Your estimated arrival time is now going up, and you’re going nowhere! An element of this frustration is because you see no end in sight, and it’s just wasted time (and fuel) as you wait. Not to mention that relative who is also now circling the airport arrivals section, and promising to themselves never do this pickup favor for you again.

Well, this is the core of many healthcare providers’ frustration with the prior authorization system. It seems as if we are just circling and circling to accommodate insurer requests, but getting nowhere by doing so. Let’s back up a bit and give you the 30,000-foot view for a general big picture of the prior authorization process.

Prior authorizations were introduced in the 1960s. Originally, they were designed as a measure to ensure appropriate utilization of healthcare services, specifically to avoid unnecessary hospitalizations. However, with time these requirements have evolved into a complex process with far-reaching implications. While insurers maintain the primary purpose of PA is to safeguard patients from unnecessary and costly interventions, concerns have arisen regarding the potential misuse of PA as a cost containment tool. 

Quite often, providers see authorization issues leading to delays in patient care and unjust denial of medically necessary treatments.

Cue the appearance of third-party solutions: to address the challenges posed by PA requirements, various third-party solutions have emerged. One of them involves the implementation of software that enables insurers to create prediction models based on historical data and member acuities. 

These predictive models aim to identify cases where PA may be warranted, thereby streamlining the process for legitimate cases while reducing administrative burden by weeding out those deemed unwarranted.

Conversely, some provider-focused software has been developed to counteract this insurer pushback. Utilizing automation and, yes, even artificial intelligence. With this, providers can identify and address common reasons for PA denials, push for consideration when appropriate, bolstering the basis for appeals, and ultimately ensuring a more transparent and efficient PA process.

This is where the circling and dizziness feelings ensue. As each side continues to create solutions to counteract the other’s last attempt to circumvent it, we are just whirring in a circle of reactive solutions instead of really thinking of answers that will be amicable for both parties. A solution is needed that fosters collaboration between healthcare providers AND payers. After all, both parties share the common goal of delivering quality healthcare, but the misalignment in their objectives at this point is hindering the process.

Let’s be clear. Healthcare providers understand the necessity of PA screening, acknowledging its role in promoting evidence-based care and cost-effectiveness. On the flip side, insurers are also aware of the growing concern that some patients are being denied essential treatments recommended by reputable providers, due to rigid PA criteria.

So back to our airport analogy. I’d like to propose a “TSA PreCheck” style solution to this conflict. As we all know, TSA has extensive security measures in place. Line up, IDs out, shoes off and then pat downs if you look like you’re smuggling more than 3.4 ounces of liquid (gasp!). 

But then there are those who qualify as trusted travelers with TSA PreCheck.

Less scrutiny, shoes stay on, even laptops can stay put. The concept is that once they have been vetted and proven to be trusted, they are given more leeway. Of course, at any time they can be pulled over for a spot check; even lose this privilege if there is any reason for concern.

Imagine we introduced a similar collaborative technique for prior authorizations. Here is how it would fly:

Insurers introduce a tiered methodology to provider credentialing based on providers’ historical adherence to evidence-based practices, patient outcomes, and avoiding rehospitalizations. Providers with a proven track record of delivering high-quality care could be granted Tier 2 status. This allows for expedited PA approvals, and recognized standard procedures that do not require PA, thereby reducing administrative burdens.

By establishing this, a provider is motivated to maintain this status and, therefore, ensures their adherence to insurer rules and directives. Insurer relaxes the heavy scrutiny, but reserves the right to periodically check on provider observance of obligations and red flag or demote to Tier 1 as necessary. 

This can really be a win-win situation that can lead to more collaboration with the insurer, and the provider finally being on the same page once and for all.

Now nobody said this will be easy to implement. It will likely need to begin with conversation between leadership on both ends of what the criteria would be, and what effect this tier-based approach will have on the current PA process. So, at this point, please look at this as an idea. 

An idea with only the best interests of everyone in mind, to solve an industry problem that has been going on for too long. After all that’s how all good ideas “takeoff” — it all starts with an idea. Let’s just hope this one lands!

