Expert Commentary

A health care journalist’s guide to prior authorization

Health insurance companies argue that prior authorization can reduce unnecessary procedures and health care costs. But doctors have concerns about the frequency of these requests, even for routine procedures, and the administrative burdens associated with them.

prior authorization

This article was updated on Dec. 27 with a section on prior authorization requirements for HIV prevention drugs.

Doctors and insurers in the United States are often at odds about whether people should get certain medical treatments, including prescription drugs. Consumers sometimes get dragged directly into these battles when insurers challenge physicians’ decisions in a process called prior authorization.

In many cases health insurance plans cover procedures and medications that are prescribed to patients. Often, though, insurance companies demand additional information from doctors and other medical professionals to justify their prescriptions and orders. In the medical field this is known as prior authorization or preauthorization.

Health insurance companies argue that the process can reduce unnecessary procedures and health care costs.  Health plans use it as a tool, for example, to check that potentially addictive painkillers are being used appropriately as part of the national response to the opioid crisis.

But doctors are critical of how insurers design their processes for handling prior authorization requests. They have raised concerns about  both the frequency of these requests, even for routine procedures, and the administrative burdens they face due to demands for hours spent on the telephone or faxing documents to insurance companies.

In Health Affairs in October 2020, David Cutler, an applied economics professor at Harvard University, writes about what he deems the “needlessly complicated” processes used in prior authorization as an aspect of medicine in need of reform. For example, an insurer may ask a doctor for more information about a patient before approving a radiology test. But much of the information sought may already be in the patient’s electronic medical record and could be more easily conveyed to the insurer’s review staff through this path. But health plans instead often require a more burdensome, relatively antiquated approach involving faxes and phone calls.

“To document this, the provider’s office must fax information from the medical record to the insurer, who then reviews it all before reaching a decision,” writes Cutler in his blog post, titled “Taming the Paper Tiger.” “A more streamlined way to do this would be to have the provider’s EMR system attest that the patient meets the relevant criteria, avoiding all the human interaction.”

In a 2020 survey of 1,000 doctors by the American Medical Association, 58% said phone calls with insurance companies were often or always required to complete a prior authorization request for prescriptions, with 59% saying this was true for prior authorization requests for medical services. Regarding faxes, 48% of respondents said these were always or often necessary, while 46% said this was the case for requests for medical services.

“It seems like every step in the process is designed to make the patient less likely to get the therapy that the doctor thinks that the patient needs,” Dr. Susan Bailey, then president of the AMA, said in a May interview with Medscape Medical News. “It’s almost like rationing care by hassling the patient and the physician.”  

Bipartisan support for streamlining the prior authorization process

There’s widespread agreement that the process needs improvement. Physician organizations including the AMA have persuaded many members of Congress of the need for reforms to the pre-authorization process, at least in terms of the insurer-run programs that manage Medicare benefits for people, known as Advantage plans.

A House bill introduced in May, aiming to speed up the prior authorization process, has gained bipartisan support.

The bill, the Improving Seniors’ Timely Access to Care Act (HR 3173), has the support of 141 Democrats and 111 Republicans, or more than half of the members of the House of Representatives, as of Dec. 20.  You can check here to see which members of Congress have sponsored the House bill. A companion Senate measure had the backing of five Republicans and six Democrats as of Dec. 20, as shown here.

These bills would address prior-authorization procedures only for the insurer-run Medicare plans.  These plans cover about 26 million people in the United States, according to an estimate from the nonprofit Kaiser Family Foundation. The majority of people in Medicare are age 65 and older. Groups that support these bills, including the American Medical Association, expect that there would be a ripple effect among health plans: If they are forced to simplify prior authorization for their Medicare Advantage programs, they may do so as well for their other health plans.

Specifically, the bills would push for use of electronic prior-authorization programs, shifting away from use of faxes that frustrates many doctors. The bill also would direct Medicare to require Advantage plans to design systems that could issue “real-time” decisions on prior-authorization requests.

Even insurers have voiced a need to streamline the processes for prior authorization.

In 2018, the trade group America’s Health Insurance Plans joined another large insurance group, the Blue Cross Blue Shield Association, in issuing a public statement on the need for improvement. Also signing this statement were the AMA, the American Hospital Association, the American Pharmacists Association and the Medical Group Management Association.

