CMS final rule 2024: The AMA prior authorization win and the pros and cons of prior authorization [Podcast]


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AMA Update

CMS final rule 2024: The AMA prior authorization win and the pros and cons of prior authorization

Mar 29, 2024

What is the new CMS rule for prior authorization? What is the CMS rule for interoperability? What triggers a prior authorization? Is prior authorization good or bad?

Our guest is Jack Resneck, MD, immediate past president of the American Medical Association. AMA Chief Experience Officer Todd Unger hosts.


  • Jack Resneck Jr., MD, immediate past president, AMA

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Unger: Hello and welcome to the AMA Update video and podcast. Earlier this year, we had an important win for physicians and patients in right-sizing prior authorization thanks in large part to AMA advocacy, and today, we're taking a behind the scenes look at the years of work that went into making that win possible. And our guest today is the immediate past president of the AMA, Dr. Jack Resneck, who's joining us today in our Chicago studio. I'm Todd Unger, AMA's chief experience officer. And welcome, Dr. Resneck. It's good to have you in the studio.

Dr. Resneck: Thanks, Todd, great to be here again.

Unger: Well, Dr. Resneck, let's start with the CMS final rule that was announced in January. This is a huge step toward fixing prior authorization, but obviously, it's not something that just kind of happened overnight. It's been years in the making. Let's start with a brief overview of what's in the rule and why it's such a big win for physicians.

Dr. Resneck: Well, Todd, this has been an obsession of mine for years, and the reason is that it is such an enormous burden for physicians across the country as we just try to provide evidence-based care to our patients. When we think about things that get in the way of what drew us to health care in the first place and to this profession, this has really come to the top of the list. So it's something we've been working on for a long time, really excited about what is really a pair of two rules that CMS put out over the course of the last year.

And when you look at them taken together, there are a lot of great things in there. It doesn't solve every problem. The last bill, actually—it's been estimated that it's going to save physician practices $15 billion over 10 years. Now, it's part of a broader scope of AMA work for physician practices to survive. Obviously, we also have to fix Medicare payment and the cuts and other things that are going on, but this is still a really important win.

Because this is being done by CMS and by the federal government, it turns out that there are parts of the health care system that they can regulate so that this rule will affect, and there are parts that are actually regulated by the state. So that's why we're working on this all over the country. This mostly affects things like Medicare Advantage plans and some of the Medicare Part D plans, some Medicaid plans, CHIP, even a few of the exchange plans that are out there.

The other thing about this rule is that it does affect tests and procedures a little bit more than medications, and that's something we're working to broaden. But when you look at the rules, some of the things that I'm really excited about are, A, treating Medicare Advantage plans like other traditional Medicare plans in terms of what they have to cover. You can't have all these independent insurance companies out there just making up their own rules out of whole cloth about how they're going to treat different diseases and what we, as physicians, are going to be able to do with our patients.

And when there isn't a Medicare rule on coverage for something, they actually have to look to nationally-accepted rules like things that come out of our specialty societies in terms of what's appropriate care. Continuity of care—another big one. We see patients who every time they switch plans, if they end up on a different Medicare Advantage plan every January, they and their physician have to re-prior-auth every medication they're on. So this guarantees that for 90 days they actually continue to get coverage while that process goes on. Approvals actually have to be for as long as the treatment is medically necessary. They can't just revoke it a few weeks later.

The people who are reviewing the appeals—this is another big piece. We, as physicians, experience this all the time where you end up on an appeal on the phone with somebody who usually isn't a physician. Even if it is a physician, they're maybe not from your same specialty. They've never heard of some of the diseases you're treating, so that gets addressed in this.

Things like having the ability in your own electronic health record to actually see what requires prior auth, to file the prior auth right there instead of going off into some different website with 100 different passwords for all the different insurers, and being able to view the status, health plans actually having to provide the reasons for denials and to be transparent to the public about how many times they deny different test procedures or medications. So it's not perfect, but these are a lot of things that we, as physicians, have been asking for. So it's a big step in the right direction.

Unger: That's really an understatement because when I hear you list all of those changes and just from hearing you talk about it and from other physicians about the obstacles that those things represent, it is a huge win, and of course, you talked about the financial impact of $15 billion worth of savings over the course of time. So this is very exciting, but underneath that, again, years of work, and some not very exciting stuff, like getting the data to support movement on a front like this.

One of the things that we've done with physicians—it is our annual survey about prior authorization with physicians. What's the impact of a survey like this on reform?

Dr. Resneck: We have reputation, as the American Medical Association, that we bring data to these fights, and that makes a big difference as we work with policymakers and lawmakers around this. And when I testify or advocate for something like prior auth reform, being able to combine the real-world data to support what we're fighting for but also to combine that with the anecdotes and the stories, it's a great combination.

So the survey you mentioned is one we've been doing for seven years, so we now have longitudinal data. And it actually has shown that the prior auth problem has been getting worse when we look at the average number of prior auth that physicians do, the amount of hours that they and their staff spend every week working on filling these out when they could be providing care to patients. That average number, by the way, has gone up to 45, the average physician in the country is filling out 45 prior auths per week. It's totally unacceptable.

