Exclusive: Rural health funds to fix prior authorization
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Illustration: Gabriella Turrisi / Axios
Delaware is using funding from last year's Republican budget law to launch a first-of-its-kind effort to standardize and streamline insurer pre-treatment claims reviews, Axios has learned.
Why it matters: The effort is aimed at cutting down the burden of so-called prior authorizations — and among the early announced uses of the $50 billion rural health transformation fund that lawmakers included in the law.
- The claims reviews help prevent unnecessary health spending but have been widely criticized by patients and doctors for adding red tape and preventing patients from getting timely care.
State of play: The $50 million state initiative will enable providers and payers to exchange information through a digital system using common standards. Smart Health, a small health tech company, will operate the new system.
- With the system, "that rural provider doesn't have to worry about connecting to every payer, to every lab," said Neil Hockstein, chair of the Delaware Health Commission.
Zoom out: Delaware was the only state to explicitly target prior authorization in its application for rural health funding, but many states plan to use funds to improve health data infrastructure. Several including Idaho and Maryland plan to make investments in AI.
- Ohio last week announced a $10 million project to build the rural health workforce with Ohio University. Nevada has issued grants to several communities and clinics to improve rural health infrastructure.
- States have to follow through on passing policy changes outlined in their approved applications by the end of 2027, or their funding could be clawed back.
