Report: Massachusetts Should Mandate Prior Authorization Automation

April 26, 2023
Network for Excellence in Health Innovation says that Massachusetts should pursue automation both to achieve compliance with upcoming federal rules and to alleviate the burdens and costs of current prior authorization processes

The Network for Excellence in Health Innovation (NEHI) and the Massachusetts Health Data Consortium (MHDC) have issued a report recommending that Massachusetts should take a leadership role in promoting the automation of prior authorization (PA) by creating structures and incentives that coordinate payer, provider, and vendor activities.

NEHI is a national nonprofit, nonpartisan organization composed of stakeholders from across key sectors of health and healthcare. Its Prior Authorization project work was supported with funding from the Massachusetts Health Policy Commission, Change Healthcare, Cohere Health, Hook, and ZeOmega.

The Centers for Medicare & Medicaid Services (CMS) has put out a Proposed Rule on Improving Prior Authorization. The report suggests that Massachusetts should pursue automation both to achieve compliance with the new federal rules and to alleviate the burdens and costs of current PA processes. The NEHI recommendations include guidelines for drawing an automation roadmap and the structures needed to support the coordination and expertise needed for statewide implementation. Its recommendations are designed to advance the adoption of automated PA among Massachusetts payers and providers by 2026.

Project leaders have been working with participants from across the healthcare system, which came to be known as The Automation Advisory Group (TAAG). Consisting of payers, providers, technology companies, EHR vendors, and state and federal representatives, TAAG provided feedback on existing guidelines for automation (the Da Vinci Implementation Guides [IGs]), informed by their experiences and capabilities.

The report states that the Commonwealth should use state regulatory authority to mandate automation based on a technical roadmap. “While there is much that can be accomplished without a state mandate, TAAG participants favored the adoption of a coherent requirement to proceed with automation.”

They noted that automation cannot achieve its intended benefits without the participation of different sectors of the healthcare community. “Providers and payers must both make changes in their workflows and systems to achieve expected benefits. Detailing what each sector must do to proceed with automation removes the friction that would inevitably occur among stakeholders, including vendors. In addition, a state mandate will improve the efficiency with which automation is adopted as payers, providers, and vendors travel down the same path and can take advantage of lessons learned. Finally, a state mandate will standardize the process so that providers and payers will have the same ground rules and expectations when interacting with each other, despite variation in PA requirements among payers and variations in EMRs among providers.”

The authors believe that from a political standpoint, a mandate in this area is unlikely to garner strong objections. “Promulgation of the CMS Proposed Rule strongly signals that the industry must move in this direction. A mandate consistent with the Proposed Rule as finalized simply organizes and promotes forward movement in a manner consistent with the Commonwealth’s circumstances and goals. Moreover, both stakeholders and state agencies have highlighted the need to remove waste and burden from the system considering the Commonwealth’s coverage and cost control objectives.”

In addition, through its authority to regulate hospitals and oversee physicians’ practice of medicine, the authors recommend that the state mandate adoption of those activities that will enable automation of PA requests.

When they discussed oversight of the mandate with TAAG, the authors recommended that 
the Health Policy Commission (HPC), which is charged with “monitoring health care spending growth in Massachusetts and providing data-driven policy recommendations regarding health care delivery and payment system reform,” could be an appropriate Agency within which to locate this responsibility. The Division of Insurance (DOI) or 
the Executive Office of Health and Human Services (EOHHS) might also be considered.

Legislation will be needed to address some of the responsibilities envisioned, the report says. “The state will, for example, need to obtain data from both providers and payers. In addition to monitoring progress in implementing the technical stages of automation, the recommendations include that the responsible Agency develop measures that connect to three goals as part of the automation mandate: 1) improving trust in the process by increasing
the transparency of PA functions; 2) providing information that enables an evidence base for continuing PA reforms; and 3) measuring administrative savings achieved. Data reported should be made transparent to payers, providers, and consumers in an accessible manner.”

Automation will yield standardized data elements that are useful for all stakeholders involved in the process. At a minimum, devising mandated reporting on simple metrics such as services subject to PA, PA response times, and payer rates of denials will be critical to showcase process transparency, the report says. Measures that clarify the frequency with which providers request different services subject to PA and automation adoption rates will also be important.

To ensure that all providers and payers are able to adopt the required technological and process changes that automation requires, the state should make available need-based financial assistance, especially for MassHealth and organizations that serve MassHealth members, the authors suggest. By supporting centralized technical assistance, however, the state may efficiently reduce the support required.

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