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AHA, BCBSA Urge CMS To Ditch ‘Conflicting’ Requirements In Prior Authorization Reform Proposal

August 9, 2023 By Jay Baldauf

Lobbying groups representing different camps of the healthcare industry have come together to urge the Centers for Medicare & Medicaid Service (CMS) to reconsider “conflicting regulatory proposals” that require different electronic standards for electronic data exchanges during prior authorization.

The American Hospital Association, the American Medical Association and the Blue Cross Blue Shield Association’s joint letter to CMS Administrator Chiquita Brooks-LaSure addresses proposed rule-making released by the agency in December 2022.

It will require payers and states to streamline prior authorization processes and improve the electronic exchange of health data by 2026, including through the use of a Fast Healthcare Interoperability Resources (FHIR) application programming interface (API) able to handle electronic prior authorization. The proposed rule also contains incentives for hospitals and physicians to adopt electronic prior authorization.

The provider and payer groups told the administrator that, while they appreciate the push to reduce administrative burden and reform prior authorization, the administration must not move forward with the proposed current prior authorization standards provisions that “create the very same costly burdens that administrative simplification seeks to alleviate.”

One proposed rule regarding electronic prior authorization information exchange (CMS-0057-P) requires federally regulated health plans to offer Health Level 7 (HL7) FHIR-based APIs, while another (the prior authorization attachment standards provisions) requires all health plans under the HIPAA regulatory pathway to use a combination of HL7 standards and the X12 standard.

“We are concerned by the conflicting provisions of these NPRMs that would establish two different sets of standards and corresponding workflows to complete the PA process, depending on the type of health plan,” the groups wrote. “Moreover, for federally regulated plans, this would require cross-walking the two standards for no discernable benefit.”

The end result, they wrote, would be “widespread industry confusion” and major expenses for plans and providers needing to implement the conflicting technologies to meet the proposed rules’ requirements.

“For these reasons, our organizations strongly advise against adoption of standards for PA attachments as proposed in this rule,” they wrote.

Hundreds of federal legislators from both sides of the aisle have pushed CMS to more quickly finalize its proposed updates to prior authorization, which, in its current form, lawmakers and other critics have characterized as a costly and overwrought administrative burden. They also called for the agency to go further and shorten delays by shortening the window for a response to an expedited prior authorization request and to include a mechanism enabling real-time decisions for routine approvals.

Lawsuit Against Insurer Claims Retaliation Against Docs for Out-of-Network Referrals

August 2, 2023 By Jay Baldauf

Health Insurance Claim Denied? See What Insurers Said Behind the Scenes — ProPublica

California’s highest court has revived a high-profile lawsuit that could have a major impact on whether insurers can punish physicians who refer patients to out-of-network providers.

The case, which has bounced around courts in the Golden State since 2012, pits the nearly 50,000-member California Medical Association (CMA) against Aetna, one of the nation’s largest health insurers. The physician group alleges that Aetna illegally retaliated against physicians who sent patients to certain out-of-network clinics.

Out-of-network providers and clinics were involved in just 4.7% of professional medical claims in 2020, according to a federal report released this month. Such claims are more likely than others to be denied, and they result in unexpected medical bills, which have led to the passage of state and federal laws that target “surprise billing.”

In a July 17 ruling, the California Supreme Court unanimously resurrected the CMA v Aetna case after a judge and a state appeals court killed it on the grounds that the CMA ― which is affiliated with the American Medical Association (AMA) ― had no standing to sue Aetna. The high state court declared that the CMA could sue on its own behalf, but the justices noted that their ruling says nothing about the merits of the case.

The ruling appears to mean that CMA’s lawsuit will head back to Superior Court in Los Angeles County. The outcome of the case won’t have a direct national effect, since the case is in state court, not federal court. However, state rulings can influence the thinking of judges elsewhere.

The case, filed in 2012, alleges that Aetna harmed patient care by harassing and sacking contract physicians who referred patients to out-of-network ambulatory surgery centers.

According to the new ruling, Aetna responded by saying that “its policy, rather than interfering in medical judgments, was designed simply to encourage participating physicians, consistent with their judgment, to use in-network care providers, such as ambulatory surgery centers, and was adopted in part in response to physicians referring patients to facilities in which they had financial interests.”

In a 2012 letter to CMA, as reported by the Los Angeles Times, an Aetna attorney went further and claimed that “physicians and their business partners secure outsized and improper windfalls at the expense of Aetna’s plan members and employer plan sponsors.”