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Physician and health insurance advocacy groups are optimistic that statewide reforms for prior authorization will become law this fall. Physician and health insurance advocacy groups are optimistic that statewide reforms for prior authorization will become law this fall.

Physician, health plan advocates optimistic about prior authorization reforms

BY Sunday, August 01, 2021 05:24pm

Supporters are hopeful that a statewide bill to alter the process of doctors seeking prior authorization from insurers for patient care will become law this fall.

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Following negotiations among various parties this spring, the legislation would simplify and reform prior authorization in Michigan. Key elements in the legislation include new time limits for insurers to respond to a prior authorization request, as well as a requirement for physicians to submit requests electronically.

“Our hope is that the House will take it up this fall and we are certainly pushing for that action,” said Kevin McFatridge, chief operating officer for the Michigan State Medical Society, which has made prior authorization reforms a top legislative priority.

The Medical Society has been working through a coalition of health care advocacy groups, known as Health Can’t Wait, to push the legislation. The Medical Society recently said that enacting Senate Bill 247 would “bring new transparency, fairness and clinical validity requirements to the prior authorization processes insurers use to bog down patient care, ensuring patients throughout the state receive timely coverage decisions, and the care they need.”

The head of the trade association representing health plans in the state also believes the legislation could pass this fall after receiving widespread bipartisan support in the Senate.

“I feel very confident it will move. It’s just a matter of time,” said Dominick Pallone, executive director of the Michigan Association of Health Plans.

Resolving differences

Introduced in March and sponsored by Sen. Curt VanderWall, R-Ludington, S.B. 247 unanimously passed the state Senate on April 29. The bill now awaits a hearing in the House Health Policy Committee.

S.B. 247 initially faced opposition from health insurers that routinely use prior authorization as a check against high costs and to ensure physicians use care practices that are supported by evidence and are not ordering medically unnecessary care. The process can often frustrate physicians who claim the practice is intrusive and causes delays in patient medical care.

The two sides worked with VanderWall, who chairs the Senate Health and Human Services Committee, to amend the original draft to where “we eventually became supportive of it,” Pallone said.

“We just felt that there were some issues here that (VanderWall) was really keen on that were indeed in need of reform. Trying to make that prior authorization process better for consumers and for physicians, at the end of the day, was also in our best interests,” Pallone said. “Our focus throughout this has been on the consumer. How do we work with the Legislature on some real reform for prior authorization that the consumer has an easier process to navigate? None of our members like getting those calls from the folks that they cover that are upset at times with the prior authorization process. We felt that there was an effort on our side to make things simplified.”

A spokesperson for Blue Cross Blue Shield of Michigan said the state’s largest health insurer does not support the bill.

“Prior authorization of certain treatments is a key component to ensure patients receive safe, evidence-based care and we want to continue to do it,” spokesperson Helen Stojic wrote in an email to MiBiz.

Timeline changes

Pallone said “realistic” timelines for insurers to respond to a prior authorization request are among the new requirements in the Senate-passed bill.

Under the legislation, health insurers initially would have nine calendar days beginning Jan. 1, 2023 to grant or deny a prior authorization request for non-urgent care before it’s considered granted. That timeline would reduce to seven calendar days on Dec. 31, 2023.

Insurers would also have to grant or deny urgent care requests within 72 hours of submission.

The timelines included in the legislation would begin once a physician has submitted all of the information electronically that a health insurer needed to review a prior authorization request.

A “vast majority” of the prior authorization requests that are denied are because “not enough information has been submitted by the provider requesting it,” Pallone said.

The new timelines “fell at a place where we thought health plans could get to, and some plans may have already been there for that kind of turnaround on prior authorization,” Pallone said. “The timelines are realistic and can be achieved by health plans without them having to make millions of dollars worth of I.T. investments in order to do it.”

S.B. 247 would also require physicians to submit prior authorization requests to insurers electronically in a standardized format that should speed up the process and “be extremely helpful for everybody,” Pallone said.

Grand Rapids-based Priority Health recently launched an online portal to make the prior authorization process easier for physicians. The electronic portal that Reston, Va.-based Altruista Health Inc. designed for Priority Health automates the process, providing physicians a quicker response on whether a patient’s procedure, diagnostic test, hospital admission or medical equipment is covered.

S.B. 247 would also require health insurers to base prior authorization requirements on “peer-reviewed clinical criteria,” and to post new requirements for medical care on their website 60 days in advance, and 45 days for a prescription medication.

Licensed health professionals would review appeals of denials, and insurers would have to annually report aggregated data on prior authorization requests to the Michigan Department of Health and Human Services.

The data must include how many prior authorization requests an insurer received in a year, the number of denials and appeals, and the number of requests that were reversed on appeal. Insurers also would have to report the top 10 medical services denied and the reasons for denial.

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