New CMS Federal Rule Eases Doctor’s Administrative Load 

In a groundbreaking move aimed at decreasing doctors’ administrative burdens and enhancing patient care, the Centers for Medicare & Medicaid Services (CMS) recently introduced a federal rule that has been welcomed by physicians’ groups nationwide. According to the Prostate Cancer Foundation, the rule is expected to save $15 billion over ten years.  

The Essentials of the Rule

With a compliance date starting January 1, 2026, health insurers participating in federal programs, including Medicare Advantage and Medicaid, are now required to improve the efficiency and transparency of their prior authorization processes. Here’s a breakdown of the key aspects of the new rule:

  1. Quicker Responses
    • Health insurers are required to address expedited prior authorization requests within a 72-hour timeframe, while other requests must be responded to within 7 days.  
  2. Transparency in Denials
    • Insurers are now obligated to provide reasons for denying a prior authorization request and will be held accountable for their decisions. 
  3. Public Disclosure
    • To foster more transparency, health insurers are mandated to make data on denial and approval rates for medical treatments publicly available. 
  4. Patient Empowerment
    • By potentially reducing the increasingly larger volume of prior authorization requests and their approval time, this rule will allow patients and physicians to focus more on a patient-centric approach to healthcare.

What this Means for Private Practice Doctors  

1. More Time with Patients, Less Time Waiting for Insurers  

As dissatisfaction with health insurers continues to rise, this federal rule signifies a rising trend toward a more patient-centric approach to healthcare. Family and private practice physicians have witnessed the challenges patients encounter with insurers, prompting some to embrace direct care models to address these issues and recenter the focus on patients. According to Medical Economics, there has been a 241% growth in Direct Primary Care memberships from 2017 to 2021, and more recently, a report by SOA revealed that 70% of all Direct Primary Care practices were established within the last 4 years. At MedCoShare, we are directly witnessing this surge in adoption of direct care models, where private practice physicians are empowered to maintain their autonomy and flexibility with our shared coworking spaces and private practice support services. Many of our MedCoShare members in our Marlton, NJ, Fishtown, PA, King of Prussia, PA locations, have been at the forefront of this shift to make patient experience more personal and efficient, with 10% of providers adopting direct care models. This federal rule reflects the changing landscape of healthcare; physicians can expect expedited turnaround times for approvals and denials, which means treating patients on a quicker timeline.  

2. Transparency in Prior Authorization Requests  

Public data estimates from KFF and U.S. PIRG suggest that health insurers deny roughly 20% of in-network patient claims. Additionally, a 2022 study during a two-month period by Pro Publica revealed that, at Cigna alone, the average human review time spent on prior authorization requests was a mere 1.2 seconds. As concerns about the potential misuse of AI in healthcare and the need for regulations intensify, this federal rule imposes new requirements for the public release of information regarding denials and approvals and aims to hold insurers to higher levels of accountability. With increased transparency throughout the process, physicians can anticipate gaining more clarity as they formulate treatment plans for their patients.  

Looking Ahead

While some provisions of the rule must be implemented by January 2026, others are slated for compliance by January 2027. Lauded by physicians and endorsed by groups such as the Medical Group Management Association and the American Academy of Family Physicians, this rule represents a crucial step in alleviating administrative strain on doctors and holds promise in streamlining workflows through electronic health records integrations. As the healthcare industry evolves, this development marks a significant stride towards efficiency and patient-focused care.


Date: February 8, 2024

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