The Centers for Medicare & Medicaid Services (CMS) has introduced a proposed rule that would extend its prior authorization interoperability framework to prescription drugs for the first time, building on its earlier efforts focused on medical services.
Key Highlights for Providers:
- Expansion to Drug Coverage
The proposal would apply interoperability and prior authorization requirements to medications, impacting Medicaid, CHIP, ACA plans, and certain small group market insurers. It builds on CMS’ 2024 rule that introduced API-based workflows for medical services. - Real-Time Pharmacy Data Access
Beginning in 2027, payers would be required tosupport standardized pharmacy data exchange, allowing providers to check formularies, verify coverage, and submit electronic prior authorizations for drugs in real time. - Faster Decision Timeframes
CMS is proposing stricter turnaround times for drug prior authorizations, with responses required as quickly as 24 hours for expedited requests anddefined limits for standard requests. Payers would also need to provide clear reasons for denials. - New Transparency Requirements
For the first time, payers would publicly report prior authorization metrics specific to drugs—such as approval rates, denials, and turnaround times—expanding on existing reporting for medical services. - Future-Focused Policy Considerations
The rule includes requests for feedback on broader issues like care coordination alerts, cybersecurity, and reducing administrative burden. It also proposes adopting FHIR-based standards for prior authorization transactions under HIPAA. - Industry Context
The proposal comes as insurers, including members of AHIP and the Blue Cross Blue Shield Association, have already begun reducing prior authorization requirements voluntarily—suggesting continued momentum toward streamlining processes.
Resource: CMS proposes extension of prior authorization rule to cover drugs: 6 notes