If the Government Accountability Office (GAO) has its way, Medicare's recent prior authorization programs will get a new lease on life and even expand to other items and services.
On May 21, GAO publicly released its April report, "CMS Should Take Actions to Continue Prior Authorization Efforts to Reduce Spending."
GAO refers to Medicare prior authorization demonstrations, such as the ones launched in 2012 for power mobility devices, in 2014 for non-emergent hyperbaric oxygen therapy and in 2016 for certain durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) items, home health and repetitive, scheduled, non-emergent ambulance transport.
Noting that these programs are either closed or about to close, GAO calls for the CMS Administrator to not only resume or continue them, but also to find "new opportunities for expanding prior authorization to additional items and services with high unnecessary utilization and high improper payment rates."
GAO is concerned with improper payments in the Medicare fee-for-service program overall, which it reports totaled $36.2 billion in 2017. The agency finds in this report that through March 2017 savings from the prior authorization demos "could be as high as about $1.1 billion to $1.9 billion."
GAO claims that "many of the officials we interviewed representing provider, supplier and beneficiary groups, as well as CMS and MACs, reported benefits to prior authorization" -- which is strange as regards the provider groups, considering the American Medical Association (AMA) has been wary of these programs, saying they "can create significant barriers for patients by delaying the start or continuation of necessary treatment and negatively affecting patient health outcomes," calling for more provider-friendly standards in such programs, and showing in member surveys that providers find authorizations not only inconvenient but also a menace to patient health.
Nonetheless GAO says that provider and supplier groups tell them that prior authorization gives them helpful assurance that "their claims will likely not be denied."
GAO does admit that "providers and suppliers lack assurance about whether Medicare is likely to pay" for items under prior authorization, which it finds "contrary to a CMS stated benefit of prior authorization to provide assurance about whether Medicare is likely to pay for an item or service." But they say CMS is "taking steps," including the creation of "documentation checklists, prior authorization coversheets and other tools," to make the authorizations easier to achieve,
In its response CMS has, rather non-committally, agreed to "evaluate" its programs and ways to improve them.