And we know that the data and the survey make a difference because every media story now that we get on prior authorization when we're out there talking about it mentions those numbers. CMS, when they actually put out their rules, cite those data, so they're having an effect. We see—when I go to some of these hearings, we'll see health plans basically trying to describe that, oh, we need prior auth on all these things because doctors are out there providing inappropriate care or that it's all about these new $100,000 drugs or really expensive, unproven tests.

And it's useful to have these data and our stories to go with what's actually happening on the ground and our lived experience. Oftentimes when I'll go—I will literally bring the last 10 prior auths I filled out from that morning in the hotel room on my computer or on my EHR. And usually eight or nine of the 10 are for a generic medicine that's been around for decades, so it illustrates what the health plans are really doing, which is trying not to spend money treating the enrollees who've paid premiums to get their benefits. So the data are incredibly helpful.

Unger: And I love the combination, too, of—and we've heard even from folks in Congress hearing physician stories but also that combination of then the data to back it up.

Dr. Resneck: Yeah. You never know what's going to catch. I was testifying once and told a story that I was living at the time about a patient who actually was on an expensive biologic medication with a really severe condition who tried everything else. And it had changed their life. They were back at work. Their family would come in and give me hugs because they were a good parent and a spouse, paying taxes.

Basically, totally, their disease was treated, and they were doing great. And they reached 12 months into their therapy, and the insurance company said, well, you need to re-prior-auth it now because it's been a year. We see this happen all the time. So I dutifully filled out all these forms on paper, pushed through a fax machine, which is a whole other crazy part of this prior auth process. And I talked about how to change their life and how much better their disease was, and it was rejected.

And the reason that came back for the rejection was "Patient no longer meets severity criteria," which is so ironic. That means the drug is working. And they literally were telling me that I had to take the patient off the medication, let their disease flare up, and then they would qualify again. It took 20 phone calls to get that overturned.

So I described that as kind of a Kafkaesque experience, which is what we run into so much as physicians with prior auth, and that actually ended up catching a lot of media. I was a little nervous when I realized they were picking up my Kafka quote all over the place because I hadn't actually read Kafka, probably, since high school, but yeah, so the stories can be helpful as well as the data.

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Unger: It is surreal when you think about that situation. Now, you mentioned upfront that the rule applies to a certain set of things around prior auth, but there's still a lot of work at the state level that has to go on. Tell us a little bit more about the interplay there between the federal and the state.

Dr. Resneck: This is where it's really great for an organization like the AMA to have the resources we have to be able to fight battles on multiple fronts and to have partners across the country. So because of the way health care is regulated and because it's so complicated, there's a simple reality that if the health plans are not doing a good job of rightsizing prior auth and we have to seek legislation to get this fixed, we have to go to Congress. We have to go to HHS because those are the entities that regulate some of the federal government plans.

But we also have to go to states, and a lot of commercial health care entities are really—and a lot of people who get their employer-provided insurance—that's really regulated at the state level, and it means going into all 50 states. It's a lot of work, but we have a great team that can do that work.

And we partner really closely with state medical associations, with specialty societies, with patient organizations, and others when we do that. So we have what we call model legislation, which are essentially bills that people can take right off the shelf that we've already written. And those have been used in a lot of these state battles, and then you can tailor it to your state and things that might make more sense in some areas than others. And again, that model legislation has been the basis of almost all the comprehensive bills that we've seen in the states.

We bring a lot of resources that we offer to those state medical associations doing that work and to the legislators who want to partner with on this. We have the survey data that you mentioned. We have charts about state law across the country, draft testimony that can help physicians prepare when they're going to go talk about their experiences. We actually have attorneys and others who can do real-time bill analysis as the language develops.

And we have lists of the successes from other states that states who are engaging this now can apply to their efforts. The momentum is building, so I think there are more than 17 states who have now adopted comprehensive prior auth reforms. We still got a bunch to go, but it's a great start. And when we look at 2024 and the legislative sessions in the states that are happening now, we've got over 100 prior auth bills in something like 30 states. So we're working on this across the country so that every patient and every physician gets the benefit of rightsizing prior auth.

Unger: Well, that is a lot of work, a ton of resources at both the federal and state level that you've outlined, but the AMA does more than advocate to policymakers. We also deal directly with private insurers to push for reform, and in fact, a few years ago in an advancement on that front really laid the foundation for our recent win with CMS. Tell us a little bit more about how that works.

Dr. Resneck: Yeah, we started with the notion that it's important to try to work with the health plans to see if we could find some win-wins on this. So several years ago, we gathered the chief medical officers of many of the major health plans in the country along with other groups representing physicians and patients, and actually right in this building, here at AMA, we had about a half a dozen face-to-face meetings.

And we came up with a lot of shared ideas about how to improve this that are actually the same things that you see in what we're doing at HHS and what you're seeing in the model bills. So whether that's reducing the volume, prior auth needs to get back to just being focused on, again, those brand-new really expensive things and not being applied huge percentages of what we deal with.