Steve Shain is Partner, EVP of Contracting at LTC Ally. His team negotiates managed care contracts and authorizations on behalf of healthcare providers. Contact him directly at steves@ltcally.com.

The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.

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Prominent progressives such as Rep. Rosa DeLauro (D-CT) and Sen. Elizabeth Warren (D-MA), who blasted Medicare Advantage as being a “scam” by private insurers, headlined a press conference Tuesday in Washington. Numerous speakers derided the program and used the social media hashtag #reclaimMedicare to advocate bringing patients back under the banner of traditional Medicare. 

Just over half of individuals eligible for Medicare are enrolled in Medicare Advantage plans, according to information released by the Centers for Medicare & Medicaid Services in May. In January, 30.2 million of the 59.8 million people who have Medicare Parts A and B were enrolled in private plans. That’s a massive increase from 2007, when just 19% of those eligible opted for Medicare Advantage. 

“It is time to call out so-called Medicare Advantage for what it is,” DeLauro said. “It’s private insurance that profits by denying coverage and using the name of Medicare to trick our seniors.”

The program certainly needs improvement, a pair of  experts told McKnight’s Long-Term Care News Wednesday.

Tyler Overstreet Cromer, head of ATI Advisory’s Medicare Innovation Practice, said CMS has strengthened marketing requirements “to tamp down on confusing or even deceiving ads about MA.” 

“Successful implementation of these policies will be key steps to addressing these concerns,” Overstreet Cromer said. “Additionally, more can be done to provide clear information about what supplemental benefits are and are not so consumers can make more informed decisions. More data and transparency can be powerful tools to help consumers understand their benefit choices and tradeoffs between offerings like supplemental benefits and use of tools like prior authorization across their Medicare options.”

Prior authorization was a target of the letter from the nearly 300 Members of Congress. They wrote that it “remains an enormous burden on doctors’ practices and a threat to patient care. … Insurers continue to delay and even deny covering necessary care and overstep medical decision-making while increasing their profits.”

Legislation has been introduced in both the House and Senate to modernize the prior authorization process. Another bill from three House Democrats, called the “Save Medicare Act,” would prohibit private insurance companies from using the word “Medicare” in their plans.

Susie Mix, CEO of Mix Solutions, told McKnight’s that the most important thing lawmakers will learn after digging into MA is that seniors are not receiving the same or even better benefits than traditional Medicare plans would provide. 

“[The] diversion of patients going home versus a SNF, and prior authorization debacles are just the beginning,” she said. “Looking further into the process, they will see that in many cases, these patient stays are being dictated by an algorithm made up by a group that has gathered data and fed it to a program.”

The 61 senators and 233 Representatives signed a letter to the Centers for Medicare & Medicaid Services urging the agency to continue its recent efforts to “lessen administrative burden for providers.”

Chief among the proposals highlighted in the Wednesday request was a call for a real-time mechanism supporting quick electronic prior authorization (PA) decisions for routinely approved services.

“This mechanism would improve patient care and reduce provider burden while avoiding unnecessary delays,” reads the letter, which was spearheaded by Sens. John Thune (R-SD) and Sherrod Brown (D-OH). “Hundreds of organizations representing patients, physicians, hospitals and other healthcare experts have put their support behind an e-PA proposal that includes a real-time process for items and services that are routinely approved.”

In a 2024 Medicare and Medicare Advantage rule finalized in April, CMS began to initiate some changes to prior authorization requirements that have been broadly criticized by skilled nursing providers as blocking access to nursing home care that would be covered by traditional Medicare benefits. One long-time SNF payment expert told McKnight’s Long-Term Care News that nursing home stays and MRIs are the top two services denied by MA’s prior-authorization process.

The 2024 rule limits MA insurers to using prior authorizations only in cases when a diagnosis is unclear, which was expected to lead to easier transfers of hospital patients to nursing homes.

The lawmakers are asking CMS to adopt policies that further that effort and ensure immediate access to all kinds of care by:

• creating a deadline of 24 hours for MA plans to respond to prior authorization requests for urgently needed care, and 
• requiring detailed transparency metrics

Tackling dangerous practices

Thune, in a press release, noted that transparency efforts reflect elements of the Improving Seniors’ Timely Access to Care Act, which was backed by some 500 provider groups when it passed the House last year. Those included LeadingAge, the National Association for the Support of Long-Term Care (now ADVION), the American Geriatrics Society and other groups working with seniors.

