Speaker 1 (00:05):

Welcome to Hospitals In Focus from the Federation of American Hospitals. Here’s your host, Chip Kahn.

Chip Kahn (00:14):

Prior authorization related to Medicare Advantage Plans is becoming a major stumbling block in patient care. Recently, it’s led to congressional calls for reform and new proposed rules from CMS. These actions are being driven by countless horror stories about how insurers intentionally drag out appeals or even use AI to deny claims which can, in some cases, result in patients dying while waiting for care. Medicare Advantage can seem very appealing to seniors looking for no or lower cost healthcare coverage. But when a doctor orders a certain test or procedure, are they going to get what Medicare covers or will that care be denied or delayed?

(00:58):

Recently, the American Medical Association released the results of a physician survey which showed a vast majority of physicians say authorization controls lead to unnecessary waste and avoidable patient harm. While health insurers continue to claim prior authorization requirements provide cost and quality controls, physician experience is quite to the contrary.

(01:21):

Joining me today to talk about prior authorization and the results of a survey is Todd Askew, Senior Vice President of Advocacy for the AMA. He oversees the organization’s legislative, government affairs, political health policy, and private sector advocacy activities. Thanks so much for joining us today, Todd.

Todd Askew (01:41):

Thanks for having me, Chip.

Chip Kahn (01:42):

Todd, just to get started, for our audience, I’m sure all of us at open season for Medicare Advantage has seen Joe Namath on television selling Medicare Advantage, can you just at least give us the top line difference between Medicare Advantage and traditional FIFA service Medicare?

Todd Askew (01:59):

Sure. Chip. I think the best way to think about Medicare Advantage is it’s privatized Medicare. It’s run by commercial health insurance companies. It’s an alternative to the traditional government-run program. Medicare Advantage is insurance companies get capitated payments for each beneficiary they cover and then they utilize various tools to help manage that care. Right now, it started off small, but over the last 20 years, now about 50% of all Medicare beneficiaries choose a Medicare Advantage Plan. 

Chip Kahn (02:30): 

So what insurers do is very, very significant for Medicare beneficiaries. And one of the techniques they use that I mentioned in my intro is prior authorization. Could you give me an explanation of what prior authorization is, what it’s supposed to do, what it seems to be doing in terms of patient care? 

Todd Askew (02:49): 

Sure. Prior authorization is one form of utilization management employed by insurance companies, including Medicare Advantage plans. During the 1990s and early 2000s, prior authorization, or PA measures, were really mostly directed to limit the utilization of high cost drugs, where payers may have felt that high cost therapy did not offer a particular significant benefit over lower cost therapies. So prior to prescribing the drug or other treatment, the physician needs to contact the payer for authorization, for prior authorization, usually by providing documentation about the patient’s healthcare condition and the reason for selecting a particular therapy. 

(03:32): 

Increasingly, though, that over the last 20 years, we have really seen an exponential growth in the application of prior authorization. Right now, today it’s used by essentially all Medicare advantage plans. And unlike clinic was originally introduced, it’s not really limited to expensive treatments or those with cheaper alternatives, but it’s even being used in cases where, for example, an established generic drug that has no other low cost alternatives, we’re seeing prior authorization in instances like that. 

(04:06): 

Now, the plans, I think, would argue that those efforts, as you mentioned in your opening, are aimed at reducing low value care and making sure that physicians are following guidelines, following the best evidence. But the manner in which it is carried out today has introduced a lot of friction into the healthcare system, multiple levels of appeals, the use of fax machines, even long delays from provider’s offices before they can actually speak to a clinician about a particular case, and results in a lot of frustration for physicians. It results in delays in care for patients. Frequently, the abandonment of care. And not infrequently, unfortunately, we are seeing in adverse health outcomes because of the delays associated with PA. 

Chip Kahn (04:52): 

So I know, Todd, that you all have done a survey of physicians to quantify and also get some qualitative sense for what the effect of prior authorization is on their patients and on the physician patient relationship. Can you give us some idea as to what the effects are that you found in the survey and maybe give us some numbers? 

Todd Askew (05:15): 

Sure. It’s really quite startling. AMA has conducted this survey for the last several years, and we have only seen movement in the wrong direction in terms of prior authorization. This most recent survey shows that 94% of physicians we surveyed, it was just over a thousand physicians reported that prior authorization has called delays in access to necessary care. And 89% of physicians has said that it has had a negative outcome for some of their patients. So the numbers are pretty quite startling. And a lot of it, it’s hard to make sense of. 

(05:47): 

For example, the payer community claims that essentially 100% of prioritization programs are based on clinical guidelines. But when we spoke to physicians about it, almost a third of physicians said that the guidelines rarely, if ever, appear to be the basis for some of the requirements and hoops they have to jump through. And it’s hard to even find out because these programs are not very transparent. It’s really quite difficult to see what the basis is. And so, we do know that 80% of physicians, over 80%, have reported adverse determinations have resulted in the abandonment of care. And most concerning, I think, is 33% of physicians have reported that prior authorization has led to a serious adverse event for a patient in their care, including hospitalization, other life-threatening events, disability, or in some cases even death. 

