Group of doctors looking at the camera.
Group of doctors looking at the camera.

Lessons for Canada on Prior Authorization Reform: An American Experience

Since 2020, the conversation around improving the prior authorization process and experience has been gaining traction in Canada. However, there has been much more than discussion in the U.S. While the Canadian and U.S. private payer markets differ in the extent of benefits coverage provided to plan members under group policies, both countries rely heavily on private payers, typically insurers and pharmacy benefit managers, to adjudicate prescription drug and prior authorization claims. Similar challenges and opportunities for improvement have been identified in the prior authorization claims processes in both countries. In examining the U.S. experience, Canadians can gain insights into opportunities for change to improve the process, along with some pitfalls to avoid.

In 2018, leading healthcare associations in the U.S. came together to collaborate on a landmark initiative that resulted in a Consensus Statement on Improving the Prior Authorization Process. The partnership was made up of several healthcare associations, including the American Medical Association (AMA), American Hospital Association (AHA), America’s Health Insurance Plans (AHIP), American Pharmacists Association (APhA), BlueCross BlueShield Association (BCBSA) and Medical Group Management Association (MGMA).

The five areas of opportunities identified for improvement in the U.S. Consensus Statement included the opportunity for selective application of prior authorization requirements for those prescribers who had demonstrated adherence to clinical standards; regular review of the list of prior authorization drugs; the need to improve transparency and communication regarding prior authorization requirements; minimizing requirements that disrupt continuity of care; and moving towards an electronic prior authorization solution.

In Canada, the Simplify Prior Authorization (SPA) initiative was established in 2021 following the release of the White Paper on Prior Authorization in Canada. The white paper included several recommendations for change, including demystifying the prior authorization process and developing a simplified, streamlined prior authorization process among private payers. The key deliverables of the SPA initiative since 2021 include:

  • Ongoing research and dialogue with industry stakeholders, associations, key opinion leaders, ePA providers and influencers to facilitate improvements in prior authorization
  • Collaboration with industry experts to identify criteria and key deliverables for an electronic prior authorization solutions provider
  • A market study to identify a partner who could deliver an agnostic, cost-effective electronic claims submission solution to stakeholders
  • Regular advocacy for change through webinars, blogs, podcasts, and social media
  • Development and launch of a robust information, advocacy, and resource website in 2023 to support the needs of stakeholders.

In 2023 a prior authorization best practices/industry standards guide is under development that will be a reference for payers and other stakeholders. Patients, physicians, and patient support programs will be able to evaluate their experiences of prior authorization against reasonable benchmarks, and payers will be able to evaluate themselves. In 2024, with sufficient financial support, a national prior authorization stakeholder survey will be conducted and results will be published.

The SPA initiative is committed to working with all stakeholders within a collaborative, consensus-drive approach. Why is this so important?

Bringing together all relevant stakeholders allows for a broader range of perspectives and creates a platform for productive dialogue, leading to the identification of common goals and areas for improvement in the PA landscape. Encouraging consensus and shared decision making can foster a sense of ownership and commitment to the initiative among stakeholders, leading to sustainable reform that addresses all stakeholder concerns.

What can be learned from the American Experience?

As much as the American Consensus Statement provides common sense recommendations for the U.S. market, it also serves as a lesson on why these types of high-level documents are not enough. Collaboration and consensus of the stakeholders that use and own the process is necessary to create deliverables that are achievable and measurable. Without this collaboration, U.S. evidence suggests that payers may find themselves with legislated standards within the prior authorization process they created.

In the U.S., where payers have refused to make improvements in prior authorization, legislators are taking control.

While agreeing to certain prior authorization reforms in the 2018 consensus statement, a 2021 AMA survey found that health insurers were yet to implement them. As a result, the AMA urged state legislation. Between 2021-2022 many states responded by moving to regulate aspects of prior authorization in their jurisdictions. Federal legislators have also moved to reform prior authorization for Medicare and Medicaid patients through new regulations, which include the adoption of electronic prior authorization. This has received bipartisan support including support from the Ways and Means Committee.

In Canada provincial public payers in Ontario and B.C. have already taken the lead by adopting electronic prior authorization. The private sector in Canada should look to the U.S. and our own provinces and adopt a proactive, collaborative approach to simplifying the prior authorization process acknowledging lessons learned from the U.S.

  • Stakeholders, including payers, should adopt one national electronic prior authorization platform for submitting claims that can be used by patient support professionals, physicians, and pharmacy to eliminate the current paper-based process. Not only will this reduce the administrative burden for all stakeholders, but it will also improve the ability to analyze aggregate data related to patient response and outcomes. This data will ultimately facilitate health outcomes-based product listing agreements.
  • Create best practice/industry standards for prior authorization that will create clear expectations of payers and other stakeholders in the prior authorization claims process and improve the experience for all stakeholders.

It is time for all Canadians impacted by prior authorization to make their voices heard and call for improvements. Contact Denise Balch, Project Manager for more information on how you can get involved.

Want to know more?

Future blog issues will identify the prior authorization legislation in U.S. states and whether each is viable in Canada. We will also be sharing insights into best practices in prior authorization. Join our initiative today to find out more about how we can work together to create a more efficient prior authorization process that benefits payers and other PA stakeholders.

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