The Centers for Medicare & Medicaid Services (CMS) released their Jan. 17 Interoperability and Prior Authorization final rule aimed at improving the electronic exchange of health information and prior authorization processes for medical items and services [refer to Washington Highlights, March 17, 2023]. The final rule applies to specific CMS-regulated payers, including Medicare Advantage organizations, state Medicaid and Children’s Health Insurance Program (CHIP) Fee-for-Service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan issuers on the Federally Facilitated Exchanges.
Under the finalized policies, impacted payers will be required to provide prior authorization decisions within 72 hours for urgent requests and seven calendar days for nonurgent requests beginning on Jan. 1, 2026. Plans must also provide a specific reason for prior authorization denials. These provisions do not apply to prior authorization decisions for drugs. In addition to these policy changes, the CMS is also requiring these payers to publicly report certain prior authorization metrics annually on their websites. Plans must report their initial set of metrics by March 31, 2026.