2 proposed rules seek to stem insurers’ use of prior authorization, medical management

In its waning days, the Biden administration hopes to lay additional groundwork for curbing health plan policies regarding prior authorization in Medicare Advantage (MA), along with group health plan tactics that may interfere with access to certain preventive items and services.

MA prior authorization criteria

A proposed rule implementing 2026 policy and technical changes for MA and Medicare Part D was released before Thanksgiving as a prepublication draft and includes extensive language on prior authorization.

The provisions are intended to build on 2024 regulations keeping health plans from incorporating internal coverage criteria that amount to excessive utilization management, while regulations already in place for 2026 will limit prior authorization timelines.

The proposed rule sharpens the definition of internal coverage criteria to reflect any medical-necessity guidelines that are developed by either an MA health plan or a third party and are not expressly put forth in Medicare statutes, regulations or coverage determinations, or in CMS manuals.

“This includes any coverage policies that restrict access to or payment for medically necessary Part A or Part B items or services based on the duration or frequency, setting or level of care, or clinical effectiveness,” the rule states.

MA health plans would be required to publicize internal coverage criteria on their websites, including a summary of the evidence that helped develop each criterion and an explanation of the rationale behind each.

Circumstances that spurred CMS to act in the new rule include the finding that 80% of claim denials are overturned on appeal, but only a small share of denials are ever appealed.

“We have strengthened our audit processes and will consider new compliance and reporting activities to examine MA [health plan] compliance with these proposed rules,” the agency added, although it remains to be seen whether that general approach will remain in place under the incoming Trump administration.

Specifically, the rule states that CMS will collect detailed information on initial coverage decisions and appeals to get a better sense of utilization-management practices.

Curtailing inpatient admission reviews

Other language in the proposed rule is meant to enhance enrollee protections for services provided in inpatient settings.

Among those steps is a change that would restrict MA plans from reopening an approved prior authorization for an inpatient admission. The proposal states that “any additional clinical information obtained after the initial [health plan] determination cannot be used as new and material evidence to establish good cause for reopening the determination.”

The rationale for the provision is that clinical information obtained after the initial determination “cannot have the effect of creating a good-cause reopening because the determination was made based on what was known by the physician and documented in the medical record at the time of admission.”

A reopening can still take place if a review of the original evidence suggests an obvious error was made, however.

Other proposals to address coverage determinations by MA health plans include:

• Solidifying an existing regulation that if an enrollee has no further payment liability for covered services, a determination regarding the services is not subject to CMS’s administrative appeal process
• Clarifying that level-of-care and other coverage decisions made during concurrent reviews are subject to appeal
• Ensuring that providers receive notice of a coverage decision after filing a determination request on behalf of an enrollee

Comments on the rule are due by Jan. 27.

Shoring up coverage of preventive services

The proposed rule aimed at commercial insurers was drafted to ensure medical management techniques do not interfere with enrollees’ cost-free access to items such as over-the-counter contraceptive products and pre-exposure prophylaxis (PrEP) for HIV.

“A plan or issuer would be required to defer to the determination of an individual’s attending provider regarding medical necessity with respect to the individual,” the Oct. 28 proposed rule states, while noting that conscience-related exceptions remain in place.

Although comments on the rule are due by Dec. 27, giving the current administration time to write the final rule and submit it for publication, even the finalized regulatory language would be considered vulnerable to repeal by the Trump administration.

More broadly, the next administration could strategically respond to court rulings in litigation seeking to thwart mandatory full coverage of preventive services, including PrEP, that are recommended by the U.S. Preventive Services Task Force (USPSTF). In a decision issued earlier this year in the Braidwood v. Becerra case, the U.S. Court of Appeals for the Fifth Circuit chose to block the mandate only for the plaintiffs rather than nationwide.

However, legal experts have said the Trump administration could use the ruling as a basis to refrain from enforcing Affordable Care Act coverage requirements for USPSTF-recommended services. The administration also could decline to defend the preventive-services mandate before the Supreme Court, which is considering whether to grant the Biden administration’s petition to hear the case and affirm the validity of USPSTF decisions.

Furthermore, the Fifth Circuit left open the legal question of whether full coverage can be required for services recommended by the Health Resources and Services Administration (HRSA) and the CDC’s Advisory Committee on Immunization Practices. HRSA’s recommendations include access to FDA-approved contraceptives.