“The prior authorization process can be burdensome for all involved—health care providers, health plans, and patients,” the insurance and medical groups said in their joint statement.

In the 2018 consensus statement, insurers had agreed to try to streamline the process, taking steps such as removing hurdles for doctors with solid track records for prescribing appropriately.

“Unfortunately, we have seen little to no progress from insurers in living up to the reforms from the consensus statement we agreed to more than 3 years ago,” Dr. Jack Resneck Jr., who is president-elect of the AMA, said in an email to The Journalist’s Resource.

Meanwhile, insurers have expanded use of prior authorization requirements in response to rising costs of medicines. These restrictions applied to about 24% of drugs in 2019 covered by the insurer-run Medicare pharmacy program, known as Part D plans, up from 8% in 2007, Resneck writes in a February 2020 Viewpoint article in JAMA, citing a federal advisory panel. His article, titled “Refocusing Medication Prior Authorization on Its Intended Purpose, details how the insurers’ approach to managing this process frustrates consumers and medical professionals.

“The opacity of frequently changing formularies and prior authorization requirements means that prescribing physicians do not know which treatment options will be filled without delays,” writes Resneck, who also is professor and vice-chair of dermatology at the University of California, San Francisco. 

“Patients arriving at pharmacies to pick up medications and initiate treatment are sometimes surprised to learn that further action is required by their physician to seek health plan approval,” Resneck continues. “Thus begins a process that often includes faxes sent from physician offices to health plans, initial rejections, written appeals, and `peer-to-peer’ telephone calls with adjudicators who sometimes are not familiar with the disease or the disputed medication or who may suggest inappropriate  alternatives.”  

Prior authorization requirements for HIV prevention drugs

Democrats in both chambers of Congress are seeking to end prior authorization requirements for HIV prevention drugs under private and public health insurance plans. As of Dec. 27,  Rep. Adam B. Schiff (D-CA) had 43 Democratic sponsors for his version of a bill that would do this, while Sen. Tina Smith (D-MN) had one for her version of the bill. 

Dr. Kathleen A. McManus of the University of Virginia and colleagues call for this kind of legislation in an article published in JAMA Network Open in June 2020, Regional Disparities in Qualified Health Plans’ Prior Authorization Requirements for HIV Pre-exposure Prophylaxis in the United States.  They report finding significant regional differences in the United States in access to these medicines.

McManus and colleagues examined how 16,853 insurance plans handled payments for Truvada, a combination of two medicines, tenofovir disoproxil fumarate and emtricitabine. The Food and Drug Administration in 2012 approved Truvada for pre-exposure prophylaxis (PrEP) in combination with safer sex practices to reduce the risk of sexually acquired HIV-infection in adults at high risk.

Examining insurance plans’ policies for 2019, McManus and colleagues found that 18.9% of health plans studied required prior authorization for Truvada overall in the U.S., but that the rate of these requirements varied by geographical region. Looking at the rates by region, they found prior authorization requirements for Truvada for 37.3% of plans in the South, 2.3% of those in the Northeast, 6.2% of those in the West and 13.3% of those in the Midwest. 

This disparity was particularly concerning given the increased concern about HIV transmission in the South, write McManus and colleagues. They note that the Centers for Disease Control and Prevention has estimated a lifetime risk of acquiring HIV in the United States of 1:22 for Black men, 1:54 for Black women and 1:2 for Black men who have sex with men. 

“Moreover, the South has higher rates of stigma and bias associated with HIV and the lesbian, gay, bisexual, transgender, and queer or questioning communities as well as higher rates of HIV criminalization laws, which create additional barriers to PrEP uptake in the South,” McManus and colleagues write. “More than half of the African American population in the United States live in the South.”

In their article, McManus and colleagues write that there is limited regulation of health plans’ prior authorization requirements. They note federal or state laws may be needed to “remove this system-level barrier to ending the HIV epidemic in the United States” and expand access to PrEP.

Drawing attention to prior-authorization policies

Shining a spotlight on prior-authorization policies may help bring about change, according to the nonprofit Institute for Clinical and Economic Review (ICER). ICER conducts in-depth analyses of drugs and medical treatments in the United States. 