The legislation has been reintroduced in both chambers of Congress this session. MA tactics have continued to draw the attention of Congress this year, with “impossible” denials and the use of artificial intelligence in decision-making about SNF stays decried at a May Senate hearing.

“Prior authorization remains an enormous burden on doctors’ practices and a threat to patient care, as insurers often provide no evidence of overutilization for targeted procedures and treatments,” the lawmakers wrote Wednesday. “Insurers continue to delay and even deny covering necessary care and overstep medical decision-making while increasing their profits.”

The fiscal 2024 rules went  into effect June 5.

The lawmakers also said that faster approvals would offer an incentive to providers, too.

“Based on industry growth (due to market demand), robust evidence continues to demonstrate that implementing real-time decisions produces cost savings for healthcare providers and health plans,” they noted.

Their letter also underscored that today’s prior-authorization process, which can take up to 72 hours under current regulation, could create life-or-death situations.

“We are concerned that delaying care for up to three days could jeopardize a patient’s life, health, or ability to regain maximum function,” the letter stated.

A Senate subcommittee Wednesday sent letters to the nation’s largest Medicare Advantage insurers, demanding they reveal internal documents that illustrate how they make coverage determinations.

Word of that request came during a hearing examining healthcare denials and delays in the Medicare Advantage program held by the Senate Committee on Homeland Security and Governmental Affairs’ Permanent Subcommittee on Investigations.

The harmful effects of such processes on residents seeking skilled nursing care was specifically highlighted by subcommittee members and witnesses.

“There is growing evidence that insurance companies are relying on algorithms rather than doctors or other clinicians to make decisions to deny patient care,” said Chairman Richard Blumenthal (D-CT), during the subcommittee’s first session of the new Congress. “Our subcommittee has been hearing from patients and providers alike who have stories of care being delayed or denied. And many of these stories involve patients who have been hospitalized for serious medical issues and need nursing home or rehabilitative care before they are ready to return home.”

“The insurers may refer to these algorithms as tools used for guidance, but the denials they generate are too systematic to ignore. All too often, black box AI [and algorithms] have become a blanket mechanism for denial.”

Blumenthal noted that insurers call those algorithms proprietary, but the subcommittee would like to see them become more transparent.

During opening remarks, Blumenthal also pointed out a strong motive for MA plans to keep requiring prior authorizations or terminating coverage of certain care before physicians say patients are ready: Their profit margins. Blumenthal shared a graphic showing that MA plans have an average margin of $1,730 per enrollee, compared to $745 for those insured on the individual market or $689 for those insured through the group plan market.

“Insurers are, in effect, denying Ameircans necessary care in order to fatten and pad their bottom lines, and that phenomenon is unacceptable,” he said. “I want to put these companies on notice. If you deny life-saving coverage to seniors, we are watching, we will expose you, we will demand better, we will pass legislation if necessary.”

He added that letters seeking more information on company practices were sent to CVS-Aetna, United Heath and Humana, which in combination cover more than 50% of Medicare Advantage beneficiaries.

A potential incentive

“Medicare Advantage plans’ internal criteria are supposed to be no more restrictive than original Medicare. However, the capitated payment system in Medicare Advantage creates a potential incentive for insurers to deny access to services for enrollees,” testified Megan Tinker, chief of staff for the Department of Health and Human Services’ Office of Inspector General.

In addition to noting new CMS rules regarding plans’ use of authorizations and clinical criteria, Tinker noted that OIG Inspector General Christi A. Grimm met with several plan executives last month and told them to “step up their efforts” around practices that impede access to care.

A major OIG report issued in April 2022 found that Medicare Advantage plans routinely denied skilled nursing stays, a finding underscored by KFF analyst Jeannie Fuglestein Biniek, PhD. That has meant fewer stays and reduced length of stay for skilled nursing providers, who argue they are more equipped than ever to handle complex patients.

