GAO Findings on Prior Authorization and HATA’s Survey

HATA survey reveals membership dissatisfaction with prior authorization transactions.

In a recent report to the U.S. Senate Committee on Finance, the Government Accountability Office (GAO) was asked to examine the Centers for Medicare & Medicaid Services’ (CMS’s) prior authorization programs, including its benefits and challenges. The GAO spoke with many providers, suppliers, and beneficiary group officials who reported on the benefits of prior authorization. However, these same groups also reported challenges, including difficulty obtaining the necessary documentation from referring physicians to submit a prior authorization (PA) request, even though CMS had created templates and other tools to address this concern.

In a study presented to the Healthcare Administrative Technology Association (HATA), the association representing the practice management system (PMS) industry, the American Medical Association (AMA) found why providers were so dissatisfied with the prior authorization transaction. The AMA reported that prior authorization requirements among different payers are inconsistent. Many providers are rarely aware of what information is required for a prior authorization, which leads to a significant amount of back-and-forth between the provider and the payers, resulting in more care delays and frustration on the provider’s behalf. It also found that multiple routes exist to obtain PA, depending on the health plan, drug, pharmacy, and patient combination.

The Workgroup for Electronic Data Interchange (WEDI) Prior Authorization Workgroup identified what may be behind such a current lack of integration: the deficiency of interoperability between a provider’s administrative (practice management) and clinical (electronic health record) systems. This lack of integration makes it challenging for providers to electronically pull together and send health plans all the information needed to support prior authorizations. 

In 2017, HATA conducted a survey of its PMS vendor members and found that only 33 percent offer the prior authorization transaction (278) to their providers. Of those clients utilizing the 278, all of them are using it for referrals only, not prior authorization. Reasons the PMS vendors do not offer 278 include the following:

  • Lack of provider interest (63 percent)
  • Lack of payer commitment (63 percent)
  • Development limitations (50 percent)
  • Unreliable information exchange (25 percent)
  • Interoperability challenges (12.5 percent)

The comment heard over and over was that there was a general industry lack of understanding due to non-use and lack of implementation. One hundred percent of respondents answered that only 1-10 percent of clients currently utilize the 278 transaction. The survey can be found on the HATA website at  http://www.hata-assn.org/general-resource-page.

Regarding the lack of administrative and clinical integration, the HATA workgroup noted that the electronic health record (EHR) flows to the practice management system, but the practice management system doesn’t flow to the EHR. Therefore, if the 278 is initiated on the clinical side, the assigned PA number must flow back into the PM system to be placed on the claim for appropriate adjudication by the insurance company.

HATA is about to launch an incubator project that will bring together the practice, the practice management system vendor, the electronic medical record vendor, the clearinghouse vendor, and the payer (which may or may not include a third-party administrator) to walk through this process from beginning to end. By using real data, HATA will have all the elements in place to make significant improvements to the process.

Comment on this article

Facebook
Twitter
LinkedIn

Related Stories

Leave a Reply

Please log in to your account to comment on this article.

Featured Webcasts

Inpatient Ulcers and Gangrene: Avoid FY 2027 ICD-10-CM Coding, Sequencing, and Documentation Errors

Avoid costly inpatient coding errors involving ulcers and gangrene. This practical FY 2027 ICD-10-CM webcast clarifies pressure injury staging, non-pressure ulcer severity, diagnosis sequencing, documentation requirements, and POA reporting. Through real-world cases, gain the confidence to make defensible coding decisions, reduce denials, strengthen compliance, and support accurate reimbursement.

