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What the proposal would do
CMS released a proposed rule on April 10, published in the Federal Register today, that extends its earlier prior authorization reforms to drugs. The 2024 interoperability rule set electronic prior authorization and decision timelines for medical items and services but left drugs out. The new proposal would close that gap for Medicare Advantage organizations, Medicaid and CHIP programs and managed care plans, and qualified health plans on the federal exchanges.
Plans would have to support electronic prior authorization for all drugs that require it. Drugs covered under the medical benefit would run through the same standards-based Prior Authorization API required by the 2024 rule, while pharmacy-benefit drugs would use existing retail pharmacy standards. Plans would also have to give a specific reason when they deny a drug request, make status and decisions visible through patient and provider data exchanges, and publicly report more prior authorization metrics. Most of the drug requirements would take effect Oct. 1, 2027.
In a separate proposal, HHS would adopt newer data standards for prior authorization and eligibility transactions, replacing the long-standing X12 278 transaction for those uses. That change would apply to HIPAA covered entities, including providers, two years after a final rule takes effect.
Why hospitals should pay attention
CMS states that the payer requirements would not directly regulate providers. In practice, hospitals benefit only if their own systems can send and receive these electronic requests. Drug authorizations are a frequent cause of delays for infusion therapy, oncology and specialty pharmacy, and they tie up pharmacists, nurses and access staff on phone calls and portals.
The timing also matters. The 2024 rule requires plans to have the Prior Authorization API for medical services in place by Jan. 1, 2027. A hospital that plans its electronic health record upgrades and vendor work for that date can fold drug workflows into the same effort instead of starting over later.
Next steps
- Inventory the pain: Measure how many drug prior authorizations you handle, how long they take and which plans cause the most delays.
- Talk to your vendors: Ask your electronic health record and pharmacy system vendors for a timeline to support these standards.
- Use the data: Plan to use payers’ public prior authorization metrics in contract talks.
- Comment: Comments are due June 15. Share specific examples of how drug authorization delays affect patients.
Archive entry for Apr 14, 2026, added Nov. 11, 2026.
Sources
- Interoperability standards and prior authorization for drugs, proposed rule (Federal Register, Apr 14, 2026)
- CMS releases proposed rule establishing electronic standards for drug prior authorizations (AHA News, Apr 10, 2026)
- Advancing interoperability and improving prior authorization processes, final rule (Federal Register, Feb 8, 2024)