“Virtually all Medicare enrollees are in a plan that requires prior authorization for at least some services, usually high-cost services like chemotherapy or skilled nursing facility stays — services that people use at some of the most medically fragile points of their lives,” said Fuglestein Biniek, associate director of KFF’s program on Medicare policy.

While she endorsed CMS efforts to rein in the use of such tools in limiting care delivery, she also noted that it will be hard to assess how well such measures work because there is a dearth of data on Medicare Advantage denials.

In recent weeks, as Medicare Advantage enrollment officially surpassed more than 50% of all Medicare beneficiaries, calls to improve the plans’ transparency have increased.

Denials lead to red tape ‘maze’

Christine Jensen Huberty, a supervising attorney with the Greater Wisconsin Agency on Aging Resources, testified about her agency’s efforts to help residents work through denials of skilled nursing care.

“If a senior has traditional or original Medicare, they can expect to receive up to 100 days of coverage for their stay with no hassle,” she said. “If a senior has a Medicare Advantage plan, however, they can expect to receive a denial well before their doctor’s even say they’re ready to go home.”

Those denials start a “maze of red tape that is dizzying even to our experienced legal team,” Huberty added, noting that most are now issued by a third-party contractor using an algorithm to deny or shorten a stay.

“Patients caught in this maze are forced to make a devastating decision: Stay in the rehab facility and pay thousands of dollars out of pocket or go home against medical advice,” she added, noting that denials that are ultimately overturned may take a year to be reimbursed. “They’re not getting the coverage that they paid for, and they’re met with hurdles at every turn. … Our most vulnerable citizens are up against an impossible system.”

Researcher Lisa Grabert of the Marquette University College of Nursing outlined how the federal government has relied on insurers to trim costs to the overall healthcare system by taking on risk. That will make it more challenging now to control practices that assist them in managing that risk. If the tools are altered, the risk could revert back to the government in the form of higher costs. One intervention that aims to manage risk management tools could cost more than $16 billion in approved care that is currently being avoided, Grabert noted.

The subcommittee members, however, seemed drawn to stories of individual stress and concerns about coverage.

They heard on Wednesday from Connecticut widow Gloria Bent, who outlined her challenges in getting her husband intensive therapy after having a brain lesion removed and suffering physical and cognitive losses.

Gary Bent was denied intense acute therapy and instead approved for short-stay SNF care. But he began receiving notices for pending non-payment before his care plan was even completed there. Over seven weeks, Bent’s family won two appeals and lost a third. He was discharged from a nursing home and rehospitalized the next day.

“The reappearance of melanoma in 2022 pulled a rug out from under my husband and my family,” Gloria Bent testified. “Then came the added trauma, which piled on steadily, of having to fight to keep him receiving the care he needed. This should not be happening to families and patients. It’s cruel.”

Awful scans, missing documents, and most importantly wasted time…

I mean, we have patients to see, folks!

No one, and I mean no one, has time for that. 

Well, some good news for all of you in the industry secondary to part of the Biden-Harris administration’s ongoing commitment to increasing health data exchange and investing in interoperability.

In December of 2022, the Centers for Medicare & Medicaid Services issued a proposed rule aimed at improving patient and provider access to health information and streamline processes related to prior authorization for medical items and services. 

Yesterday, wasting no time, United Healthcare released their response to this proposal and would expect others to follow suit.

I also appreciate that most care providers don’t have time to read every fine line of proposed and final rules, so here is my attempt at an overview of the key points.

First, what is CMS’s goal here?

CMS proposes to modernize the healthcare system by requiring certain payers to implement an electronic prior authorization process, shorten the time frames for certain payers to respond to prior authorization requests, and establish policies to make the prior authorization process more efficient and transparent. 

Second, how is data exchange between providers included as this is often the biggest headache?

The rule proposed to require certain payers to implement standards that would enable data exchange from one payer to another payer when a patient changes payers or has concurrent coverage, which is expected to help ensure that complete patient records would be available throughout patient transitions between payers.

Specifically, “CMS is committed to strengthening access to quality care and making it easier for clinicians to provide that care,” said CMS Administrator Chiquita Brooks-LaSure. “The prior authorization and interoperability proposals we are announcing today would streamline the prior authorization process and promote healthcare data sharing to improve the care experience across providers, patients and caregivers — helping us to address avoidable delays in patient care and achieve better health outcomes for all.”

