CMS Launches Pilot for Enhanced Medicare Advantage Authorization Processes

The Centers for Medicare & Medicaid Services (CMS) will launch a pilot program in 2026 to collect comprehensive data on prior authorization decisions and appeals within Medicare Advantage plans. This memorandum-initiated effort, released on December 16, aims to enhance data transparency and optimize process efficiency across the sector. By late 2026, health insurers will have a six-month window to prepare, as CMS gathers insights needed for accurate reporting before expanding the effort across all Medicare Advantage plans by 2027.

During the pilot phase, participating insurers must detail metrics such as authorization processing times, decision justifications, and service locations. Additionally, they will document third-party vendor involvement in the decision-making process. This initiative, stemming from dialogues with health insurance providers, seeks to strengthen efficiency in AI-driven prior authorization decisions, which align with broader regulatory compliance requirements to curb delayed reimbursements and improper claims processes.

Health plans interested in participating have until January 9 to express their interest in the pilot. The insurance industry is monitoring these developments, as they could bring shifts in operational workflows, compliance, and risk management for Medicare Advantage providers. This pilot represents a strategic move to address inefficiencies that previously resulted in penalties at the state level, highlighting the pressing need for improved regulatory compliance and streamlined claims processes.