The Changing Reality of DME Prior Authorization in 2024

Struggling with your DME prior authorization? You are not alone in this.

There is no doubt that prior authorization, or PA in short, has been a controversial issue in the healthcare industry for years now. Causing concerns for both physicians and patients, obtaining prior authorization is quite a stressful job. Even though in 2023 significant developments and opinions surrounding pre-certification has come to light, dealing with pre-authorization in 2024 is still a time-consuming affair. Though there are continuous efforts for amelioration, we see practices and many DME providers still struggling to achieve a seamless DME prior authorization experience.

Noteworthy Prior Auth Statistics

• Delays and Administrative Burden – According to a survey conducted by the American Medical Association (AMA), a staggering 94% of physicians reported that prior authorization processes led to delays in patient care and increased administrative burden. This is an alarming issue that affects the efficiency of healthcare delivery.
• Time Devoted to PA – In 2022, the same survey found that 39% of physicians spent one to nine hours per week on prior authorization alone. This significant amount of time detracts from direct patient care, causing frustration among healthcare providers.

PA Actions by Health Systems and Insurers

• Health Systems Canceling Contracts – Last year, eight major U.S. health systems have taken the bold step of canceling their Medicare Advantage (MA) contracts. They have cited low reimbursement rates and the hassles associated with prior authorization as primary reasons for this decision. This move underscores the impact of PA on healthcare providers.
• Humana Eases PA for Cataract Surgery – Humana has made a notable change by rolling back a prior authorization requirement for cataract surgery for Medicare Advantage beneficiaries in Georgia. This is a significant step toward streamlining the process.
• Cigna and Blue Cross Blue Shield’s Efforts – Cigna Healthcare has removed nearly 25% of medical services from prior authorization requirements, eliminating more than 600 procedures. Additionally, Blue Cross Blue Shield of Michigan announced a new initiative aimed at reducing prior authorization requirements by 20%. These actions are in line with the broader goal of improving healthcare quality and access while reducing administrative tasks.
• UnitedHealthcare’s Phased Approach – UnitedHealthcare has embarked on a two-phased approach to eliminate prior authorization requirements for several procedure codes, with the aim of reducing PA by 20%. This indicates a growing recognition of the need for change within the industry.

PA Legislation Actions by States:

• California’s Bold Move – The California legislature is considering a bill that would prohibit prior authorization for any healthcare service if the plan or insurer had approved not less than 90% of the pre authorization requests a provider submitted in the most recent completed one-year contracted period. This could signal a significant shift in how PA is regulated.
• Michigan’s Reforms – Michigan has taken action to streamline PA processes by launching new rules in June, with the goal of making the system faster, more effective, and transparent. These reforms aim to benefit both healthcare providers and patients.

Prior Authorization Regulations of 2024

Lawmakers at both state and federal levels are increasingly recognizing the harm that prior authorization causes to patients and the time it takes away from physicians. In response, nine states and the District of Columbia passed legislation in 2023 to reform the prior authorization process, and this momentum continues in 2024. To learn more on the new rules – 

The AMA is actively advocating for physicians, achieving significant wins. Notably, a CMS final rule in January is expected to save physician practices $15 billion over ten years by streamlining the process electronically.

States have introduced over 90 bills this year, many based on the AMA’s model legislation, which include reforms like reducing response times for prior authorization requests, ensuring qualified physicians make adverse determinations, and prohibiting retroactive denials.

New Jersey, Washington, D.C., and Tennessee recently enacted comprehensive prior authorization reform laws. Tennessee’s law, effective in 2025, improves clinical criteria, transparency, and administrative efficiency, ensuring initial approvals cannot later be denied and mandating the use of nationally recognized standards.

Other states, including Arkansas, Texas, and West Virginia, have also updated laws or passed new ones addressing prior authorization issues. For instance, Texas now limits prior authorization requirements for certain prescription drugs to once annually.

Also, at the 2024 AMA Annual Meeting, the AMA mandated detailed denial letters and supported real time benefit tools to reduce denials and improve patient care. To address confusion that can arise from prior authorization denial letters, the AMA House of Delegates adopted policy to work with payers and more. What to know more on the AMA supports and its regulations. 

Not to forget, the American Medical Association (AMA) and bipartisan Congressional leaders are advocating for the “Improving Seniors’ Timely Access to Care Act,” introduced by Rep. Suzan DelBene (D-Washington), to modernize prior authorization in Medicare Advantage (MA). Sponsored by 130 House members and 42 Senators, the bill aims for a number of significant modifications. 

As you know, the landscape of prior authorization is quite complex and constantly evolving. It can not only be confusing, but also prone to errors, delays and low reimbursements. To ease the difficulties associated with DME prior authorization and implement an efficient and transparent experience, it is best to have a professional and knowledgeable operational extension taking care of your authorization complications constantly by your side. A great match can be found in Sunknowledge Services Inc., a reputed RCM organization known for closing authorization gaps not only faster but also efficiently. Providing effective ways to strike a balance between administrative efficiency and quality patient care, while getting your prior authorizations done effortlessly, we ensures 100 % submission of all PA requests the same day. Increasing the authorization rate by 1.5-2x and shrinking operational cost by 80 %, our expert further ensures an accuracy of over 99%!

With so many guidelines to follow and so much stress and confusion, having an operational partner like Sunknowledge plays a crucial role in streamlining your authorization operations, ensuring a seamless DME billing operation and shaping the future of healthcare delivery. Offering you a complete RCM, eligibility verification, prior auth, claims management solution and more at a cost effective rate, Sunknowledge today is known for producing the highest productivity metrics without compromising on the billing standard or productivity. So if you are looking to make a difference in your DME billing and prior authorization, we are your one stop solution for all.