More than 60 insurers sign pledge to simplify prior authorization by 2027

More than 60 health insurers have signed a voluntary pledge, announced June 23, 2025 by the Department of Health and Human Services and the Centers for Medicare & Medicaid Services, to narrow the use of prior authorization, speed up electronic decisions and keep an existing approval valid for 90 days when a patient changes plans ^[1][2][3].

The agreement took shape after a roundtable in June 2025, when HHS Secretary Robert F. Kennedy Jr., CMS Administrator Dr. Mehmet Oz and the national coordinator for health IT, Dr. Thomas Keane, met with industry leaders ^[1]. AHIP, the trade group that organized the commitment with the Blue Cross Blue Shield Association, says the participating health plans cover about 270 million people across commercial coverage, Medicare Advantage and Medicaid managed care ^[2]. The American Medical Association, which has pressed for tighter rules, counted more than 60 signatories as of its July 14, 2025 report ^[3].

The first deadlines arrived January 1, 2026 ^[2]. Each insurer agreed to shrink the list of medical services that need pre-approval, with the size of the cut left to each plan based on its local market ^[2][3]. Plans also began extending a prior approval for a 90-day transition period after a member switches insurers mid-treatment, as long as the service is still a covered benefit and the provider is in network ^[2][3]. Denial notices are supposed to explain the decision in clear, personalized language with appeal instructions ^[2][3]. Requests denied on clinical grounds are to be reviewed by a licensed clinician, which AHIP describes as standard practice already ^[2][3].

The later deadlines are technical. By January 1, 2027, the plans aim to handle electronic prior authorization requests through a shared format built on FHIR application programming interfaces, which carry structured data instead of faxes and phone calls ^[1][2][3]. CMS says health plans it regulates must have those interfaces up and running from that date ^[1]. Also in 2027, when a provider submits a request electronically with all supporting documentation, the target is a real-time answer for at least 80 percent of approvals ^[2][3].

The paperwork involved is sizable. CMS estimates that requesting prior authorizations costs providers $20 to $50 per hour and takes an average of 13 hours per week, which works out to about $34,000 and 700 hours of administrative time per provider each year ^[1]. AHIP says close to half of all prior authorization requests still arrive by fax or phone, which limits how much the electronic goals can achieve unless providers change how they submit ^[2].

The AMA praised parts of the deal while flagging its edges. AMA President Bobby Mukkamala, MD, said the process "remains costly, inefficient, opaque, and too often hazardous for patients" ^[3]. The AMA notes that the commitments do not cover prescription-drug benefits, apply only to certain types of health plans and represent just some of the reforms the group has sought ^[3].

Why it matters for patients

Prior authorization is a review insurers use to decide in advance whether they will pay for a service; AHIP describes it as a safeguard that holds down premiums and out-of-pocket costs ^[2], while CMS says the process creates delays and administrative burden that can stand between patients and care ^[1]. Where the two accounts agree is that the experience is frustrating and slow ^[1][2].

The 90-day continuity provision could matter to anyone mid-treatment who changes jobs or insurers, but only if the new plan covers that service and the clinician is in its network ^[2][3]. Whether the pledge changes coverage reviews for GLP-1 medicines such as semaglutide (Ozempic, Wegovy, Rybelsus) or tirzepatide (Mounjaro, Zepbound) has not been reported; the AMA says the commitments exclude prescription-drug benefits ^[3]. CMS separately advises providers to ask their EHR vendor whether it supports electronic prior authorization for Part D drugs ^[1].

How much patients notice also depends on adoption. Real-time answers require requests filed electronically with complete documentation, and nearly half are still submitted by fax or phone ^[2]. Providers need updated systems and vendor support to take part ^[1].

What happens next

• Spring 2026: AHIP and the Blue Cross Blue Shield Association said they would publish the first of regular updates on how the commitments are being carried out ^[2].
• January 1, 2027: Standardized electronic prior authorization using FHIR APIs is to be available to plans and providers, and certain CMS-regulated plans must maintain the required interfaces from that date ^[1][2].
• 2027: At least 80 percent of electronic approvals submitted with complete documentation are to be answered in real time ^[2][3].

Whether insurers meet those targets, and whether drug benefits are added later, has not been disclosed. The AMA said it will monitor implementation and keep pursuing legislative and regulatory changes ^[3].