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Addressing Prior Authorization Issues

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Prior authorization is a health plan cost-control process requiring providers to obtain approval before performing a service to qualify for payment.

Health insurers frequently require prior authorization for pharmaceuticals, durable medical equipment and medical services. The inefficiency and lack of transparency associated with prior authorization cost physician practices time and money. The lengthy processes may also have negative consequences for patient outcomes when treatment is delayed.

The AMA believes that prior authorization is overused and that existing processes are too difficult. Due to its widespread usage and the significant administrative and clinical concerns it can present, the AMA believes that prior authorization is a challenge that needs to be addressed through a multifaceted approach to reduce burdens on physicians and patients.

Reform Principles

To improve care access and reduce practice burdens, the AMA convened a workgroup of state and specialty medical societies, national provider associations and patient representatives to create a set of best practices related to prior authorization and other utilization management requirements.

The workgroup identified the most common provider and patient complaints associated with utilization management programs and developed the Prior Authorization and Utilization Management Reform Principles to address these priority concerns. These 21 principles seek to improve prior authorization and utilization management programs by addressing the following broad categories of concern:

  • Clinical validity
  • Continuity of care
  • Transparency and fairness
  • Timely access and administrative efficiency
  • Alternatives and exemptions

The principles have gained widespread support since their release, with over 100 stakeholder organizations signing on in support of their objectives. These supporting organizations are listed at the end of the resource.

Prior Authorization Research

In conjunction with a market research partner, the AMA fielded a web-based, 24-question survey to 1,000 practicing physicians in December 2016. The national sample comprised 40% primary care and 60% specialty physicians and included only physicians who routinely complete prior authorizations in their practice. The survey results show the significant burden that prior authorization policies can have on physician practices.

In 2016, the AMA and Dartmouth-Hitchcock Medical Center released a qualitative study exploring fundamental sources of physician satisfaction and dissatisfaction, and the effects of administrative work on practices. This research includes first-hand physician perspectives on the burdens that prior authorization processes place on their practice and delivery of care to their patients.

Prior Authorization Practice Resources

Since health plans will likely continue to use prior authorization as a resource utilization control for the foreseeable future, the AMA offers resources to help minimize the impact of prior authorization on practices in the current environment. 

The Prior Authorization Toolkit provides an overview of the current prior authorization landscape, including the status of electronic prior authorization (ePA) adoption; the toolkit also looks ahead to the future of prior authorization and the industry efforts and changes that will create a more efficient process.

Additional Advocacy

The AMA advocates on multiple fronts, including through model state legislation and testimony to federal advisory councils, to reduce the burdens that prior authorization places on physicians and their staff.

The AMA has model legislation that aims to reduce the administrative burden prior authorizations place on practices and streamline the process to prevent delays in care.

The National Committee on Vital and Health Statistics (NCVHS) is a federal advisory body charged with making recommendations pertaining to electronic health care transaction standards and administrative simplification to the U.S. Department of Health and Human Services (HHS). The AMA has advocated extensively with NCVHS to streamline the prior authorization process.

LinkedIn Group

The AMA Administrative Simplification LinkedIn Group is designed to provide updates and encourage dialogue on administrative issues affecting physician practices, including automation using electronic standards and operating rules, prior authorization standardization and reform, and regulatory developments. Physicians, practice staff and other interested stakeholders are encouraged to join.

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