Sounds great! So how are we getting this done?

The proposed rule addresses challenges with the prior authorization process faced by providers and patients. 

Proposals include requiring implementation of a Health Level 7^® (HL7^®) Fast Healthcare Interoperability Resources^® (FHIR^®) standard Application Programming Interface (API) to support electronic prior authorization. 

Whew, that is a mouthful, but read that line and those terms again. In the future, they will become so commonplace in healthcare that we all must be comfortable with their use. 

Ok, I get that, but what about all of the denials we are hearing about? How does this proposal address denials?

The proposal also includes requirements for certain payers to include a specific reason when denying requests, publicly report certain prior authorization metrics, and send decisions within 72 hours for expedited (i.e., urgent) requests and seven calendar days for standard (i.e., non-urgent) requests, which is twice as fast as the existing Medicare Advantage response time limit. 

Finally, and most importantly, let’s review how this proposal aims to improve quality for patients. 

The proposed policies in this rule would also enable improved access to health data, supporting higher-quality care for patients with fewer disruptions. 

This would be achieved via policies including: 

• Expanding the current Patient Access API to include information about prior authorization decisions; 
• Allowing providers to access their patients’ data by requiring payers to build and maintain a Provider Access FHIR API, to enable data exchange from payers to in-network providers with whom the patient has a treatment relationship; 
• And creating longitudinal patient records by requiring payers to exchange patient data using a Payer-to-Payer FHIR API when a patient moves between payers or has concurrent payers.

The proposed rule is available to review here, with a recent deadline to submit comments is March 13, 2023. 

Stacks of papers be gone! The world of automated pre-authorization is near but let us not celebrate prematurely. 

The data and documentation to allow these systems to provide us the needed care allotments is still on us. 

Time to stay tuned in to our managed payers response and ensure we continue to provide all needed information to promote the highest possible care delivery for those we serve. 

Renee Kinder, MS, CCC-SLP, RAC-CT, is Executive Vice President of Clinical Services for Broad River Rehab. Additionally, she serves as a member of American Speech Language Hearing Association’s (ASHA) Healthcare and Economics Committee, is a member of the University of Kentucky College of Medicine community faculty and is an advisor to the American Medical Association’s Current Procedural Terminology CPT® Editorial Panel. She can be reached at rkinder@broadriverrehab.com.

The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.

Providers demanding change to the Medicare Advantage program may soon get their wish after a House panel advanced a measure that would reform the program’s prior authorization process. 

The proposal, titled the Improving Seniors’ Timely Access to Care Act of 2022, aims to reform the prior authorization program under Medicare Advantage to ensure seniors get necessary care. The number of seniors enrolled in Medicare Advantage programs continues to swell each year.

The legislation would specifically establish an electronic prior authorization program, while also standardizing and streamlining the process for routinely approved services. MA plans would also be required to annually publish specified prior authorization information, including the percentage of requests approved and the average response time under the proposal. 

The measure was pushed forward by the House Ways and Means Committee and is currently in the House Committee on Energy and Commerce. 

The legislation comes after a federal watchdog report found that Medicare Advantage organizations often improperly denied or delayed services — even though the requests met Medicare coverage rules — in order to increase profits.

Post-acute facilities were among the healthcare services often involved in denials that nonetheless met Medicare coverage rules.

The investigation also found 13% of prior authorization requests that MA plans denied met Medicare coverage rules. In addition, it determined that 18% of payment requests that were denied met Medicare coverage and billing rules.

Provider groups have since called on the federal government to conduct an investigation into Medicare Advantage organizations over the improper denials.

In December 2021, the AMA conducted a survey of more than 1,000 practicing physicians about each of the five prior authorization reforms outlined in a 2018 AMA consensus statement.

According to the results of the survey, less than one out of 10 physicians (9%) contract with health plans that offer programs that selectively apply prior authorization requirements. The vast majority of responding physicians (84%) indicate that both the number of drugs and medical services requiring prior authorization has increased since the release of the consensus statement.

