Prior authorization review, which is embedded in the U.S. healthcare system, is blamed both for driving up costs and frustrating patients and providers.
“Other than out-of-pocket costs, I would wager that prior authorization review is the one thing consumers find most burdensome in our current health system,” says Drew Altman, president and CEO of KFF. “A proposal to eliminate prior authorization altogether could be the single most tangible and popular ‘health reform’ idea a candidate could propose, Republican or Democrat.”
All too often, prior authorization becomes a duel between the competing interests of insurers and providers, with patients caught in the middle.
“Everybody thinks they’re the good guy in the prior authorization dance,” Altman says. “There’s the doctor, who 99% of the time is looking out for the patient. There’s the insurance company, which thinks it’s on guard against unnecessary and unnecessarily costly care and bad-apple doctors. And then there’s the patient, who may be waiting anxiously for the results of a crucial test or hoping that a procedure will bring relief.”
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Progress is being made, although in small, incremental steps. Nine states have enacted legislation aimed at making prior authorization less burdensome for patients and providers. This includes so-called “gold carding,” which essentially exempts physicians who have good track records of ordering needed services. Another approach is to eliminate or restrict prior authorization for ongoing care for patients with a chronic illness. Restricting the role that artificial intelligence plays in reviews by requiring an actual physician to approve any determination is another emerging trend.
Public options are also experimenting with reform. The Center for Medicare and Medicaid Innovation recently introduced WISeR, the Wasteful and Inappropriate Service Reduction Model, for selected services in six states. The administration and a group of insurance companies previously announced a voluntary initiative to streamline prior authorization and make it less burdensome. However, a KFF poll at the time showed that consumers have little confidence that insurance companies will follow through on the initiative.
Even with these reforms, however, Altman says, don’t expect prior authorization to go away any time soon.
“Prior authorization is down but far from out, and we are almost certainly stuck with prior authorization with some modifications around the edges,” he says. “It’s an example of the ‘small ball’ featured in cost containment in health today. However, the impact of getting rid of prior authorization cannot only be measured by actuaries in premium increases. There are also the benefits to be found in reduced complexity, hassles, anxiety and administrative costs that limiting or eliminating prior authorization would have for patients and health professionals who have to struggle through the prior authorization maze.”