ICER on Dec. 1 published an in-depth report on insurers’ restrictions on access to prescription drugs, a topic it intends to revisit on an annual basis. While it was conducting this review, six insurers made 10 changes to policies limiting access to prescription drugs, ICER reported. The insurers notified ICER of their plans for changes after reviewing a preliminary draft of the organization’s analysis. Among these was Anthem Inc.’s removal of its prior authorization criteria for the sacubitril/valsartan heart failure drug, effective Aug. 1, 2021, ICER staff wrote in the report, titled “Assessment of Barriers to Fair Access.

AHIP supports use of electronic prior authorization to speed the processing of these requests.

In March, AHIP released a report about the early result from its Fast Prior Authorization Technology Highway—or Fast PATH—initiative done by the consulting firm RTI International. Participating in the project were 6 health insurers—Blue Shield of California, Cambia Health Solutions, Cigna, Florida Blue, Humana, and WellCare (now Centene). Together they cover over 50 million people in the United States. The initiative began in early 2020 and ran for about 12 months, according to the report, titled “Evaluation of the Fast Prior Authorization Technology Highway Demonstration: Final Report.”

RTI International found some improvements in the process. The median time to decisions after implementation of Fast PATH electronic prior authorization solutions fell from 18.7 hours in the pre period to 5.7 hours. But physicians were still left using older forms of communications to address insurers’ questions.

“Some comments collected from survey respondents suggested that there are providers who do not see much benefit from the electronic prior authorization solutions,” write the RTI staff in the report. “These respondents report having to call or fax the health plan even with these tools in place due to issues with getting the prior authorization completed through the electronic” system.

The electronic process also did not change the outcome of the requests, RTI International reports.

“This finding indicates that although electronic processes may lead to shorter times to a decision, the decisions did not change with electronic prior authorization in place because the rules pertaining to prior authorization did not change,” the report states.

Research points to drawbacks of prior authorization

Doctors have many stories to tell about cases where requirements seem more like hassles than thoughtful attempts to protect patients. And in some cases, they also have data that seem to support this idea.

In a 2020 paper, Dr. Aaron Secrest of University of Utah, Salt Lake City, and co-authors find a 99.6% approval rate for prior-authorization requests for two common procedures, suggesting insurers could cut back on these requests, they write in “Administrative Burden and Costs of Prior Authorizations in a Dermatology Department,” published in JAMA Dermatology. They urge insurers to consider cases where unnecessary prior-authorization requests may result in harm to patients, with little or no gain for insurers.

In this paper, researchers analyze the outcome of prior-authorization requests for September 2016 for his school’s dermatology department, which has 11 clinics.

They identified 626 prior-authorization requests stemming from 9,512 patient contacts.

Included in this mix were 95 requests for a procedure called Mohs surgery, in which doctors remove moving a thin layer of skin to treat skin cancer, usually the basal cell kind that’s rarely fatal.

The approval rate for Mohs surgery was 100%, the researchers report. They also find that 130 of 131 requests for excisions were approved.

The authors also describe a case where one of the department’s specialists wanted to give a middle-aged patient the generic medicine cyclosporine for a case of “severely flaring psoriasis,” a painful skin condition.

The prior authorization (PA) hurdle led to a 5-day delay before the patient could start treatment, the authors write. The patient’s condition worsened, resulting in the need for “a prolonged hospitalization” and an infusion of a costly drug, infliximab infusion, to control the acute flare. This cost the patient’s insurance tens of thousands of dollars and substantially affected the patient’s quality of life, they explain.

“The utility of cyclosporine PAs is questionable. Cyclosporine is a relatively inexpensive treatment for moderate to severe psoriasis, and from our experience, it is unlikely to be overused,” they write.

Similar experiences with prior authorization have been reported in other fields of medicine.

Writing in the Journal of Vascular Surgery: Venous and Lymphatic Disorders in May 2020, Dr. Thomas Maldonado of NYU Langone Health and co-authors examine how prior authorization applies to procedures done to improve circulation in the legs. Looking at the cases performed at NYU Langone in 2017, they report that  57.9% required prior authorization.

Of these, only 6.1% received initial denial, and nearly 40% of those denials  were overturned after appeal, Maldonado and co-authors write in their paper, titled “Prior authorization as a utilization management tool for elective superficial venous procedures results in high administrative cost and low efficacy in reducing utilization.”

Writing in Arthritis Care & Research in November 2020, Dr. Zachary Wallace of Harvard Medical School and co-authors report that 96% of prior authorizations were ultimately approved for patients who were treated for rare rheumatoid conditions, in which patients’ immune systems attack their own tissues. 