More than six in 10 participants report that it is difficult to determine whether a drug (65%) or medical services (62%) requires prior authorization. Nearly nine in 10 physicians report that prior authorization interferes with continuity of care, while only one-quarter say that their electronic health record system offers electronic prior authorization for prescription medications.

“Waiting on a health plan to authorize necessary medical treatment is too often a hazard to patient health,” Gerald E. Harmon, M.D., president of the AMA, said in a statement. “Authorization controls that do not prioritize patient access to timely, optimal care can lead to serious adverse consequences for waiting patients, such as a hospitalization, disability, or death. Comprehensive reform is needed now to stem the heavy toll that continues to mount without effective action.”

More Information

A lack of workers isn’t the only COVID-19 complication slowing skilled nursing admissions.

A new report finds Medicare Advantage restrictions are also creating log jams in hospitals desperate to discharge patients to post-acute care and free up needed beds.

The problem is especially pronounced in states with high COVID-19 case rates, several hospital executives and association leaders told Modern Healthcare this week. Healthcare leaders said the prior authorizations needed to send no-longer acute patients on to post-acute care have always come slowly in states like Florida, Louisiana and Oregon. But the problem is limiting access to care for would-be hospital admits during the ongoing delta surge.

“It’s equally about that (outgoing) patient, but it’s also equally about that patient that needs that bed turned over,” said Robert Peltier, M.D., chief medical officer of North Oaks Health System in Hammond, LA. His health system averages five Medicare Advantage patients at a time waiting to be discharged to post-acute care.

Many Medicare Advantage plans have suspended their restrictions during this stage of the pandemic, but their replacement requirements and expiration dates vary. Humana’s waiver for Louisiana lasts until Sept. 17, while Florida Blue’s is open-ended. 

“The challenge when it is not being directed by a state or federal agency is you have significant variation from one plan to the next as to how they are providing the flexibility, which creates more confusion at a time when we need to minimize as much confusion as possible,” Mary Mayhew, CEO of the Florida Hospital Association, told Modern Healthcare.

In places where waivers exist, they can be highly effective. AdventHealth in Altamonte Springs, FL, estimated waivers issued by some Medicare Advantage plans cut transitions into post-acute care down to about 24 hours.

“If the waiver goes away, we are concerned hospitals could return to seeing delayed transfers contribute to challenging capacity constraints,” said Lisa Musgrave, vice president of home care administration and post-acute services.

The American Hospital Association has been working with the Centers for Medicare & Medicaid Services and Medicare Advantage organizations to “encourage adoption of these waivers.”

For its part, the Centers for Medicare & Medicaid Services issued a memo August 20 that “strongly encouraged” plans to relax prior authorizations “to facilitate the movement of patients from general acute-care hospitals to post-acute care and other clinically-appropriate settings, including skilled nursing facilities.”

Whether skilled nursing facilities could accept patients more quickly if prior authorizations are lifted remains to be seen. Kristen Knapp, spokeswoman for the Florida Health Care Association, said the larger issue “is all about staffing.”

A survey of FHCA members in early August found half had had to reduce admissions in the previous month due to worker shortages.

“The workforce crisis is real, and while we want to be good community partners during the surge, nursing centers right now are doing everything they can to maintain and recruit more staff to support the patients they are currently caring for,” Knapp told McKnight’s Long-Term Care News on Wednesday.

The administration’s Campaign to Cut Waste, which was launched almost two years ago, saved $7 billion in Medicare fee-for-service payment errors between 2010 and 2011, according to the OMB. Waste reduction efforts decreased Medicaid payment error rates between 2009 and 2010 for a savings of $4 billion, The Hill reported.

Additionally, Kathleen Sebelius, Secretary of the Department of Health and Human Services, announced the launch of new demonstration programs that target Medicare and Medicaid fraud, waste and abuse. They will be overseen by the Centers for Medicare & Medicaid Services.

The programs include an expansion of Recovery Audit Prepayment Reviews (RACs), which will allow the agency to review claims before they are paid to assure provider compliance. The reviews will focus on seven states with high rates of fraud and error, including Florida and Illinois, and four states with high claims volumes of short inpatient hospital stays. CMS also is enacting prior authorization for certain medical equipment.

For more information about RACs, click here; for more on prior authorization programs, click here.