Final MA Rule Solidifies Prior Authorization Wins

APTA

The APTA-supported provisions announced by CMS will help reduce administrative burden and ensure consistency across MA plans.

In a win for APTA and other organizations fighting to reduce administrative burden, the U.S. Centers for Medicare & Medicaid Services has put up additional guardrails on the use of prior authorization in Medicare Advantage plans. Among the provisions of the 2024 MA final rule: limits on the application of prior authorization, assurances that a prior authorization approval remains valid as long as medically necessary, and accommodations for patients in transition from one MA plan to another.

Prior Authorization Versus Preserving Continuity of Care

Taken as a whole, the prior authorization-related changes in the final rule are aimed at ensuring MA plans don't apply requirements that disrupt care. According to a CMS fact sheet, the intent is to ensure that MA enrollees receive the same services and items as beneficiaries in the Medicare fee-for-service program. Among the changes:

Prior Authorization Approvals to Remain in Effect for as Long as Necessary
In a significant shift that will place greater weight on clinician judgment, an approval of a prior authorization request for a course of treatment now must be valid for as long as medically necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient's medical history, and the treating provider's recommendation. These changes were made to the existing minimum continuity and coordination-of-care requirements.

Limits on Prior Authorization Use
The final rule limits MA plans’ ability to employ prior authorization and utilization management policies for reasons beyond confirming the presence of diagnoses or other medical criteria, or to ensure that a service or item is medically necessary. While these requirements aren't new, CMS is reminding MA plans that they need to follow them.

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APTA-Backed Legislation Would Allow for Inflation-Adjusted Fee Schedule Payment

APTA

The bill could help reverse the Medicare system's downward payment spiral. Now's the time to voice your support.

APTA and other organizations have long advocated for reform of the Medicare Physician Fee Schedule, and now Congress may be poised to take a first step to do just that: Bipartisan legislation introduced in the U.S. House of Representatives could help change the fee schedule landscape by allowing annual inflation-based updates to the flawed payment system.

The bill, H.R. 2474, proposes a straightforward change: that the conversion factor used to calculate payment for various codes be tied to the Medicare Economic Index, a calculation that accounts for inflation faced by providers relative to practice costs and general wage levels. Use of this index in the fee schedule could pave the way for providers, including PTs, to gain ground in a system that has reduced payment year over year through coding changes and the U.S. Centers for Medicare & Medicaid Services' budget neutrality requirements.

The bill was introduced by Reps. Raul Ruiz, D-Calif., Larry Bucshon, R-Ind., Ami Bera, D-Calif., and Mariannette Miller-Meeks, R-Iowa. All four are physicians.

The legislation falls squarely in line with the advocacy priorities of APTA and more than 100 other provider and patient organizations that have been pressing for an overhaul of the outmoded fee schedule system. The need for change has been recognized by many lawmakers, including 46 U.S. senators who echoed the call for reform in a November 2022 letter to Senate leadership. APTA urges members, patients, and supporters to use the APTA Patient Action Center to voice their support for H.R. 2474 to lawmakers.

Justin Elliott, APTA's vice president of government affairs, says that the fee schedule's current path is unsustainable and is creating major stresses on the U.S. health care system.

"Without an inflation-based update, the gap between frozen fee schedule payment rates and rising practice costs due to inflation will continue to widen considerably," Elliott said. "The increasing discrepancy between what it costs to run a practice and actual payment, combined with the administrative and financial burden of participating in Medicare, is contributing to provider burnout while incentivizing market consolidation, which can increase health care costs."

If passed into law, the bill would help to change course on that troubling trajectory, which has included recent cuts to the conversion factor and so-called sequestration reductions, with no potential relief in sight until 2026, when a meager 0.25% update is planned...

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