Gold carding, which is something we've talked about before, where physicians who ultimately get 95% of their prior auths approved and are clearly providing evidence-based care—it's kind of like TSA PreCheck. Why are they being subjected to prior auths at all? Continuity of care, being able to do prior auths right in your electronic health records.

So we put out in 2018 a consensus statement that several of those health plans signed onto with their logos and our logo, and I sort got good news and bad news on that front. The bad news is most health plans never actually enacted any of those reforms that we all agreed to, and that's why we've had to turn to the legislative approach and to working with the executive branch.

There have been a couple of signals. Cigna and United announced some reduction in volume this year, and we're eager to see that actually play out and are watching to see how that goes. So that's been the bad news, but the good news is having gone through that process really paved the way for CMS and for the administration to take the regulatory action that they're taking now. So they've really used that agreement as a model. They've used the fact that things didn't progress as much as we'd hoped from the health plans, so that process has turned out to be really helpful for us.

Unger: Now back to a little bit of the behind-the-scenes work that's always kind of going on out there. Talk to us a little bit about the work with CMS and about how our advocacy has happened over the past few years to lead to a point like this.

Dr. Resneck: Yeah, I've reflected that I really feel like physicians and patients have been heard by CMS on this issue, and it has shown in the work that they're doing and how seriously they have taken creating these two rules. And when you look at the rules, there's so many things that actually make sense and are exactly what we asked for and that I know we're going to help us take better care of patients and have patients get better access.

I've had several meetings with the administrator and her team, and my predecessors and successors have done the same. And previously, I think we were seeing from CMS, Medicare and Medicaid a notion that prior auth could be solved with technology. Let's just automate things so it's easier to fill out the forms and submit them.

And the problem with that is it just allows health plans to submit more and more drugs and tests and procedures to this whole process, so you're running faster on that treadmill. And I think they understand now that real reform is needed, and that's been really reflected in these rules. So we're seeing real change with those. They continue to collaborate with us on making sure that this gets expanded to cover more things in the prescription space, so it's been a good process with them.

Unger: Excellent. Now, you mentioned up front this has been a passion of yours for a number of years. I always remember some of the things that you've worked in your speeches before the House of Delegates on this topic. You've got to feel a sense of accomplishment to see something come to fruition like this, again, lots more work to do. But talk to us a little bit about how it feels to see an achievement like this this.

Dr. Resneck: This is a great issue to work on because it's one where you know that we're in the right, and we live the experiences where our patients can't get the medications that they need, they delay care, they end up getting sicker. And so it's one where we're really tightly aligned, physicians and patients, where you know you're on the right side. And because so many policy makers and others out there have themselves experienced it, it's actually easy to explain. So that makes it one of the more fun issues to work on when you put all those things together.

One of the things about these roles, like being an AMA president or a past president, is it's fun to have a megaphone. When there's something you're really irritated about and you know that it's not working right, having that megaphone is really a positive experience. It is a privilege to get to represent the profession. And there are projects like this that as much as we wish we could fix them in a day or a week, they're multi-year projects to get to where we know we need to go, and that's just the reality of how policymaking works in our country and in the states.

But at the AMA, we bring together the profession. We have a House of Delegates, where people debate and talk about how to move forward with a policy, and that creates the underlying policy that allows us to do this work. And then we have consistent work, whether it's by our board or our management team or our staff or our advocates who are out working in state houses and in Congress on these.

And so it is so gratifying, as we end up inevitably handing these off among multiple people and working as a team, to actually see something like the state bills pass, to see CMS taking on these reforms. Yes, every day physicians are still struggling with prior auth, but I know that over the next few years this burden is going to get substantially reduced because of the work of so many people and physicians across the country.

Unger: Absolutely, and to all the physicians who are out there and their teams that experience the frustrations of prior auth, some of whom are going to benefit from what we've talked about already today but still are facing the challenges out there from the things that haven't been addressed yet, how do you—how do you encourage them to fight back against obstacles like this?

Dr. Resneck: There are a variety of ways to do that, and I see physicians who are leaving their practices and coming to AMA meetings and are lobbying Congress. We just had the national advocacy conference a few weeks ago, where physicians across the country came to DC. That's one way to do it.

There are also people who over the arc of their careers—this is not the right time to take off and run off to DC, but just knowing that an organization like the American Medical Association is doing this work is so important, so just by joining that's actually a step in leadership. And maybe at some other point in your career you'll be the one heading off to DC, so it's gratifying to see so many physicians joining the American Medical Association. It gives us the power to go and do this work.

Unger: That's great, and that's a great way to segue here at this point. Dr. Resneck, what a pleasure to have you here in the studio. Physicians out here, this is why we fight, to make sure to remove obstacles like this and, again, get you back to what you want to do, which is to treat your patients and make them better.

So to support the AMA's important advocacy for physicians and patients, make sure to join us, That wraps up today's episode, and we'll be back soon with another AMA Update. Be sure to subscribe for new episodes, and you can find all our videos and podcasts at Thanks for joining us today. Please take care.

Disclaimer: The viewpoints expressed in this video are those of the participants and/or do not necessarily reflect the views and policies of the AMA.

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