The new final rule, set to be enforced from January 1, 2026, aims to streamline and digitize the prior authorization process in healthcare. Key aspects of this rule include:
Timelines for Authorization Decisions: The rule mandates that decisions on urgent prior authorization requests must be made within 72 hours, and within 7 days for standard requests. This is expected to expedite the process and reduce delays in patient care.
Specific Reasons for Denials: Payers are required to provide specific reasons for denying authorization requests. Additionally, they must publicly report certain prior authorization metrics on their websites, enhancing transparency in the process.
Digitization and Automation: The rule emphasizes the need for payers to digitize and automate the prior authorization process. This includes maintaining a Health Level 7 Fast Healthcare Interoperability Resources (FHIR) prior authorization application programming interface (API), which facilitates a more efficient electronic process between providers and payers.
Impact on MIPS Eligible Clinicians: The rule includes provisions for electronic prior authorization measures for merit-based incentive payment system (MIPS)-eligible providers under the performance improvement category. However, this aspect has raised concerns about additional burdens on physicians.
Overall Benefits: CMS estimates that the rule will result in approximately $15 billion in savings over 10 years. It has been praised by healthcare organizations like the American College of Rheumatology and the American Medical Association for its focus on efficiency, transparency, and reducing administrative burdens.
Scope of Application: The final rule applies to various healthcare entities, including Medicare Advantage organizations, Medicaid and the Children’s Health Insurance Program (CHIP) fee-for-service programs, Medicaid managed care plans, CHIP managed care entities, and issuers of qualified health plans on federally facilitated exchanges.
The rule is seen as a significant step towards improving healthcare outcomes and experiences by streamlining prior authorization processes and enabling more efficient data flow among patients, providers, and payers.