Patients Over Paperwork Initiative Prompts New Rule on Prior Authorization

Last Updated: Jan 20, 2021

Prior Auth 250x250The Centers for Medicare and Medicaid Services (CMS) finalized a new rule on Jan. 15, 2021 regarding the prior authorization process which builds on the concept of interoperability. The rule will become effective on Jan. 1, 2024. 

The rule will subject Medicaid, CHIP, and individual market qualified health plans on the federally facilitated exchanges to interoperability standards regarding electronic health data and information about patient’s pending and active prior authorization decisions, and sharing such data with providers and other payers as the patient moves from one payer to another.

Specifically, the rule requires plans to build, implement, and maintain application programming interfaces (APIs) using Health Level 7 (HL7) Fast Healthcare Interoperability Resources (FHIR) standard in order to support automation of the prior authorization process and advance a streamlined approach for the burdensome activity.

The rule also requires plans to issue decisions within 72 hours for urgent requests and seven calendar days for non-urgent requests, and to offer a specific reason for denial, with the goal of bringing transparency to the process.

Although Medicare Advantage plans were excluded from this rulemaking, CMS is considering inclusion in future rulemaking.

Additional Resources

CMS Press Release

CMS Final Rule

PAMED members with questions on the final rule can contact our Knowledge Center at 800-228-7823 or

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