Biden Admin Cracks Down On Prior Authorization

The Biden administration has passed a new rule that has angered insurance companies but should be a boon to medical providers and Americans throughout the country.

The new rule, released on Wednesday, looks to streamline the process that’s taken for prior authorizations that insurers use so they can approve certain medical treatments and procedures
This tool is commonly used by insurance companies, though patients and doctors typically don’t like it, as they claim insurers use it to deny care that doctors have recommended.

The new rule, issued by the Centers for Medicare and Medicaid Services, says that all health insurance companies that participate in the ObamaCare exchange, Medicaid or Medicare Advantage have to respond within 72 hours to expedited requests for prior authorization. All standard requests have to be responded to within seven calendar days.

All payers that are impacted by the new rule also have to provide a specific reason why they are denying such a request, too. They also must publicly report metrics for prior authorization.
In a statement, Xavier Becerra, the secretary of Health and Human Services, said:

“When a doctor says a patient needs a procedure, it is essential that it happens in a timely manner. Too many Americans are left in limbo, waiting for approval from their insurance company.
“Today, the Biden-Harris Administration is announcing strong action that will shorten these wait times by streamlining and better digitizing the approval process.”

The rule was initially proposed more than a year ago, but is just now going into effect. It’s a strong effort from the Biden administration to force insurance companies to change a practice in the health-care system that is considered very contentious.

Millions of Americans are expected to be impacted by the new rule.

The Biden administration for some reason has drugged its feet in passing this new rule. For months now, a bipartisan majority in both chambers of Congress has been pleading with the White House to finalize regulations to overhaul requirements under prior authorization in the Medicare Advantage program.

Insurance companies claim that prior authorization is necessary for them to help control costs as well as reduce the number of expensive and unnecessary treatments that doctors sometimes suggest.

On the flip side, patients and doctors say that insurance companies have taken advantage of prior authorization, putting in obstacles to getting sufficient patient care.

Many providers often have to navigate through paperwork requirements that vary a lot from insurer to insurer and are quite complex just to get procedures approved. In addition, they must wait a long time for decisions to be made about whether a procedure or treatment is going to be covered by insurance.

According to a study conducted by KFF, there were more than 35 requests for prior authorization issued by Medicare Advantage plans in 2021. Of that total, more than 2 million ended up being either partially or fully denied.

While patients who have traditional Medicare plans don’t need prior authorization for every procedure, those who are enrolled in Medicare Advantage require it for many services.