CMS explores limiting insurers’ use of prior authorizations

Modern Healthcare – Tuesday, April 29, 2025
By Rachel Cohrs Zhang

Leaders at the Centers for Medicare and Medicaid Services are exploring proposals to limit health insurers’ use of tactics that can delay medical care, people familiar with the discussions said.

The aim of the proposals would be to cut the number of medical procedures subject to “prior authorization,” meaning ones in which doctors have to fill out additional paperwork for ultimate approval. CMS is exploring making policies more uniform across different health insurance plans.

Another goal is automating coverage determinations so patients can get decisions faster, said the people, who weren’t authorized to speak publicly on the matter. The discussions are in preliminary stages, and the agency’s direction could change.

The process of obtaining prior approvals for insurance coverage can be time-consuming, involving denials of physician-recommended services that patients then have to fight. Public anger over health insurance practices boiled over following the killing of UnitedHealth Group Inc. executive Brian Thompson in December. Ammunition found near Thompson’s body bore the words “delay,” “denied” and “depose,” mimicking a phrase used by insurance industry critics. Neither Congress nor health regulators have taken action on the issue since.

CMS spokesperson Catherine Howden said in a written statement that the agency is “committed to cutting down on unnecessary delays” for seniors seeking medical care.

“The agency will consider all options to streamline the care delivery process, however any statements about a specific set of principles or decisions are premature at this point,” Howden said.

It’s unclear whether the agency would pursue regulations to require changes to insurance plans or whether they’d attempt to make the changes through voluntary adoption by health insurers.

Former CMS acting administrator Andy Slavitt, who has talked with agency leadership about the policy, said he recommended an approach that involved new regulations, rather than voluntary cooperation.

“CMS has an opportunity to lead the way,” Slavitt said in an interview with Bloomberg.

During his Senate confirmation hearing, the now-head of CMS Mehmet Oz said there were thousands of procedures that go through prior authorization, and that there should be immediate communication with physicians and patients about what the requirements would be to secure approval. Oz also said during the hearing that artificial intelligence could “play a vital role” in this.

He suggest that could cut a percentage of administrative costs and appease Americans’ “intense” frustration with the system.

A spokesperson for UnitedHealth Group didn’t immediately respond to a request for comment about the discussions. UnitedHealth’s leaders told Bloomberg earlier this year that the company is working on speeding up decisions like these and reducing the number of services subject to those hurdles.

The company has said it’s reduced the number of services subject to prior approval in Medicare by 40% since 2016.

Tim Noel, chief executive officer of the UnitedHealthcare insurance unit, said the industry could still further reduce the number of services subject to prior approval and “really focus on things that have patient safety and quality concerns.”

The Better Medicare Alliance, which represents members including Medicare Advantage insurers, said the group has supported transitioning prior authorizations to electronic processes.

“Prior authorization helps keep healthcare costs low and ensures seniors are getting the best care. But it should be easier for seniors and providers,” the group’s president and CEO Mary Beth Donahue said in a written statement.

AHIP, a group that represents health insurers, said it looks forward to working with policymakers to improve the processes “to ensure patients receive safe, evidence-based care while reducing low-value and inappropriate services so coverage is as affordable as possible,” spokesperson Chris Bond said.

The American Medical Association, which has advocated for limits on prior authorizations, commended the sense of urgency Oz has demonstrated on the issue.

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