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Axios
15 hours ago
- Business
- Axios
Traditional Medicare to add prior authorizations
Medicare is requiring more pre-treatment approvals in its fee-for-service program in a bid to root out unnecessary care, federal regulators announced Friday. The big picture: Traditional Medicare historically hasn't required prior authorizations to access most drugs or services, a major perk for enrollees. Prior authorization in privately-run Medicare Advantage plans has become a hot-button issue, with Congress and federal regulators working to rein in the practice. Federal inspectors found in 2022 that prior authorization in MA prevented some seniors from getting medically necessary care. Major health insurers this week made a voluntary pledge to streamline and improve the prior authorization process across all health insurance markets. State of play: Medicare's innovation center announced that it will solicit applications from companies to run the prior authorization program. Medicare is looking for companies with experience using AI and other tools to manage pre-approvals for other payers, and with clinicians who can conduct medical reviews to check coverage determinations. The program will start Jan. 1, 2026 and run through the end of 2031. It will only apply to providers and patients in New Jersey, Ohio, Oklahoma, Texas, Arizona and Washington. The change will apply to 17 items and services, including skin substitutes, deep brain stimulation for Parkinson's Disease, impotence treatment and arthroscopy for knee osteoarthritis. CMS selected the services based on previous reports and evidence of fraud, waste and abuse, as well as what's already subject to prior authorization in Medicare Advantage. Overuse of skin substitutes to help heal wounds has especially come under fire in recent years. Medicare spent more than $10 billion on the products in 2024 — more than double what was spent the year before, according to the New York Times. CMS noted that it may make other services subject to the prior authorization program in future years. Providers in the geographic areas can choose whether or not they want to submit an authorization request before delivering a service. But if they decide not to, they'll be subject to post-claim review and risk not getting paid for a service that was already delivered. "In general, this model will require the same information and clinical documentation that is already required to support Medicare FFS payment but earlier in the process, namely, prior to the service being furnished," the notice reads. Zoom in: The companies hired to manage the program will be paid based on how much they saved the government by stopping payments for unnecessary services. "Under the model, we will work to avoid any adverse impact on beneficiaries or providers/suppliers," CMS wrote in the notice.
Health Line
20-05-2025
- Health
- Health Line
Getting to Know Medicare Fee-for-Service (FFS) Plans
Medicare primarily operates a fee-for-service (FFS) payment system. This means that healthcare professionals and facilities bill Medicare for each service they provide, with itemized costs appearing on bills. Original Medicare consists of Part A, which covers inpatient hospital care, and Part B, which covers outpatient medical services. Medicare operates an FFS payment model in which healthcare facilities, doctors, and other healthcare professionals are reimbursed for each service they provide to Medicare beneficiaries. How Medicare FFS works When you receive treatment or services from a hospital, clinic, doctor, or other healthcare professional who is participating in Medicare, Medicare will typically bill them directly. Medicare will bill individually for each item or service the facility or healthcare professional provides. Billing example consultation ……… $100 lab work ………. $57 gauze ……… $12 bandage ………. $22 The Centers for Medicare & Medicaid Services provides numerous educational and support programs to help healthcare professionals understand and follow Medicare FFS policies. All about Medicare When you turn 65 years old, you'll be entitled to Medicare coverage. You may be eligible for Medicare before turning 65 if you have specific medical conditions. If you've worked and paid the relevant taxes for at least 40 quarters (about 10 years), you will not need to pay for Medicare Part A. If you have not, you'll pay a Part A premium, which differs depending on your work history. Most people are required to pay for Part B. To avoid late enrollment penalties, it is often a good idea to enroll in Part B when you first become eligible. »Learn more: When to Enroll in Medicare While Original Medicare parts A and B cover many inpatient and outpatient services, they do not cover everything. If you need coverage for take-home medications, you must enroll in a stand-alone Part D prescription drug plan. Private insurers administer these plans on Medicare's behalf, so coverage varies by insurance provider and location. However, according to Medicare rules, many of the most commonly prescribed drugs and drug classes must be covered. Alternatively, you might choose to enroll in a Medicare Advantage (Part C) plan. These plans are also administered by private insurers. They combine the benefits of Part A and Part B and often include prescription drug coverage. Some plans include additional benefits, such as fitness, vision, and dental. Medicare Advantage plans have monthly premiums that begin at $0, but you will typically still have to pay Medicare directly for your Part B premium. If you have Original Medicare, you can choose to enroll in an additional Medigap plan, which is Medicare supplement insurance. These plans cover many of the out-of-pocket costs associated with Original Medicare and might also include additional benefits. Private insurers offer Medigap plans, although the coverage is standardized by plan type. A benefit period starts on the day you are admitted to a hospital as an inpatient, and it ends when you have not received any inpatient hospital care for 60 consecutive days. Lifetime reserve days are extra days that Medicare will cover when you're admitted to a hospital for 90 days or more. You have a total of 60 reserve days to use over your lifetime. For every lifetime reserve day you use, Medicare will pay all eligible costs except for the daily coinsurance. Frequently asked questions Here are some common questions and answers about Medicare FFS plans. What is Medicare Fee-for-Service (FFS)? Medicare Fee-for-Service (FFS) is the payment model in which healthcare providers are reimbursed for each service delivered to Medicare beneficiaries. Medicare Fee-for-Service (FFS) is the payment model in which healthcare providers are reimbursed for each service delivered to Medicare beneficiaries. How does Medicare FFS differ from Medicare Advantage? Medicare is a government-run program, while Medicare Advantage plans are administered by private insurance companies. Medicare FFS allows you to see any provider that accepts Medicare, whereas Medicare Advantage plans may require you to use providers within a specific network. Medicare is a government-run program, while Medicare Advantage plans are administered by private insurance companies. Medicare FFS allows you to see any provider that accepts Medicare, whereas Medicare Advantage plans may require you to use providers within a specific network. What are Medicare FFS companion guides? Medicare FFS companion guides are resources for Medicare-participating healthcare professionals and facilities. The guides provide specific billing and communication guidance that can help streamline interactions between healthcare providers and Medicare. Medicare FFS companion guides are resources for Medicare-participating healthcare professionals and facilities. The guides provide specific billing and communication guidance that can help streamline interactions between healthcare providers and Medicare. Can I get additional coverage with Medicare? Yes, many Medicare beneficiaries get supplemental Medigap coverage to fill gaps in Original Medicare benefits. Takeaway Medicare typically runs a fee-for-service (FFS) billing system, which means that healthcare facilities, clinics, doctors, and other healthcare professionals bill for each service or item they provide. You become eligible for Medicare when you turn 65 years old. You can become eligible before age 65 if you have certain medical conditions. Out-of-pocket costs apply to most Medicare plans, but help is available for those with low income and few resources. The information on this website may assist you in making personal decisions about insurance, but it is not intended to provide advice regarding the purchase or use of any insurance or insurance products. Healthline Media does not transact the business of insurance in any manner and is not licensed as an insurance company or producer in any U.S. jurisdiction. Healthline Media does not recommend or endorse any third parties that may transact the business of insurance.