Chip Kahn (06:39): 

Well, Todd, that’s just such a compelling answer and disturbing. Is there anything patients can do to protect themselves in this environment that you’re describing? 

Todd Askew (06:49): 

Well, I think certainly understand your rights under the plan and the options you have under your coverage, but also work with your physician’s office because their physician’s office is really the advocate for the patient here. They are the ones that are fighting to get these things true. That’s why a third of physician offices have staff dedicated just to doing these prior authorizations, but these systems are really opaque. Usually, the first person that physician’s office gets through to at the plan is someone on at call center that has no medical training, who’s just reading an algorithm off a computer screen. And it could take days, many days sometimes for a physician to actually get through to a physician at the plan and explain the care that that patient needs and why they’ve selected this course of treatment. 

(07:34): 

And what we do know from recent studies is that when that appeal is initiated and carried through, 82% of the time, the initial denial will be fully or partially overturned. And so, that raises serious questions about the appropriateness of the denials in the first place. So the best advice I have is work with your physician’s office. They’re going to be your advocate here. 

Chip Kahn (07:58): 

It’s frustrating what you’re describing for physicians, I’m sure, from your findings, because this is supposed to save money. That’s why the insurance companies undertake it. And you’ve touched on it, but maybe we should dig a little deeper in terms of this costly administrative burden. And you’ve touched on it, but let’s review, what’s the real world impact on the patients and physicians at the front line of this administrative burden you’re describing? 

Todd Askew (08:25): 

Well, beyond the fact that care delayed is often care denied, that there’s a feeling sometimes if a payer will slow walk a patient through the process, a lot of cases, in fact, great number of cases, it does end up in the initial request for treatment being abandoned. But the physician offices, the healthcare system has to put so many resources into this process for sometimes it seems like no reason. The average physician, according to our survey, the average physician’s office sees 45 prior authorization requirements per week per physician. And that essentially takes up almost two full days of staff time per physician, not the physician time, but the support staff mostly, to process and to go through the process of filling out these prior authorizations and appealing the denials. 

(09:13): 

And as I just mentioned, a third of physicians’ offices have staff that all they do is work on prior authorization. That’s their entire function in the healthcare system. They’re not providing patient care. They’re not doing anything else. They are just working on prior authorizations. And so, it can drive up the cost of care, not only by increasing the expenses for physicians, but it can also drive up the cost of care for things like requiring an initial course of treatment that the physician is already determined is not appropriate or probably not likely to be effective. But you have to go through that initial course of treatment in order to get approval for the next step. That’s called step therapy, where you have to fail at one before you move on to the next set of treatments. And that’s a considerable waste of time. We found it causes additional office visits because you have to come back again and again as they work through the various steps you have to go through to get your care approved. And also, unfortunately, a frequently need for urgent care or emergency care in the hospital cause of adverse health defense caused by a delay or denial of care. 

(10:15): 

And so, it has got a lot of cost for the system, not only an investment in the process, but also the cost of the negative outcomes for the patients. And it’s a real burden, and it’s a real driver of burnout in our healthcare system too. 

Chip Kahn (10:30): 

I know AMA and then obviously your hospital partners have undertaken a lot of efforts to try to fix this to move us beyond this current prior authorization system. Let me give you an opportunity to mention prior authorization utilization management reform principles you think are important. And I know there’s an effort called fixpriorauth.org that you might want to mention too. 

Todd Askew (10:56): 

Oh, yeah. Thanks, Chip. A number of years ago, the physician community, the AMA, a lot of other physician organizations came together with some pharmacist groups and some patient groups to develop a set of principles. I think there were 21 of them on prior authorization and utilization management reform. And we made a series of recommendations in a number of areas. I think there were clinical validity, continuity of care, transparency and fairness, timely access and administrative efficiency, as well as what other alternatives there might be to prior authorization. 

(11:28): 

About a year later, that process led to a consensus statement, the one you just mentioned, between the AMA and a handful of other players, as well as the principal representatives for the insurance industry, where we came together and agreed on a series of five principles that we all agreed on across all those sectors they dealt with. They were a subset of the original principles, but they included encouraging selective use of prior authorizations, being more targeted in how they’re done, a regular review and adjustments to the prior authorization requirements as the science developed, as guidelines change. We need to continue to update and review what is being required, more transparency and communication, two ways between the plans and the providers protections to promote the continuity of care, and also the use of automation. 

(12:25): 

Now, the use of automation is one that unfortunately the payer community has really grabbed onto because quite frankly, more automation can lower the cost, but it can also make it quicker and easier to deny care. And frequently, we’ll see automation means a proprietary portal that can only be used with one payer and link to just, you can’t be linked to the HR. So it’s not more efficient for the physician or their staff who has to manually input the data into these portals. But regardless, there was some progress, there was some acknowledgement on both sides of this issue, that there is room for improvement. And so, it’s been slow, but we are hopeful as we continue to see momentum gain and additional efforts to address prior authorization problems. 

