CMS Seeks to Advance Electronic Prior Authorization
The agency invites healthcare providers to join efforts.
On May 5, 2026, the Centers for Medicare & Medicaid Services (CMS) announced a new prior authorization initiative to address technical gaps in the current prior authorization process. The initiative, called “Moving Prior Authorization into the 21st Century,” builds on a pledge the insurance community made last June to reduce and refine the use of prior authorization. The agency has also issued several regulations over the past few months to streamline the process through electronic or digital prior authorization.
With this latest announcement, CMS is inviting the broader healthcare community to join its efforts to modernize the prior authorization process. CMS Administrator Mehmet Oz stated in his announcement:
“The initial landmark pledge effort brought the nation’s major health plans to the table. This new initiative brings everyone else. Health systems, hospitals, physician practices, electronic health record (HER) vendors, and digital health developers are now joining payers as a unified coalition aligned around a single mission: making electronic prior authorization work end-to-end, on time, for every patient.”
CMS is also refining the prior authorization process through regulatory initiatives.
1/1/26: Medicare Advantage, Medicaid, and Children’s Health Insurance Program (CHIP) plans, as well as Marketplace (Federally-facilitated Exchange) plans, are required to send prior authorization decisions for medical items and services within 72 hours for expedited (urgent) requests and within 7 calendar days for standard (non-urgent) requests.
1/1/27: Electronic prior authorization interfaces from these payers will go live, and their use will be incorporated into the Medicare Promoting Interoperability Program for hospitals and the Merit-based Incentive Payment System (MIPS) for clinicians. CMS estimates $15 billion in savings over 10 years.
Drugs: CMS is also proposing reforms to expand electronic prior authorization to drugs.
CMS has released several resources for healthcare providers to familiarize themselves with these efforts.
Modernizing and streamlining prior authorization is central to the agency’s overall goals and priorities. Stakeholders should anticipate continued agency activity in this area. While Administrator Oz has acknowledged the burdens of prior authorization on clinicians, he also noted in public comments a certain level of hesitancy among clinicians to fully embrace efforts to reform the process.
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For more information and questions, please contact:
Sheila Madhani
Madhani Healthcare Consulting
Email: smadhani@madhani-health.com
Tel: (202) 679-2977