Medicare Changes in 2026 for Prior Authorizations
Several Medicare changes in 2026 are underway. A few won’t have an immediate impact. But others could have a big impact on both providers and patients — in a good way.
This article covers key changes, how they’ll benefit providers and patients, and what providers want to know.
Mandated Medicare Changes in 2026 for Prior Authorization Processes
Effective date: January 1, 2026
Mandated Prior Authorization Turnaround Times
In January 2024, the Centers for Medicare & Medicaid (CMS) mandated changes to improve prior authorizations that will begin January 1, 2026. Changes affect insurance companies (payers) and will benefit both providers and patients.
The Medicare changes mandate that payers reply to prior authorization requests for urgent needs in 72 hours. Decisions for non-urgent requests must be made in 7 calendar days, not business days.
The changes apply to:
- Medicare Advantage plans
- Medicaid managed care plans
- State Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs
- CHIP managed care entities
Qualified Health Plans (QHPs) on the Federally-Facilitated Exchanges (FFEs) are exempt.
Surveys have shown that the average turnaround in prior authorization requests is 1 to 3 days. Some patients though have reported waiting more than a week, sometimes even months. In some cases, patients have died, been hospitalized, or suffered permanent damage as a result of delayed decisions.
The new mandate is the first to specify specific timeframes and impose fines for noncompliance. The timeframes mandated are broader than proposed by the AMA in an April 24, 2025 article titled, “Fixing prior auth: First, speed up payers’ response times.” The AMA called for a 48-hour window for non-urgent needs and 24 hours for urgent needs.
Still the mandate should help eliminate authorizations taking weeks or months and ensure more timely care decisions overall. Patients will, on average, get more timely care. And providers can provide care and process reimbursements more quickly overall as well.
Mandated Sharing of Denial Reasons
In addition to mandated timeframes, CMS will also require payers give a specific reason when denying a prior authorization. They can share the reason by portal, fax, email, mail, or phone, regardless of how they shared the denial. Prior authorization decisions on prescription drugs are excluded.
The benefit of this mandate is that it should help providers more easily and quickly resubmit requests when authorizations are denied. Denied requests should spend less time stuck in the approval loop as well.
Mandated Health Insurance Company Accountability Metrics
CMS’s Medicare changes in 2026 also mandate that payers start reporting metrics about their authorizations on their public websites each year starting March 31, 2026.
More Prior Authorization Improvements from Medicare Changes Coming in 2027
Additional Medicare changes in 2027 will also help improve the prior authorization process.
Health Insurance Companies Agree to Make Improvements
A benefit of these CMS mandated Medicare changes coming in 2026 is that healthcare insurance companies are already taking action. In June 2023, the Department of Health and Human Services (HHS) announced that several payers had pledged to voluntarily improve the prior authorization process.
Insurance companies, including United Healthcare, Aetna, Cigna, Humana, Blue Cross Blue Shield, and Kaiser Permanente, agreed to:
- Approve at least 80% of all electronic prior authorization requests in real-time by 2027
- Require prior authorizations for fewer claims
- Standardize electronic submissions of prior authorizations
- Honor prior authorizations made within 90 days of a patient changing plans
- Have denied prior authorizations be medically reviewed
- Provide clear explanations about determinations made
It isn’t clear if these changes affect prior authorizations for medications.
While the companies’ actions are voluntary, HHS didn’t rule out potential actions if companies don’t make these changes.
HHS expects additional insurers to agree to these changes. The ideal part for patients and providers is that this initiative, that insurance companies have agreed to apply these changes to commercial plans as well as Medicare.
The upside for patients and providers is that, if insurers meet these metrics, the majority of prior authorizations will be approved virtually immediately.
Electronic Prior Authorization
Effective date: Calendar year 2027
CMS is adding an electronic prior authorization process to its Health Information Exchange (HIE) objective. This change will affect the Merit-Based Incentive Payment System (MIPS) Promoting Interoperability performance category and the Medicare Promoting Interoperability Program. Changes take effect in calendar year 2027.
With this change, MIPS providers will be able to simply check a “yes” to ask for a prior authorization electronically. This will make asking for an authorization very simple. Requests will have to be made using a Prior Authorization API using certified electronic health record technology (CEHRT). Requests can be for one or more medical items or services and exclude medications.
Hospitals, including critical access hospitals (CAHs), will check a “yes” to request a prior authorization. They’ll also have to use a Prior Authorization API and CEHRT data. Prior authorization requests can be for at least one hospital discharge and medical item or service except for drugs.
Note that CMS had already mandated that payers start using Fast Healthcare Interoperability Resources (FHIR) APIs for patient access, provider, access, prior authorization, and payer-to-payer starting January 1, 2026. It also mandates APIs be technically compliant by January 1, 2027.
Rural hospitals, clinics, or providers want to make sure their EHR supports FHIR APIs by that time.
The final rule includes needed standards and implementation specifications.
Monitor Prior Authorization Status with Your EHR
You can manage your hospital or clinic’s prior authorization statuses using most modern EHRs, including Azalea Hospital EHR and Azalea Ambulatory EHR.
With the upcoming CMS rule that requires using APIs, payers will provide prior authorization status, decision dates, and reasons for denials, directly in your EHR so you can have access to complete information and reporting.
Learn more about prior authorizations in 16 Prior Authorization Tips & Tricks for Your Healthcare Facility.
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