In their paper, titled, “Treatment Delays Associated With Prior Authorization for Infusible Medications: A Cohort Study,” Wallace and colleagues use electronic medical records to identify subjects for whom expensive medications given by infusion were ordered during treatment at the rheumatology unit of Massachusetts General Hospital between July 1st, 2016 and June 20th, 2018.

Of the 225 patients whose cases were studied, the infusion medications of 160 (71%) required prior authorization. These restrictions were associated with a greater number of days to infusion compared to cases in which no authorization was required, a median 31 days versus median 27 days. The delays were longer in 33 cases where the prior authorization was denied initially, with delays in these cases ranging from  31 to 76 days.

Patients denied the insured drugs had to rely more on medicines known as glucocorticoids, which put them at higher risk for infection, cardiovascular disease, and diabetes, Wallace and co-authors write. These disadvantages for patients were accompanied by extra work for doctors.

“In light of these findings, the value of PA requirements in healthcare is unclear and future studies should prospectively evaluate their impact on other patient-oriented outcomes,” the authors write.

Prior authorization as protection

In an interview with The Journalist’s Resource, Dr. Lee Newcomer, a former longtime top medical officer for insurance giant UnitedHealth, urged reporters to dig beyond simply reporting on cases where a particular patient must wait to get treatment.

He says there is a need for greater recognition of how the prior-authorization process can save money as well as spare patients from treatments unlikely to benefit them, Newcomer says. In many cases, the therapy being sought may simply be highly unlikely to benefit a patient. In the cases of some medications or treatments, “the evidence isn’t there” for its use, he says.

Newcomer cites the example of bone-marrow transplants for breast cancer in the 1990s. There was strong pressure on insurers to cover these treatments well before researchers effectively studied this approach. Once they did, the data indicated the costly and risky procedure did not work for breast cancer, write Dr. Gilbert Welch and Juliana Mogielnicki, then both with the Department of Veterans of Affairs, in a May 2002 article in The BMJ, titled “Presumed benefit: lessons from the American experience with marrow transplantation for breast cancer.”

But Newcomer also has advocated continual pruning of prior authorization requirements. 

Writing in the Journal of Oncology Practice in June 2018, he looks at cancer treatment and how it often triggers a series of prior authorizations for radiation therapy, genetic testing, diagnostic radiology, physical therapy, and durable medical equipment.

“The topics for prior authorization should be evaluated constantly and dropped when ineffective; it is an expensive operation for both the payer and the physician,” writes Newcomer, who served as a top medical officer for insurance giant UnitedHealth from 1991 through 2018.

Titled “Paradox of Prior Authorization: How Do We Get Value?” Newcomer’s editorial looks at different models UnitedHealth had tested for handling prior-authorization.

In 2014, UnitedHealth launched a digital form of prior authorization based on the guidelines of the National Comprehensive Cancer Network (NCCN) for treatment. The NCCC’s guidelines reflect the decisions doctors make in real-world treatment of cancer. The NCCN guidelines can allow for uses of cancer medicines based on study results, even if the Food and Drug Administration has not approved this same use of the medicine. UnitedHealth has tried skipping prior authorization by limiting payments for cancer treatment largely to courses of therapy approved by the NCCN.

UnitedHealth began its new digital authorization for cancer drugs in some of its Florida plans, creating “a natural experiment that allowed comparison of medical trends for oncology therapy,” Newcomer writes.

The cost trend for chemotherapy decreased by 9% in Florida in 2014 among UnitedHealth’s plans, compared with an 11% increase in chemotherapy cost trends for the rest of the nation not using prior authorization. The denial rates for therapy dropped to 1% in Florida.

But this approach did require additional time and effort from cancer specialists. Online processing time ran to about 9.5 minutes, but it took twice as long to complete a case by phone. And some cases may always require that kind of more extensive consultation during the prior-authorization process.

Physicians estimate that 10% to 20% of patients require exceptions from insurers’ rules for “unique clinical circumstances or a new medical discovery,” Newcomer writes. “These treatments require a communication and authorization process between the oncologist and payers. The payer criteria for coverage and the oncologist’s criteria for treatment may differ; one person’s evidence is another person’s anecdote, and only a discussion will resolve the differing viewpoints.”

