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AMA: CMS Final Rule Revolutionizes Prior Authorization: $15 Billion in Savings, Streamlined Processes, and Improved Patient Care

The Centers for Medicare & Medicaid Services (CMS) has released a final rule making important reforms to prior authorization to cut patient care delays and electronically streamline the process for physicians, the American Medical Association reports. Together, the changes will save physician practices an estimated $15 billion over 10 years, according to the U.S. Department of Health and Human Services (HHS).


The rule addresses prior authorization for medical services in these government-regulated health plans:

  • Medicare Advantage.

  • State Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs.

  • Medicaid managed care plans and CHIP managed care entities.

  • Qualified health plan issuers on the federally facilitated exchanges.


As a direct result of advocacy from the AMA and other physician organizations, CMS has taken significant steps toward rightsizing the prior authorization process by addressing both technological and operational requirements. The AMA is grateful that the Biden administration is prioritizing such a critical issue for patients and physicians.


“When a doctor says a patient needs a procedure, it is essential that it happens in a timely manner,” said HHS Secretary Xavier Becerra. “Too many Americans are left in limbo, waiting for approval from their insurance company.” The administration’s action, he said, “will shorten these wait times by streamlining and better digitizing the approval process.”


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