medical groups, hospitals, pharmacists, and patients is urging health plans, benefit managers, and other utilization review entities to reform prior authorization requirements related to medical tests, procedures, devices, and drugs.

The 17-member coalition, which, along with the AMA, includes a variety of other groups from the American Hospital Association to the American Pharmacists Association, says that requiring preapproval by insurers before they will cover certain drugs or treatments can delay or interrupt medical services, divert significant resources from patient care, and complicate medical decisions.

The coalition is calling for an industry-wide reassessment of prior authorization, following a set of 21 principles. These principles are grouped into five categories: clinical validity, continuity of care, transparency and fairness, timely access and administrative efficiency, and "alternatives and exemptions." The latter refer to restricting prior authorization to "outlier" physicians, allowing substitution of clinical decision support for prior authorization requests, and exempting doctors in organizations that take financial risk for care delivery.

Prior authorization requirements have existed for many years. Asked why the AMA chose to launch this prior authorization reform effort now, AMA President-elect David Barbe, MD, a family physician from Mountain Grove, Missouri, told Medscape Medical News that it was about improving the practice environment for physicians. Doctors view bureaucratic hassles like prior authorization as taking time away from patient care, which makes it more difficult to deliver quality care, he said.

A pair of recent AMA-commissioned studies defined the problem in concrete terms, spurring the coalition's formation, he noted. According to the results of one poll:

  • Each week, the average practice completes 37 prior authorization requirements per physician. These requests take the doctor and his or her staff an average of 16 hours to complete.

  • Seventy-five percent of surveyed physicians described prior authorization burdens as high or extremely high.

  • More than a third of respondents reported having staff who work exclusively on prior authorization.

  • Nearly 60% of surveyed physicians reported that their practices wait at least 1 business day, on average, for prior authorization decisions. More than 25% of respondents said they had to wait 3 business days or more.

The other survey, which included interviews with 38 physicians, found that doctors would like payers to streamline and add transparency to prior authorization or eliminate it altogether. Multiple participants said they spend from 15 minutes to 2 hours on the phone trying to obtain a single prior authorization. Some plans, they said, require doctors to try things they know won't work as part of the process known as "step therapy." For example, a patient might be told to undergo physical therapy for several weeks before that patient's plan will approve an MRI assessment.

Some of the coalition's principles for prior authorization reform are related to the clinical validity of prior authorization denials, the qualifications of reviewers, and plan policies that result in the unwarranted interruption of therapy. Among the latter are unexpected changes to drug formularies or coverage restrictions that can negatively affect a patient's access to care. Prior authorization approvals, the coalition stresses, should be valid for the course of treatment. They should also be made within 48 hours of obtaining necessary information ― and within 24 hours in urgent cases.

Transparency, Standardization

In addition, the coalition said, utilization review entities should be transparent about their requirements and the supporting documentation required. Moreover, they should standardize prior authorization processes by using standard transaction sets for electronic prior authorization (ePA). Web portals don't advance this process, the coalition noted, because healthcare providers must log onto each health plan's or utilization review entity's website and manually reenter the required data.

Several states already have requirements for ePA and/or the standardization of the prior authorization process, Dr Barbe pointed out. If health plans and pharmacy benefit managers don't respond to the coalition's effort, he suggested, the coalition could work with state legislatures or Congress.

The health insurers say they are willing to cooperate with the coalition. Responding to a query from Medscape Medical News, Kristine Grow, a spokeswoman for America's Health Insurance Plans, said, "We welcome the opportunity to sit down with the coalition and look for solutions that benefit consumers and ease the jobs of physicians."

Electronic Prior Authorization Status

Two ePA services, from Surescripts and Dr. First, have been available for more than 2 years. Currently, Surescripts' offering, called CompletEPA, is online with eight big pharmacy benefit managers that together represent 85% of the covered lives in the United States, said Luke Forster-Broten, product manager for CompletEPA, in an interview with Medscape Medical News. In addition, he noted, leading electronic health record (EHR) vendors Epic, GE, and NextGen have embedded CompletEPA, which uses the National Council for Prescription Drug Programs standard for drug prior authorization. However, only a small percentage of prescribers are using CompleEPA, he said.

Dr Barbe explained that the ePA solutions for medications are "not as user friendly as you might think." There are some technical issues, he said, and doctors would often rather have a nurse contact a pharmaceutical benefit manager than enter the information online themselves.

Forster-Broten countered that Surescripts has set up a process in CompletEPA for physicians to delegate ePA requests to staff members. He believes the main reason more doctors don't use this approach is that there is no federal mandate for them to do so.

Other types of prior authorization requests can theoretically go through clearinghouses to health plans via standard transactions that are part of the same transaction set used for insurance eligibility verification, claims submission, claims status, and electronic funds transfer. The main barrier is that insurance company systems are not all set up the same way.

To address that issue, the Committee on Operating Rules (CORE) of the Coalition for Affordable Quality Healthcare (CAQH), a multistakeholder organization, has formulated operating rules to standardize how health plans and utilization review entities receive and respond to ePA requests.

CAQH CORE finalized the operating rules for healthcare services review about a year ago, Gwendolyn Lohse, managing director of the organization, told Medscape Medical News. CORE has put up a test site that is now in beta phase, and about 20 entities are interested in receiving certification for compliance with the operating rules, she said. Healthcare services review, she added, is part of CORE's Phase IV operating rule set, which has been endorsed by health plans that cover 75% of commercially ensured people, along with many Medicare Advantage and Medicaid plans and some EHR vendors.

The 17 members of the prior authorization coalition include the AMA, the American Academy of Child and Adolescent Psychiatry, the American Academy of Dermatology, the American Academy of Family Physicians, the American College of Cardiology, the American College of Rheumatology, the American Hospital Association, the American Pharmacists Association, the American Society of Clinical Oncology, the Arthritis Foundation, the Colorado Medical Society, the Medical Group Management Association, the Medical Society of the State of New York, the Minnesota Medical Association, the North Carolina Medical Society, the Ohio State Medical Association, and the Washington State Medical Association.

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