Insurers Pledge to Fix Controversial Pre-Authorization Process

Major companies that oversee health plans, including Medicare Advantage plans, said they will reform a common practice that can result in delayed care and denied services

Tony Pugh,

AARP

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Published June 24, 2025

Pete Ryan

A group of major health insurers, including those that provide private Medicare and Medicaid managed care plans, have pledged to implement six new voluntary changes designed to streamline, standardize and reduce the burden of the “prior authorization” process, where health plans must approve certain medical services before they are performed.

The commitments of nearly 50 leading health insurers, announced June 23, are expected to help reduce administrative delays and simplify care for some 257 million individuals — about 75 percent of Americans with health coverage, said Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services (CMS), during a press briefing. Among them are nearly 35 million older Americans enrolled in Medicare Advantage plans and an estimated 75 percent of Medicaid recipients who are covered through private managed care organizations.

If fully adopted, the proposed changes could be the most sweeping industrywide effort to address complaints about prior authorization, which is designed to contain costs by reducing unnecessary care. But regulators, consumers, lawmakers and providers have raised concerns that insurers use prior authorization to save money and improperly deny care that would otherwise be provided.

Changes could reduce hurdles for those with Medicare Advantage

Much of the debate over prior authorization has centered on Medicare Advantage (MA) plans. Unlike original Medicare, which pays for each medical service provided, MA plans receive a flat monthly payment to cover each enrollee’s cost of care. They use utilization management tools, like prior authorization, to provide care more efficiently. The health policy nonprofit KFF reports that virtually all MA enrollees are required to obtain prior authorization for some services.

However, studies have found that these plans often deny care that original Medicare typically covers. This can include requests for diagnostic imaging, pain injections and the transfer of patients from hospitals to nursing homes. A KFF report found that roughly 82 percent of MA plans’ prior authorization denials were overturned on appeal in 2021.

A closer look at the proposed changes

A host of leading insurers, known as the “Industry Leadership Initiative on Prior Authorization,” have committed to six policy changes that they claim will lead to “faster, more direct access to appropriate treatments and medical services with fewer challenges navigating the health system,” said a press release from AHIP, the leading health insurance trade group.

Participating carriers that have committed to the policy changes include: Centene, the Cigna Group, CVS Health Aetna, Elevance Health, Humana, Kaiser Permanente, SCAN Health Plan, UnitedHealthCare and more than 20 Blue Cross and Blue Shield providers.

The proposed changes, scheduled to take effect in 2026 and 2027, include reducing the number of services that require pre-authorization, developing a standardized request process, and responding to at least 80 percent of pre-authorization requests “in real time.”

The insurers are also planning to honor existing prior authorization determinations when a patient changes insurance carriers during a course of treatment, and to provide clear explanations for pre-authorization determinations, including steps patients can take to appeal a decision.

“For providers, these commitments will streamline prior authorization workflows, allowing for a more efficient and transparent process overall, while ensuring evidence-based care for their patients,” the AHIP release said.

Actor Eric Dane, who starred on Grey’s Anatomy, joined health officials at the press briefing and spoke about his battle with ALS, also known as Lou Gehrig’s disease.

“Your life becomes filled with great uncertainty” when someone finds out they’re sick, Dane said. “And the worst thing that we can do is add even more uncertainty for patients and their loved ones with unnecessary prior authorization. Anything we can do to give patients more certainty with fewer delays is a worthwhile endeavor.”

Rep. Greg Murphy (R-North Carolina), who’s a physician, said that he’s glad to hear “insurance companies have now understood what they’ve been doing is not right” and that they’re trying to “fix some of those errors.”

But “being a surgeon, I’m a skeptic,” Murphy added. “The proof is going to be in the pudding. Are they really going to step up and do things? Or are they doing something to placate an audience? We’re going to hold them to the fire continually, to make sure they’re doing what they say they’re going to do.”

Other providers expressed similar sentiments. “While this commitment is a step in the right direction, we will ultimately measure its impact by real changes in the day-to-day experiences of patients and the physicians who care for them,” said a statement from Shawn Martin, executive vice president and CEO of the American Academy of Family Physicians.

Though the proposed changes are voluntary, Oz noted in the June 23 briefing that legislation is pending to codify some of the industry’s voluntary proposals, if necessary. “We’re going to deal with this issue one way or another,” he said in the briefing. “The administration has made it clear, we’re not going to tolerate it anymore. So either you fix it, or we’re going to fix it.”

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Tony Pugh is an award-winning writer and editor covering Medicare for AARP. He has also covered Medicare for Bloomberg Law and as a national correspondent for Knight Ridder/McClatchy Newspapers.