Pre – authorization?

Let me see if I have this right, instant decisions required for services that are typically approved anyway-no added cost, but over ten years there will be $16.2 billion in added costs. How can that be? Is there an anticipation that going forward many services not typically approved will now be approved as the result of an electronic system? It’s curiouser and curiouser.

Just imagine if such a system was extended to the private sector?

What You Need to Know

  • H.R. 3173 would create an electronic preauthorization process and could lead to instant approvals for some procedures.
  • Insurance industry groups have supported the bill.
  • The bill has had strong bipartisan support in both the House and the Senate.

Members of the House today passed H.R. 3173 — the Improving Seniors’ Timely Access to Care Act — by a voice vote.

The bill would change the rules Medicare Advantage plans use when determining ahead of time whether they will pay for a course of care recommended by a patient’s physician.

Both H.R. 3173 and the Senate companion bill, S. 3018, have had strong support from both Democrats and Republicans.

But Rep. Kevin Brady, R-Texas, who is the highest-ranking Republican on the House Ways and Means Committee, which shapes federal spending, today warned in a statement that he has concerns about a Congressional Budget Office estimate that the rule changes could cost $16.2 billion over 10 years.

What It Means

H.R. 3173 could become law, but the House voice vote approving it does not mean that final passage through Congress is a sure thing.

The Background

The Medicare Advantage program gives private insurers a way to offer Medicare enrollees coverage that looks more like ordinary commercial health coverage, and less like original Medicare coverage, which was developed more than 50 years ago and has elaborate rules for sharing costs with the enrollees.

In an effort to improve the quality of care and reduce unnecessary use of care, Medicare Advantage plans often use preauthorization programs and other rules and programs to see whether the requested drugs, procedures and other forms of care proposed appear to make sense.

Doctors have argued that, in practice, many of the preauthorization programs are slow, intrusive and demeaning, and may require them to explain their recommendations to care review workers who know nothing about the doctors’ fields of practice.

Rep. Suzan DelBene, D-Wash., introduced H.R. 3173, the House Medicare Advantage preauthorization rule change bill, in May 2021. It has 189 Democratic co-sponsors and 134 Republican co-sponsors.

Sen. Roger Marshall, R-Kansas, introduced the Senate version, S. 3018, in October 2021. That bill now has 21 Democratic co-sponsors and 21 Republican co-sponsors.

Both bills would require Medicare Advantage plans to adopt electronic prior authorization systems that meet federal standards, provide instant decisions for items and services that are typically approved and publish preauthorization program performance data every year.

The sponsors have won support from insurance organizations, such as the Better Medicare Alliance and America’s Health Insurance Plans, as well as from patient and health care provider groups.

SOURCE: ThinkAdvisor


  1. How many different “systems” are we talking about? How many different Medicare Advantage plans are there in the US? All those different interpretations of the requirements will add more complexity to the already confusing variations of Medicare Advantage plans.
    Does the prior authorization also require that the billing price be given with the authorization? How much harder will it be to appeal a denial?


  2. What is the breakdown in 16B costs over 10 years? Is it only the computer system development/data reporting requirements or will there be more healthcare services as a result? My understanding is many denials are actually Medicare covered services but human error using manual processes caused them to appear to be an uncovered procedure.
    There seems to be a lot of support from Democrats and Republicans and from doctors. Patients are being harmed by denials and lengthy appeals processes. Thankfully I have original Medicare and no longer have to deal with it. I once had to when I was employed and had Blue Cross insurance. At the end of my pregnancy , all my claims were denied. A coding error created a situation that said I had “unapproved “in vitro fertilization treatments to get pregnant so everything was denied, including the Csection. In fact I never even had IVF!! Or ever requested it. My appeal went through pretty quickly though.


  3. My first thought on this is that there will be more things that do not require pre-approval. No big deal. You do not need to maintain a new electronic system for that. Those items that are not common will require pre-approval still. So my guess is that it will cost an additional $16.2 billion to design and implement the computer software to do the same thing that is already being done by each insurance company provider. It seems like IT people will make money off of this and not save any money.

    If they want to save money, move to an electronic chip on your Medicare or insurance card that will have all your records. Why do I have to fill out the same forms everywhere I go?


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