CMS Finalizes Policies on Prior Authorization Nearly a Year After Proposed Rule was Released

On January 17, the Centers for Medicare & Medicaid Services (CMS) released a final rule that outlines policy changes to the prior authorization (PA) process for Medicare Advantage (MA) organizations, state Medicaid and Children’s Health Insurance Program (CHIP) Fee-for-Service (FFS) programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan (QHP) insurers on the Federally Facilitated Exchanges (FFEs). Medicare FFS is not covered by the policies of this rule.

The provisions of the final rule streamline the PA process and alleviate administrative burden for providers and apply only to PA for items and services only. Drugs of any type are not covered by the rule. Additionally, many of the policies will not go into effect until January 2026, with some policies not effective until January 1, 2027.

A summary of the final rule and highlights of the SGO comment letter are available to provide additional detail.