Earlier this year, Arkansas became the latest among a handful of states to enact “gold card” legislation to try to shorten the approval process for medical procedures and prescriptions.
Act 575, sponsored by Sen. Missy Irvin, R-Mountain View, and Rep. Lee Johnson, R-Greenwood, gives automatic approval in many cases for procedures and drugs ordered by physicians who have achieved a 90% standard on previous approvals from insurance providers. Health care insurers review such physician requests, a process called prior authorization, to determine if the procedure or drug is appropriate.
Johnson, an emergency room physician in Fort Smith and Van Buren, said prior authorization is an important tool in controlling health care costs, but it can also delay needed medical care for patients. He said Act 575 was an attempt to find a “happy medium” between cost control and patient care.
“That is exactly the spirit of the legislation,” Johnson said. “I believe prior authorizations are important guardrails to have in place to protect both insurance companies and consumers from the potential of people ordering tests unnecessarily. It is an important tool, but my issue is if you have proven yourself to be a good steward of the process, there ought to be a way you get rewarded for that good performance.”
KFF, formerly the Kaiser Family Foundation, reported in 2023 that 16% of patients had complaints about prior authorization affecting their health care. And while it may be tempting to paint health care insurance companies as the bad guy in such cases, prior authorization can prevent waste and fraud.
“We have a responsibility to make sure they are getting the right service,” said Max Greenwood, vice president at Arkansas Blue Cross & Blue Shield. “To be honest, the insurance industry was also trying to find ways to reduce the prevalence of prior authorization. It’s time-consuming and a headache for the doctor and the member. There is a ton of waste and fraud in health care, tons.
“Every other week you’re seeing stories in the paper nationally about millions of dollars in Medicare fraud and Medicaid fraud. We know there is fraud. It’s a balancing act.”
Hurry Up, Wait
Act 575 doesn’t solve all the problems with prior authorization, and the prescription drug aspect of the law doesn’t go into effect until 2025, but Johnson said it is a good start to addressing an old problem.
“It is certainly not a new problem,” said David Wroten, executive vice president of the Arkansas Medical Society, which was a strong supporter of the eventual law. “It has always been a problem. It’s not just a problem with prescription drugs; it’s a problem with anything that a physician might prescribe.
“I don’t see a big trend getting worse; it has been bad for a while.”
John Vinson, CEO of the Arkansas Pharmacists Association, said one reason that issues involving prior authorizations are under increasing scrutiny is the increase in expensive new drugs on the market. An insurance company might not concern itself with a $15-a-month drug request, but a $10,000-a-month drug will grab attention.
“You could get into a situation where there is more red tape and higher costs from the PA than the therapy would be,” Vinson said. “You talk about avoiding waste, but you can also create waste when the prior authorization process is too restrictive and interferes with patient care. It is figuring out that right balance.”
Johnson hopes Act 575 is that right balance. The potential winners are patients, who don’t have to wait out paperwork bureaucracy for needed medical care.
“The truth is that with any piece of legislation you are making efforts to try to make a process better,” Johnson said. “This was our first foray into this idea, and I think the idea has merit. Did we get it exactly right this time? I don’t suspect that we did.
“In my opinion, it had gotten to the point where it was creating more barriers to care than cost containment. It had become an onerous process. At some point you have to accept that as clinicians we know the right test to order, and we should have the freedom to order that test without a lot of delays in care.”
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