AMA adopts new prior authorization reform policies

 AMA adopts new prior authorization reform policies

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Physician and medical student leaders at the Annual Meeting of the American Medical Association House of Delegates have approved policies aimed at fighting for greater insurer accountability and transparency regarding prior authorization requirements – issues which the AMA said are denying necessary care for patients and adding administrative burdens for physicians.

The policies adopted by the House of Delegates address what it sees as the need for greater oversight of health insurers’ use of prior authorization controls on patient access to care.


According to the AMA, health plans continue to inappropriately impose bureaucratic prior authorization policies that conflict with evidence-based clinical practices. These policies, in the group’s view, jeopardize quality care, prompting the agency to advocate for increased legal accountability of health insurers when it’s deemed that prior authorization is harming patients.

Surveys of physicians have generally found that excessive authorization controls required by health insurers lead to harm when necessary medical care is delayed, denied or disrupted. Investigations by the inspector general’s office of the Health and Human Services Department and Kaiser Family Foundation into prior authorization by Medicare Advantage plans suggest that insurers are denying medically necessary healthcare.

The AMA said it would also work to ensure that increased legal accountability of insurers is not precluded by clauses in beneficiary contracts that may require pre-dispute arbitration for prior authorization determinations or place limitations on class action.

Citing health insurers’ prior authorization programs that include extensive denial processes, the AMA said it would work to ensure insurers provide prior authorization notifications with detailed explanations regarding the rationale for denying access to care.

New AMA policy outlines basic information requirements for prior authorization denial letters that include a detailed explanation of denial reasoning, access to policies or rules cited as part of the denial, information needed to approve the treatment, and a list of covered alternative treatments.

The organization said it would also continue its work to support real-time prescription benefit tools (RTBTs) that allow physicians access to patient drug coverage information at the point of care in their electronic health records. RTBTs, according to the AMA, can streamline access to care and avoid unexpected delays and denials by confirming insurer-approved care or providing therapeutically-equivalent alternative treatments that do not require the insurer’s prior authorization.


A final rule issued by the Centers for Medicare and Medicaid Services in January deemed that impacted payers will be required to send prior authorization decisions within 72 hours for urgent requests and seven calendar days for standard requests.

It affects Medicare Advantage organizations, state Medicaid and Children’s Health Insurance Program, fee-for-service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan issuers on the Federally Facilitated Exchanges.

All are required to implement and maintain certain Health Level 7 Fast Healthcare Interoperability Resources application programming interfaces to improve the electronic exchange of healthcare data, as well as to streamline prior authorization processes. 

Impacted payers must also implement certain operational provisions beginning January 1, 2026.

In July of last year, the AMA, American Hospital Association and Blue Cross Blue Shield Association sent a joint letter to CMS requesting that the government agency reconsider regulatory proposals requiring different electronic standards for data exchange during the prior authorization process.

The groups said that, while they appreciate the administration’s efforts to reduce administrative burdens and costs within the healthcare system, including prior authorization reform, they described the regulatory proposals as “conflicting.” They say they potentially set the stage for multiple prior authorization electronic standards and workflows – which would contribute to the “costly burdens that administrative simplification seeks to alleviate.”

Jeff Lagasse is editor of Healthcare Finance News.
Healthcare Finance News is a HIMSS Media publication.

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