Prior Authorization

In 3 states, long-sought reforms tackle administrative burdens

Andis Robeznieks , Senior News Writer

Physicians at the state level have been successfully pushing back against the increasingly burdensome prior authorization requirements imposed upon them by health insurance companies.

State medical societies in Delaware and Ohio, as well as several other states, worked to pass prior-authorization (PA) reform bills recently and, earlier this year, New Mexico lawmakers approved a measure limiting step therapy.

Keys to these victories include building a broad coalition of support and repeating a focused message about why reforms are needed. The AMA’s advocacy efforts, research and model legislation also have been essential.

“We sounded like a broken record for the two years of this battle,” said Tim Maglione, Ohio State Medical Association (OSMA) senior director of government relations. “We never said ‘Let’s ban prior authorization.’ If it’s a tool you use, that’s fine. But we said, ‘Let’s make it more transparent, more efficient and more fair.’”

The Ohio measure was signed into law in 2016 and its implementation will be completed this year. It was backed by a coalition of 80 organizations, including local medical associations and regional chapters of national specialty societies, associations for other health professionals, patient and consumer advocacy groups, and large health systems such as the Cleveland Clinic.

Legislators heard how, at the famed health system, repeat faxes had to be sent an average of 430 times each month because the first one wasn’t acted on. And, at least 2,000 times a month, five-plus calls had to be made regarding the status of a PA request.

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Susan Milheim, senior director of Cleveland Clinic’s revenue cycle management department, testified that 175 “caregivers” did this work at a cost of $9 million in 2015, and that $900,000 was added to the budget for 2016 because of the increasing number of PA requirements.

A recent AMA survey reflects her testimony. Nearly 90 percent of the 1,000 practicing physicians surveyed reported that administrative burdens related to PA requests increased in the last five years, with most saying it “increased significantly.”

The AMA’s model bill has been used as a foundation for many state reform efforts. Delaware’s law closely mirrors it—especially in the provision requiring health plans to accept electronic PA requests.

“We used the AMA’s model bill as a template to draft Ohio-specific legislation,” said Maglione.

The New Mexico step-therapy bill had bipartisan sponsorship and goes into effect this May. New Mexico Medical Society Associate Executive Director Annie Jung said the measure’s impact will come into sharp relief in early 2019.

It has been a “recurring theme” that, at the beginning of each year, parents who switch plans learn their children cannot automatically renew their asthma medication prescriptions, she said. Jung explained that step-therapy requirements made these patients “start from ground zero” with their treatment.

“Next January, a lot of parents and pediatricians will be happy,” she said.

Getting laws passed in Delaware, New Mexico, Ohio and many other states took multiyear efforts, and strong efforts are ongoing in Maine, Pennsylvania and other states to address utilization management processes.

In Kentucky, a PA-reform bill received a sympathetic response in a state Senate hearing but the measure never made it to the chamber’s floor during a tumultuous legislative session.

The Kentucky Medical Association (KMA) made the issue one of its top priorities during this session, distributing information, including data provided by the AMA, to members, said KMA Director of Advocacy and Legal Affairs Cory W. Meadows.

Bruce A. Scott, MD, vice speaker of the AMA House of Delegates, is a Louisville, Kentucky, otolaryngologist, and he testified before the state Senate on the bill. In his testimony, he noted that one of his partners tracked prior authorization for imaging studies that he ordered over a seven-month period in 2017. Of 264 studies his colleague ordered, 50 percent required prior authorization. Only four were denied initially, but after appeals in which the physician spoke to his physician peer at the payer, these imaging studies also got the prior auth approval.

“What a waste of resources,” Dr. Scott said.

KMA partnered with  other stakeholders to build a coalition of supporters, including patient advocacy groups, Meadows said. In addition to one-pagers and talking points, the supporting coalition also provided regular messaging via social media to raise awareness and increase education about the prior-authorization process and the problems associated with it.

KMA hopes to collaborate with payers in the state to work on voluntary agreements to fix prior authorization, but will pursue legislation again next session if those conversations fail to make adequate progress.