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Physicians groups on January 17 hailed a new federal rule requiring health insurers to streamline and disclose more information about their prior authorization processes, saying it will improve patient care and reduce doctors' administrative burden.

Health insurers participating in federal programs, including Medicare Advantage and Medicaid, must now respond to expedited prior authorization requests within 72 hours and other requests within 7 days under the long-awaited final rule, released on January 17 by Centers for Medicare & Medicaid Services (CMS). 

Insurers also must include their reasons for denying a prior authorization request and will be required to publicly release data on denial and approval rates for medical treatment. They'll also need to give patients more information about their decisions to deny care. Insurers must comply with some of the rule's provisions by January 2026 and others by January 2027. 

The final rule "is an important step forward" toward the Medical Group Management Association's goal of reducing the overall volume of prior authorization requests, said Anders Gilberg, the group's senior vice president for government affairs, in a statement. 

"Only then will medical groups find meaningful reprieve from these onerous, ill-intentioned administrative requirements that dangerously impede patient care," Gilberg said.

Health insurers have long lobbied against increased regulation of prior authorization, arguing that it's needed to rein in healthcare costs and prevent unnecessary treatment. 

"We appreciate CMS's announcement of enforcement discretion that will permit plans to use one standard, rather than mixing and matching, to reduce costs and speed implementation," said America's Health Insurance Plans, an insurers' lobbying group, in an unsigned statement. "However, we must remember that the CMS rule is only half the picture; the Office of the Coordinator for Health Information Technology (ONC) should swiftly require vendors to build electronic prior authorization capabilities into the electronic health record so that providers can do their part, or plans will build a bridge to nowhere." 

The rule comes as health insurers have increasingly been criticized for onerous and time-consuming prior authorization procedures that physicians say unfairly delay or deny the medical treatment that their patients need. With federal legislation to rein in prior authorization overuse at a standstill, 30 states have introduced their own bills to address the problem. Regulators and lawsuits also have called attention to insurers' increasing use of artificial intelligence and algorithms to deny claims without human review.

"Family physicians know firsthand how prior authorizations divert valuable time and resources away from direct patient care. We also know that these types of administrative requirements are driving physicians away from the workforce and worsening physician shortages," said Steven P. Furr, MD, president of the American Academy of Family Physicians, in a statement praising the new rule. 

Jesse M. Ehrenfeld, MD, MPH, president of the American Medical Association, called the final rule " a major win" for patients and physicians, adding that its requirements for health insurers to integrate their prior authorization procedures into physicians' electronic health records systems will also help make "the current time-consuming, manual workflow" more efficient.

Barbara Feder Ostrov is editorial director, Business of Medicine, for Medscape.