On January 17, 2024, the Centers for Medicare & Medicaid Services (“CMS”) issued a final rule regarding interoperability and prior authorization (the “Rule”). CMS-0057-F. The Rule’s goals, according to CMS, are to facilitate the electronic exchange of health-care data, improve and expedite prior authorization processes, and reduce related burdens for payers, healthcare providers, and patients, with estimated savings of $15 billion over 10 years. The Rule’s changes focus on two areas: (1) interoperability advancement and (2) prior authorization streamlining. Both changes target federally regulated health insurers such as Medicare Advantage Organizations, state Medicaid and Children’s Health Insurance Program (“CHIP”) Fee-for-Service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan (“QHP”) issuers on the Federally Facilitated Exchanges (“FFEs”), (collectively, “Impacted Payers”).
For interoperability advancement, Impacted Payers must implement and maintain four application programing interfaces (“APIs”), which are software that allow other software applications to exchange information and features more efficiently. These four APIs are (1) the Patient Access API, (2) the Provider Access API, (3) the Payer-to-Payer API, and (4) the Prior Authorization API. Although compliance dates vary based on payer type, Impacted Payers must generally implement these four APIs by January 1, 2027.