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How Medicare Advantage Prior Authorization Will Change in 2024

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How Medicare Advantage Prior Authorization Will Change in 2024

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Prior authorization

If your practice is like most, you’ve faced myriad headaches dealing with Medicare Advantage (MA) denials. In some cases, even when MA plans approve prior authorizations for certain services, you end up facing denied claims. Thanks to a new rule, however, that issue should go away in January.

Background: On April 5, CMS issued a Final Rule enhancing a variety of Medicare programs. As part of the changes, Medicare Advantage (MA) will significantly change as of January 1, 2024.

To prepare for the MA prior authorization changes, check out a few key highlights.

MA Plans Need ‘Good Cause’ to Deny Claims After Prior Auth

Under the new rule, once an MA plan approves a prior authorization for an item or service, the plan can’t later deny coverage due to a lack of medical necessity unless it can find “good cause” or evidence of fraud.

In other words, once you get a prior authorization from the beneficiary’s MA plan, the payer must prove that it has good cause to later deny that procedure, item or service down the road. This is expected to cut down on the extra steps that MA plans have instituted in the past following a prior authorization approval.

Medical organizations have cheered this coming change. “The American Medical Association and nearly 120 physician organizations are strongly supporting proposed reforms of prior authorization in the Medicare Advantage and Medicare prescription drug benefit,” the AMA said in a statement.

MA Authorizations Must Be Valid as Long as Is Medically Necessary

Once an MA plan makes a prior authorization approval, it must remain valid “for as long as medically necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient’s medical history and the treating provider’s recommendation,” CMS says.

In other worse, the MA plan can’t pull the prior auth approval before the service or procedure is provided. The only exceptions occur if it’s no longer medically necessary (e.g., the patient’s condition changes), the coverage criteria change, or the treating provider no longer thinks it’s necessary.

If Beneficiary Changes Plans, a 90-Day Transition Period Applies

To ensure continuity of coverage, if an MA beneficiary changes to a new plan, the prior authorization continues to stay in place during a 90-day transition period rather than immediately being discontinued.

For instance, suppose a patient switches from an MA plan run by their state Blue Cross program to one run by Aetna. Any prior authorizations that Blue Cross approved in December would remain valid in January under Aetna while the patient transitions care into the Aetna plan.

MA Plans Must Comply With FFS Plan LCDs

Under the new policy, Medicare Advantage plans must comply with local coverage determinations (LCDs) and national coverage determinations (NCDs) applicable under traditional Medicare fee-for-service (FFS) plans.

If an NCD or LCD isn’t available for a particular service, the MA plan can create internal coverage criteria, but they must first post a summary of the evidence they used to make the decision.

Seeking more billing tips to help you collect maximum reimbursement for your practice? Expert Tracy Bird, FACMPE, CPC, can help during her 60-minute online training, Simplify Patient Eligibility Verification to Slash Denials & Boost Pay. Listen as Tracy shares all the strategies you need to improve cash flow at your practice.

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