Traditional Medicare to add prior authorizations

The big picture: Medicare’s fee-for-service program hasn’t required prior authorizations to access most drugs or services, a major perk for enrollees.

• Prior authorization in privately run Medicare Advantage plans has become a hot-button issue for Congress and federal regulators working to rein in the practice. Federal inspectors found in 2022 that prior authorization in MA prevented some seniors from getting medically necessary care.

State of play: Medicare’s innovation center announced on Friday that it will solicit applications from companies to run the prior authorization program starting Jan. 1.

• It will apply only to providers and patients in New Jersey, Ohio, Oklahoma, Texas, Arizona and Washington.

The change will apply to 17 items and services, including skin substitutes, deep brain stimulation for Parkinson’s disease, impotence treatment and arthroscopy for knee osteoarthritis.

• CMS selected the services based on previous reports and evidence of fraud, waste and abuse, as well as what’s already subject to prior authorization in Medicare Advantage.

Zoom in: The companies hired to manage the program will be paid based on how much they save the government by stopping payments for unnecessary services.

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