Medicare Update: Prior Authorization Request Process for Certain Hospital Outpatient Services

Jun 24, 2020

By Jerilyn Morrissey, MD

Five hospital outpatient department (OPD) services will require prior authorization when provided on or after July 1, 2020. These services include:

  1. Blepharoplasty
  2. Botulinum toxin injections
  3. Panniculectomy
  4. Rhinoplasty
  5. Vein ablation

What is prior authorization as it relates to a Medicare beneficiary?

The new prior authorization process requires that hospital outpatient departments submit a request for provisional affirmation of coverage for review before the service is rendered to a beneficiary and before a claim is submitted for payment. Your Medicare Administrative Contractor (MAC), can render:

  • A provisional affirmation decision: "a preliminary finding that a future claim submitted to Medicare for the item or service likely meets Medicare’s coverage, coding, and payment requirements."
  • A non-affirmation decision: "a preliminary finding that, if a future claim is submitted for the item or service, it does not meet Medicare’s coverage, coding, and payment requirements."
  • A provisional partial affirmation decision: which "means that one or more service(s) on the request received a provisional affirmation decision, and one or more service(s) received a non-affirmation decision.” Source: Prior Authorization Process for Certain Hospital Outpatient Department (OPD) Services Frequently Asked Questions (FAQs)

Starting June 17, 2020, your organization can submit a prior authorization request to your Medicare Administrative Contractor (MAC) for services to be provided on or after July 1, 2020. 

Here are some things you should keep in mind:

  • This new process only applies to claims submitted to Medicare Fee-For-Service.
  • There are no specific forms to complete a Prior Authorization Request.
  • Your MAC is expected to provide you with a decision ten (10) business days from the date the PAR is received, excluding federal holidays.
  • If you need a decision sooner, you may request an expedited review if the standard timeframe for making a decision could seriously jeopardize the beneficiary’s life or health.
  • Providers may become exempt from the prior authorization process if error rates in referred cases are less than 10% for a period 6 months. CMS will assess provider compliance semiannually and anticipates exemptions for providers will start to be granted sometime in calendar 2021.
  • All related claims will be denied (physician, anesthesia, etc.) if the claim is denied for lack of prior authorization.
  • The regulations are located at 42 CFR §419.80-419.83.

To address some of the confusion, CMS has released several documents to help hospitals appropriately implement this new process. These documents include:

Questions/Comments? Contact me at 1.866.299.3301 or send me an email.

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