UnitedHealth is Removing More Prior Authorizations, Can Simpler Care Pay Off?

UnitedHealth Group Incorporated's (NYSE: UNH ) insurance unit is removing prior-authorization requirements from a broad range of healthcare services beginning October 1. The changes form part of UnitedHealthcare's plan to eliminate such requirements for 30% of healthcare services by the end of 2026.

The initiative could reduce administrative work for patients, providers, and the insurer itself while improving access to care. However, prior authorization is also one of the tools insurers use to manage healthcare utilization, creating a potential trade-off between a simpler process and greater claims exposure.

The changes cover numerous specialties rather than focusing on one narrow area. UnitedHealthcare (NYSE:UNH) is removing prior-approval requirements for selected services involving cardiology, genetic and laboratory testing, chiropractic care, physical therapy, occupational therapy, speech therapy, orthopedics and musculoskeletal procedures, among others. The reduction will also apply across several types of health coverage, including UnitedHealthcare's commercial plans, Medicare Advantage plans, individual insurance offered under the Affordable Care Act, and certain other plans.

That breadth could make the initiative noticeable to a large group of patients and healthcare providers. Prior authorization requires providers to obtain insurer approval before delivering specified medicines or medical services. Patients and physicians have complained that excessive requirements create paperwork and can delay or prevent necessary care. UnitedHealthcare (NYSE:UNH) said its changes are intended to remove unnecessary administrative work, make information easier to understand, and give patients and providers more time to focus on care. If the reductions produce those outcomes, they could strengthen the insurer's relationships with medical professionals and improve members' experience with its plans.

The company is giving rural healthcare providers additional attention. UnitedHealthcare (NYSE:UNH) plans to begin a rural prior-authorization waiver program on November 1 for eligible rural hospitals and their affiliated providers. It is also accelerating payments by as much as 50% for approximately 1,400 rural hospitals and Critical Access Hospitals during the third quarter. Faster reimbursement could ease administrative pressure on participating providers and support UnitedHealthcare's relationships with hospitals operating in rural communities. Reducing prior authorization may also lower some of the insurer's own processing requirements. Fewer requests could mean less paperwork to review, although UnitedHealthcare (NYSE:UNH) has not quantified any expected administrative savings.