Massachusetts boasts some of the longest emergency room wait times in the nation. However, Gov. Maura Healey’s goal of reforming a process requiring prior authorization for some treatments could reduce patient wait times and streamline treatment.
This January, Healey directed the Division of Insurance to reform state regulations for prior authorization practices, including eliminating it for many “routine and essential” medical services.
Medical insurance companies nationwide require this authorization before approving treatment, medication or tests. If a procedure or service is performed before receiving approval, the insurer can refuse to pay. The stated purpose is to control health care costs, prevent inefficient treatments and ensure compliance with clinical guidelines.
However, many argue against the efficacy of prior authorization. Research from the American Medical Association emphasized that overuse of prior authorization by insurance companies has caused patients “real harm” as the process can delay care, limit treatment avenues and increase administrative tasks taking providers away from patients.
“These new regulations by the DOI are a major step in reducing the burden prior authorization has created and in allowing providers to spend more time doing what they are trained to do and want to do: deliver care and take care of patients,” said Sen. Cindy Friedman, D-Arlington, co-chair of the Health Care Financing Committee, in support of the policy.
A 2024 report by the Kaiser Family Foundation found that Medicare Advantage insurers fully or partially denied only 7.7% percent of 53 million requests, with 9.2% of the initial denials being overturned. Meaning that a vast majority of prior authorization requests amounted to hours of wasted time jumping through hoops for the already understaffed healthcare community.
“Prior authorization has become a huge administrative burden for providers, and it started as something that was to help ensure that the right medical services and pharmaceuticals were being used based on evidence-based information research,” said Friedman. “But it’s turned into something that is now used as a way to try and deny services or put extra hoops for providers to go through to get authorization for services that they think their patients are required. And now we need to bring it back to what it was originally meant to be.”
Under Healey’s proposal, prior authorization requirements would be eliminated for a range of services, from emergency care to treatments for chronic diseases. Insurers would be required to make publicly available the costs of all services, supplies, and medications requiring prior authorization to increase transparency. The proposal also aims to address issues within the authorization process that cause delays and administrative waste.
‘Continuity of care’
The regulations would also require insurers to provide automatic “continuity of care” authorizations for at least three months when patients switch insurance plans, helping prevent disruptions in treatment. In urgent cases where a patient’s life is at risk, insurers would be required to respond to requests within 24 hours, a change aimed in part at reducing strain on emergency rooms.
According to a DOI spokesperson, these updates are intended to reduce administrative burdens, improve patient access to needed care and are a first step to addressing the larger affordability challenges within the health care system.
Certain groups, while supportive of reforms, have voiced concerns.
In a statement released following the announcement of Healey’s proposal, Massachusetts Association of Health Plans President and CEO Lora Pellegrini emphasized a commitment to streamlining and modernizing prior authorization processes, but maintained the importance of the practice in care management.
“Prior authorization is not merely an administrative process; it is a core affordability safeguard that promotes evidence-based care, curbs unnecessary utilization, and protects patients and purchasers from avoidable costs,” Pellegrini said in the statement. “Independent analysis by Milliman finds that eliminating prior authorization in Massachusetts would increase commercial premiums by $600 to $1,500 per member annually, underscoring its essential role in maintaining affordability.”
The report by Miliman from 2023 was commissioned by MAHP, which did not respond to requests for comment.
Reforms could bring savings
In 2023, the Massachusetts Health and Hospital Association released a report outlining how insurance reforms could save the state’s healthcare system as much as $1.75 billion. A report from the same year from the Council for Affordable Quality Healthcare stated that the health care industry spent $1.3 billion on administrative costs related to prior authorization requests. Prior authorization transactions cost providers about $6 per request.
While the exact impact that Healey’s proposed policy could have on addressing the affordability and resource challenges within the state’s health care system, many are excited about the positives this change brings for patients and providers.
“These new prior authorization reforms are a tremendous step toward breaking down roadblocks that are proven to drive patient care delays, drive health care workers out of the field, and drive up costs for everyone,” said the MHA in a statement it released to the media.
A hearing on the proposed amendments to the current policy was held in February. The policy is undergoing a review and approval process before final regulations are filed with the Secretary of the Commonwealth, according to the DOI.