(13:13): 

And you mentioned also, thank you, the fixed prior off.org. It’s part of our grassroots effort where we are collecting patient and physician stories on the struggles that many people have faced trying to obtain needed care. And some of the stories, they’re heartbreaking and just completely avoidable, and others are just frustrating. There’s even one from an AMA president who had to fight with his mother’s own plan to keep her on a drug that she had been successfully been on for quite a while. So it just made no sense. It’s very frustrating, but the stories really put a face on these problems. It is not about computer algorithms guidelines, it’s about real patients and real people who have real needs. And I think it’s important to humanize this issue as we continue to look for solutions. 

Chip Kahn (14:06): 

I mentioned in my introduction to our session today, Todd, that the Congress has some bills out there on trying to reform prior authorization, and CMS has a regulation and process to look at this. Do you think that there’ll be relief from these efforts and how would you characterize these efforts? What does our audience need to know about what’s happening on the public policy side? 

Todd Askew (14:32): 

Well, I think you… I admit to two important pathways there that are currently really quite active. A lot of it has grown from the principles and the consensus statement and are reflective of that work and the broad consensus among the provider community about the need for reforms here. The legislation, the seniors timely access to care, it’s been championed by a number of people, including Representative DelBene, and the House, and Senator Marshall, and the Senate. Last year, we had over 300 co-sponsors that passed the House. We ran into a little congressional budget office scoring issue in the Senate, but it has broad support in the Senate as well. And we’re hopeful that that legislation will be back this year. I think it will be. But importantly, the administration has also taken up this cause and recognized the harm caused by prior authorization. A lot of it came out of a Office of Inspector General’s report that came out late last year that highlighted the problems in Medicare advantage with prior authorization. 

(15:33): 

And so, CMS itself, the Center for Medicare and Medicaid Service, has proposed a series of regulations with some important reforms from the principles, like requiring clear reasons for the denial of care, provision of tighter timeframes for processing those requests. And we would say they should be even tighter. We think if it’s an emergency, they should be able to turn it around within 24 hours. But it is a step in the right direction, making sure that the determination of a prioritization claim is final because we are seeing now things will be approved and the care will be provided and then they’ll come back and they’ll say essentially, “Nevermind. It’s not approved anymore.” So making sure that those determinations are final. 

(16:13): 

And also something called gold carding. There’s a federal bill on gold carding Dr. Burgess has put forward. There’s some state bills on gold carding. It essentially means if you are a provider who receives successful approval of your prior authorization request at a certain level, 90 or 95% of the time, you should essentially be given a pass, like TSA precheck. We’re not going to go through this process with you every time and let’s focus the prior authorization on the outliers who are frequently denied or frequently ordering care that’s not within the standard of care. 

(16:49): 

And so, it’s great to see CMS and Congress continuing to press on all of these issues. Like I said, we do remain hopeful. Prior authorization’s not going to go away. It’s not going to be totally done, but we can do it in a way that reduces the burden for providers that prevents harm to patients and lowers the burnout that a lot of this sometimes pointless work can cause in our healthcare system. 

Chip Kahn (17:13): 

Todd, this has just been such a useful review of all these issues that are so critical now to patient care and to the physician-patient relationship and the relationship of the physician who’s trying to provide the care frequently in hospitals. And so, I just appreciate you’re taking time for us today. And I hope our audience gets a good listen to this because we really covered the waterfront, I think, in terms of the effects of prior authorization. 

Todd Askew (17:42): 

Thank you, Chip. 

Speaker 1 (17:45): 

Thanks for listening to Hospitals In Focus from the Federation of American Hospitals. Learn more at fah.org. Follow the Federation on social media at FAH Hospitals, and follow chip at Chip Khan. Please rate, review, and subscribe to Hospitals In Focus. Join us next time for more in-depth conversations with healthcare leaders. 

Todd Askew, Senior Vice President of the Advocacy Group for the American Medical Association

Todd Askew is the Senior Vice President of the Advocacy Group for the American Medical Association, overseeing the organization’s legislative, government affairs, political, health policy and private sector advocacy activities. Prior to becoming SVP in 2019, Todd managed the AMA’s team of Congressional lobbyists as Director of Congressional Affairs, developing and implementing strategies to advance organized medicine’s priorities before the United States Congress. Todd had previously served as an Assistant Director for the division. From 1994-2000, Todd worked for the American Academy of Pediatrics Department of Federal Affairs working on legislative and regulatory matters dealing with health care financing and public health, including the 1997 enactment of the Children’s Health Insurance Program. He began his career in Washington in the office of then Representative Nathan Deal of Georgia. Todd has a BA in History from Washington and Lee University in Lexington, VA.