Prior Authorization Reform: How Michigan’s Health Can’t Wait Coalition is Leading the Charge
March 12, 2023
It’s no secret that providers and patients are frustrated with prior authorizations. Prior authorization (PA), or pre-certification, is a process that insurance companies use to determine if a medical service or treatment the right course of action at this time based on the diagnosis. The process requires healthcare providers to obtain approval from the patient’s insurance company before performing certain medical procedures, medications, and tests. Although intended to ensure patients receive appropriate care, it can also create significant delays and administrative burdens for healthcare providers.
However, one state has successfully found a solution and is leading the charge in PA reform. Michigan has taken significant steps to help healthcare providers (and patients) by creating the Health Can’t Wait initiative, which the Michigan State Medical Society spearheaded. Here’s an overview of Michigan’s Health Can’t Wait initiative and its impact on providers and patients.
The Genesis of Michigan’s Health Can’t Wait Initiative
The Health Can’t Wait initiative was created to address the issues that Michigan providers faced regarding prior authorization. At the center is the concern that prior authorization delays are dangerously impacting patient care. Patients may have to wait days or weeks for insurance companies to approve a service or medication, which can be particularly problematic for those with acute or chronic conditions requiring timely intervention.
Based on a 2021 AMA (American Medical Association) prior authorization physician survey:
93% of physicians report care delays due to prior authorization red tape
91% say prior authorization requirements negatively impact patient clinical outcomes
82% percent of physicians report that prior authorization can sometimes or often lead to a patient abandoning treatment
34% reported that it has led to a serious adverse event for a patient in their care
For healthcare providers, prior authorization requires submitting extensive documentation to insurance companies to support the medical necessity of a service or treatment, which can take valuable time away from patient care. In addition, in some cases, insurance companies may deny coverage for a service or treatment that the provider believes is medically necessary, which can lead to additional administrative work and appeals.
Thankfully, the Health Can’t Wait coalition is working to make things better. By bringing together patients, healthcare providers, and associations, the group has been advocating for the reduction of administrative burdens on providers to help improve patient care. The coalition was instrumental in passing legislation that aims to improve the prior authorization process.
What the Legislation Entails
The legislation passed in Michigan requires health insurance companies to use a standardized electronic prior authorization process and establish a system for tracking and reporting prior authorization data. The law also sets specific time frames for completing prior authorization requests, including a 72-hour time limit for urgent requests and a seven-day time limit for non-urgent requests, before they are considered granted.
Although the legislation was passed in 2022, its anticipated changes are not expected to start taking effect until this summer.
Payers will be required to report on the effectiveness of the prior authorization process beginning on June 1, 2023. This reporting requirement will provide valuable information on the new legislation’s impact and allow for further adjustments to improve the process.
The Impact of the New Legislation
The goal of this new legislation is to reduce the administrative burden of prior authorizations on healthcare providers and to ensure timely access to necessary medical services for patients. The law has been widely welcomed by Michigan providers, who hope it will lead to better patient outcomes.
For healthcare providers, prior authorization reform would not only free up more time to focus on patient care, but it could also reduce the number of denials and appeals. Additionally, providers would benefit from increased transparency around the prior authorization process since insurance companies would be required to provide more information about their criteria for medical necessity and would have to respond to requests within set timeframes. This would allow providers to make more informed decisions about treatment options and reduce the uncertainty and delays that can come with the current prior authorization process.
The Health Can’t Wait initiative and the legislation passed in Michigan have shown a commitment to improving the patient experience and reducing the administrative burden on healthcare providers. With the implementation of the new law, providers in Michigan hope that they will be able to provide better care to their patients and reduce delays in the prior authorization process.
The Health Can’t Wait initiative is an excellent example of how advocacy and collaboration can change the healthcare industry significantly. By working together, patients, providers, and associations can make a difference and improve the quality of care provided to patients.
Providers in other states are looking to Michigan as an example of how to improve the prior authorization process in their own states. Michigan’s Health Can’t Wait initiative is a significant step in the right direction. By reducing the administrative burden on providers, patients can receive the necessary medical services in a timely fashion, leading to better outcomes and an improved patient experience.