Medical innovation outpaces medical policy with health insurance plans. That reality can be difficult to accept for companies that have poured significant investment into a new device, drug, or biologic. For health plans, FDA marketing authorization is important, but other factors are essential: long-term data, medical society guidelines, provider utilization, etc. Until those factors are addressed, health plans often either stay silent on a new technology or label it “experimental/investigational” (E/I).
So, what do providers and patients do when faced with no medical policy or a negative medical policy? They request a prior authorization and, if denied, appeal the case all the way through to external review by an independent review organization – a right protected by the Affordable Care Act.
Health plans have determined that if they do not allow a prior authorization of an E/I technology (because it’s “not covered”), then there is no denial to appeal. And if the case does get to independent review, how independent is that review?
These compounding challenges deserve more discussion, because they are not in fact just administrative technicalities – they are unnecessary structural barriers with real consequences for real patients.
Challenge 1: No Prior Authorization Required or Allowed
Prior authorization is often the indispensable first step in securing reimbursement for innovative procedures. Without it, particularly for newer therapies where medical necessity may face scrutiny, providers face heightened risk of claim denial, and patients face the prospect of unexpected out-of-pocket costs. And yet, many commercial health plans will not allow prior authorization for procedures they classify as E/I, regardless of the care setting.
The stated rationale is that non-covered procedures don’t warrant prior authorization. In practice, this creates an impossible cycle: a procedure cannot gain coverage without evidence of use, and it cannot be used without the assurance that prior authorization provides. This is one of the most persistent access barriers for innovative medical technologies today.
When a health plan claims that prior authorization isn’t required or allowed, an experienced patient access team will have the ability to escalate this, first by confirming this with a supervisor, then by requesting a pre-determination or a courtesy review, then by asking for a mock claim process. This kind of tenacity by skilled patient access professionals can often move the needle.
But these are hard-won, workaround strategies. They are not solutions. They still leave patients without the knowledge that prior authorization is designed to afford.
The policy implication is clear: payers must be required to allow prior authorization when a provider requests it, not only when the payer deems it appropriate.
Challenge 2: The External Review is Not Always Independent
Assume a patient and provider manage to navigate the prior authorization barrier, receive a denial, survive the internal appeals process, and reach the final recourse the Affordable Care Act promises them: an external review by an independent review organization (IRO). This should be the safety net — a true, objective assessment conducted by a qualified clinical reviewer who is free from the health plan’s influence.
Our experience with this process as patient advocates is that much of the time, this works. But we are starting to see a troubling pattern with a subset of IROs that are national in scope and contracted by many major health plans.
These organizations have been consistently affirming the plan’s denial by simply referring back to the plan’s negative medical policy.
When an IRO simply restates the plan’s negative coverage determination, effectively rubber-stamping the denial, it renders the external review process meaningless as a consumer protection. Whether this practice constitutes a violation of the letter of the law is a question for regulators to answer. What is not in question is that it corrodes the integrity of a protection that Congress specifically codified into the ACA for exactly these situations.
Compounding this problem is the prior authorization barrier described above. The ACA grants patients the right to a pre-service external review when a prior authorization is denied in writing. But when a plan refuses to conduct a prior authorization at all, no written denial is issued, and with no denial in hand, a patient cannot trigger the external review process. Patients are effectively stripped of an ACA-protected right without the payer ever having to formally deny them anything.
The Path Forward
These two challenges are related. They represent a coherent system that insulates payers. Addressing them requires:
- Legislative action on prior authorization. Federal and state lawmakers must require that payers allow prior authorization requests for any service a licensed provider deems medically appropriate.
- IRO accountability and oversight. Regulators must ensure that IROs conduct genuine, evidence-based reviews rather than deferring to the contracting plan’s existing medical policy.
We at JDL Access will continue to advocate for patients case by case, as well as with policymakers to ensure that the system is fair, transparent, and genuinely independent.