Additional resources

For a better understanding of the reasons why insurers say prior authorization can protect patients, check out the Choosing Wisely campaign, created by the ABIM Foundation, a nonprofit charitable organization of the American Board of Internal Medicine, or the Less Is More initiative from JAMA Internal Medicine. These two sites contain many articles questioning the value of widely used treatments and drugs.

ICER describes its role as offering “evidence-based assessments” to “help level-set prices, so Americans pay fairly for good care and don’t overpay for treatments with only a small benefit.” ICER held a Dec. 3 webinar to discuss its first annual “Barriers to Fair Access” assessment of insurers’ policies on covering prescription drugs. Slides for the webinar can be found here: Fair Access: Coverage Policies in 2020 – ICER

Trade Groups: AHIP and AMA
Two trade groups at odds on the issue of prior authorization, America’s Health Insurance Plans and the American Medical Association, each have websites with information on this issue. They are worth a look.

AHIP’s website on prior authorization defines it as “one of the many tools health insurance providers use to promote safe, timely, evidence-based, affordable, and efficient care.” It acknowledges that the process can be burdensome and goes on to discuss key findings from its Fast PATH initiative.

AMA’s website on prior authorization offers resources, including research, “to support reform, improve practice efficiency and provide data to highlight the need for change.” The AMA also  has posted online a chart that outlines steps that state governments have taken regarding prior authorization.

The AMA published an article about a recent move in Texas to provide doctors with “gold cards” in terms of prior authorization. AMA described this statewide program, which took effect in September, as the first of its kind in the United States. Physicians who have a 90% prior authorization approval rate over a six-month period on certain services will be exempt—or “gold carded”—from prior authorization requirements for those services, AMA reports.

Key academic papers to read on this topic include:

Administrative Burden and Costs of Prior Authorizations in a Dermatology Department
Ryan P. Carlisle, Nicholas D. Flint, Zachary H. Hopkins, Mark J. Eliason, Kristina C. Duffin and Aaron M. Secrest, JAMA Dermatology, August 2020.

Changing the Game of Prior Authorization: The Patient Perspective
Martha E. Gaines, Austin D. Auleta and Donald M. Berwick. JAMA, Feb. 3, 2020.
This Viewpoint article examines concerns about insurers’ ​​reversing their prior authorization approvals after people have undergone treatment. The authors call for new rules that make insurers’ prior authorization decisions binding.

Paradox of Prior Authorization: How Do We Get Value?
Lee Newcomer. Journal of Oncology Practice, June 15 2018.

Presumed benefit: lessons from the American experience with marrow transplantation for breast cancer
H Gilbert Welch and Juliana Mogielnicki, BMJ, May 2002.

Prior authorization as a utilization management tool for elective superficial venous procedures results in high administrative cost and low efficacy in reducing utilization
Victoria Lee, Todd Berland, Glenn Jacobowitz, Caron Rockman, Mikel Sadek, Michael Barfield, Neal Cayne and Thomas S Maldonado, Journal of Vascular Surgery: Venous and Lymphatic Disorders,  May 2020.

Refocusing Medication Prior Authorization on Its Intended Purpose
Jack S. Resneck Jr, JAMA, Feb. 3, 2020.

Streamlining and Reimagining Prior Authorization Under Value-Based Contracts: A Call to Action From the Value in Healthcare Initiative’s Prior Authorization Learning Collaborative. Mitchell A Psotka, Elizabeth A Singletary, William K Bleser, Rachel A Roiland, Marianne Hamilton Lopez, Robert S Saunders, Tracy Y Wang, Mark B McClellan, Nancy Brown,  American Heart Association Prior Authorization Learning Collaborative. Circulation: Cardiovascular Quality and Outcomes, July 2020.
This paper outlines options for streamlining prior authorization, such as “gold carding” and electronic and automated prior authorization processes.

Treatment Delays Associated With Prior Authorization for Infusible Medications: A Cohort Study
Zachary S Wallace, Tyler Harkness, Xiaoqing, John H Stone, Hyon K Choi, Rochelle P. Walensky. Arthritis Care & Research, November 2020.

Regional Disparities in Qualified Health Plans’ Prior Authorization Requirements for HIV Pre-exposure Prophylaxis in the United States
Kathleen A. McManus, Samuel Powers, Amy Killelea,  Sebastian Tello-Trillo and Elizabeth Rogawski McQuade.
JAMA Network Open. June 2020.

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