HHS, Insurers Pledge to Simply Preauthorization Processes

A dozen health insurance giants that provide coverage for about 80% of Americans with Medicare, Medicaid and commercial plans have agreed to work the U.S. Department of Health and Human Services to voluntarily streamline and improve their pre-authorization processes.

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The issue of pre-authorization for years has been a major administrative obstacle for physicians and a significant source of frustration. Health insurers are facing lawsuits for relying on artificial intelligence tools to deny claims. And those denials for potentially life-saving care can endanger patients, HHS officials said at a press briefing on Monday.

The briefing followed a roundtable HHS hosted in Washington, D.C. with insurance company executives to discuss and endorse to pre-authorization reforms. Attendees represent the nation’s largest insurers including Aetna, Blue Cross Blue Shield Association, CareFirst BlueCross BlueShield, Centene Corp., Cigna Group, Elevance Health, GuideWell, Highmark Health, Humana, Inc., Kaiser Permanente and UnitedHealthcare. Other insurers are also expected to join the pledge, HHS officials said.

The participating insurers agreed to greatly reduce the current reliance on faxes, phone calls and confusing web portals that physicians often must contend with in order to submit their pre-authorization requests and documentation.

Instead, the insurers pledged to:

• Standardize electronic pre-authorization submissions using the standard Fast Healthcare Interoperability Resources – or FHIR-based – application programming interfaces;
• Reduce the volume of medical services subject to prior authorization by Jan. 1, 2026;
• Honor existing authorizations during insurance transitions to ensure continuity of care;
• Improve transparency and communication around authorization decisions and appeals;
• Increase their real-time responses to reduce delays in care with real-time approvals for most requests by 2027;
• Ensure medical professionals review all clinical denials.

There’s been previous efforts to improve the pre-authorization practices of insurers, including in pledges made in 2018 and 2023, that did not gain momentum, Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, acknowledged.

A few things have changed since then, he said.

“There’s been violence in the streets over these issues,” he said.

While Oz did not specify the person by name, he was likely referring to the assassination-style murder last December of United HealthCare CEO Brian Thompson as he walked on a Manhattan street to attend a company conference with financial analysts.

Bullet casings found at the murder scene were scrawled by the alleged killer with the words “deny,” “delay” and “depose.” Almost immediately after news broke about Thompson’s shooting, social media exploded with a tidal wave of hostile comments about the company’s coverage denial practices – and the overall healthcare insurance industry (see: CEO’s Murder Sparks Outcry Over UHC’s Coverage Denials).

The frustrations around pre-authorizations “is not a passively accepted reality any more – Americans are upset about it,” Oz said. The goal is to have transparent and voluntary change, he said.

While the streamlining of pre-authorizations is voluntary for now, the federal government has the potential to issue mandatory rules and regulations and even legislation to codify the effort in its “back pocket,” Oz said.

“We are going to deal with this issue one way or another. We have legislation pending to codify some of these changes. But the major factor is that the industry realizes that some of the pre-authorization just don’t make any sense.”

The insurers are pledging to support a move to process pre-authorization electronically using a standardized interoperable system, with a goal of providing real-time authorization decisions, HHS Secretary Robert F. Kennedy Jr. said.

Common procedures that often still require pre-authorizations that could be immediately addressed include cataract surgery, colonoscopies and even vaginal childbirth deliveries, officials said.

AI’s Role in Healthcare Decisions

Rep. Gregory Murphy, R-N.C., one of 21 physicians currently serving in the House and Senate, said during the briefing that he hopes that the use of artificial intelligence will help in the effort to streamline pre-authorizations – but the industry needs to understand the risks.

“Artificial intelligence should help this tremendously, and it should take out a lot of the variances between doctors, hospitals and regions of the country. “But remember, artificial intelligence is only as good as what you put into it. So, if you’re artificial intelligence puts in a key to deny on basic tenants then the denial rate is going to be the same. We’ll have to see if people are actually putting into the AI things that are reasonable and medically necessary so that what’s spit out is reasonable for the patient and those who provide care.”

The use of AI for pre-authorizations has also already generated intense criticism from some quarters. For instance, UHG is among several insurers facing proposed class action lawsuits alleging their use of AI is being used to unfairly deny medically necessary care.