November 4, 2026

One Chart, Five Truths: How CDI Prevents the Same Diagnosis from Becoming Five Different Outcomes

What happens when everyone reviews the same chart, but reaches a different conclusion? In this case-based clinical documentation integrity (CDI) webcast, Penny Jefferson examines how documentation involving clinical support, timing, causation, linkage, and terminology can produce very different outcomes for ICD-10 coding, reimbursement, quality, risk adjustment, medical necessity, denials, and compliance. Using cases involving postoperative respiratory failure, severe malnutrition, and encephalopathy, you’ll learn the practical CLEAR framework to help attendees learn to evaluate whether a diagnosis is codeable, consistent, specific, reportable, and ultimately defensible across the different teams and systems that rely on the medical record.

September 30, 2026

Mastering Spinal Fusion Coding for Inpatient Facilities: ICD-10-PCS Precision, Documentation, and MS-DRG Impact

Spinal fusion cases are among the most complex inpatient procedures to code, where even minor ICD-10-PCS errors can affect MS-DRG assignment, reimbursement, compliance, and audit outcomes. This practical webcast provides a step-by-step framework for interpreting operative reports, assigning accurate ICD-10-PCS codes, recognizing documentation gaps, and confidently coding complex fusion procedures. You’ll leave with practical tools that improve coding accuracy, reduce denials and audit risk, and strengthen documentation-driven reimbursement decisions.

July 29, 2026

AI, Audits, and the Future of the Revenue Cycle

Artificial intelligence is rapidly transforming healthcare revenue cycle operations, from coding and auditing to compliance and denials. Join industry leaders Pam Warren (MaineHealth) and Raemarie Jimenez (AAPC) for a live fireside chat exploring how AI is changing workflows, workforce roles, payer-provider dynamics, and compliance risk—and what organizations should be doing now to prepare.

Webcast Only Available On ICD10monitor Subscription – Subscribe Below

June 17, 2026

Trending News

Featured Webcasts

Radiation Oncology Fundamentals: Coding, Billing & Compliance for Hospital Outpatient & Professional Services

Join Michael Calahan, PA, MBA for this radiation oncology coding and compliance webcast as he explains the fundamentals of coding, billing, reporting, and documentation for hospital outpatient and professional services. Learn how the 2026 radiation therapy coding changes affect current practices, how to distinguish technical and professional services, and how to address bundling, units, frequency, modifiers, and documentation requirements. Michael will also help you identify radiation oncology coding and billing vulnerabilities that could lead to denials, overpayments, repayment demands, or federal audit exposure.

October 20, 2026

Preparing for 2027: Inpatient & Outpatient Policy Changes for Case Management and Utilization Review

The 2027 CMS policy changes will impact case management, utilization review, reimbursement, and patient status decision-making long before they officially take effect. Join nationally recognized physician advisor Dr. Ronald Hirsch as he explains the finalized and proposed inpatient and outpatient rule changes, expanding bundled payment initiatives, payment updates, and evolving payer expectations. Gain practical guidance to help your organization prepare early, strengthen compliance, reduce reimbursement risk, and confidently navigate the transition to 2027.

September 17, 2026

The Two-Midnight Rule: Strengthening Compliance Through the Fundamentals, 2026 Updates, & 2027 Proposed Changes.

The Two-Midnight Rule continues to be one of Medicare’s most closely monitored compliance areas and now the rules are changing again. Join compliance expert Michael Calahan for a practical review of the latest 2026 policy updates, the proposed 2027 OPPS changes affecting inpatient-only procedures, and the best practices hospitals need to reduce audit risk, strengthen admission decisions, and protect reimbursement. Leave with actionable strategies you can immediately apply to improve compliance and confidently prepare for increased federal and Medicare Advantage scrutiny.

August 11, 2026

Trending News

Prepare for the 2025 CMS IPPS Final Rule with ICD10monitor’s IPPSPalooza! Click HERE to learn more

Get 15% OFF on all educational webcasts at ICD10monitor with code JULYFOURTH24 until July 4, 2024—start learning today!

This Memorial Day, we honor those who gave all for our freedom. Take 20% off sitewide through May 29 with code MEMORIAL26 at checkout

CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 1 with code CYBER25

CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 2 with code CYBER24