FAQ: What UnitedHealthcare’s prior authorization changes could ignite for the industry

UnitedHealthcare’s recent decision to eliminate prior authorization requirements for some services comes as insurers across the industry face growing pressure from patients, physicians and regulators to simplify the process and reduce administrative burden.

The insurer announced last week that it plans to eliminate prior authorization requirements for about 30% of services that currently require approval, including select outpatient surgeries, diagnostic tests and therapies. The move follows broader industry commitments from some organizations including America’s Health Insurance Plans (AHIP) and the Blue Cross Blue Shield Association to reduce prior authorization requirements and improve electronic processing.

Here’s what managed care leaders should know.

Insurers are facing continued criticism from physicians, patients and policymakers over delays in care and administrative burden tied to prior authorization.

Larry Levitt, executive vice president for health policy at KFF, told Managed Healthcare Executive that “all major insurers are looking for ways to cut back on prior authorization or streamline the process in response to the backlash among patients and providers.”

Levitt said UnitedHealthcare’s size makes the announcement especially notable because it is the nation’s largest health insurer.

A KFF polling released in February highlights the extent of frustration among patients. The survey revealed that 32% of insured adults said prior authorization requirements were a “major burden,” making it the top challenge people identified when navigating the healthcare system. Among adults with chronic conditions requiring ongoing treatment, 39% said prior authorization was the single biggest burden they faced in accessing care.

The same survey found that nearly half of insured adults reported that care, treatment or medications had been delayed, denied or altered by their insurer within the past two years.

Yes. An AHIP spokesperson shared in a statement with MHE that participating health plans have reduced prior authorization requirements by 11% overall since making voluntary commitments to streamline the process. According to the organization, that represents about 6.5 million fewer prior authorizations for patients.

AHIP also said participating plans are working toward standardized electronic prior authorization submissions and real-time approvals for many services. The organization said it expects 80% of electronic prior authorization approvals to receive real-time responses by next year.

The organization added that the industry is focused on “faster answers for patients, a more consistent experience for providers, less friction, elimination of manual processes” and broader adoption of electronic data sharing.

The organization added that more than 257 million covered lives are represented by plans participating in the voluntary commitments.

Levitt said some uncertainty remains because the changes are voluntary and not tied to federal regulation.

“Voluntary efforts by insurers to limit prior authorization will be welcomed by patients, but there’s no guarantee they’ll last in the absence of regulation,” he said.

The issue has drawn increasing scrutiny from lawmakers and regulators in recent years, particularly in Medicare Advantage, where providers and physician organizations have raised concerns about delays and denials tied to utilization management practices.

Health plans continue to describe prior authorization as a tool for managing inappropriate or low-value care while balancing affordability and patient safety.

AHIP said prior authorization is used for a limited set of services, primarily in areas with “significant practice variation or risk of inappropriate care.” The organization said the process helps ensure treatments align with evidence-based clinical guidelines while helping control healthcare costs.

At the same time, Levitt suggested that some prior authorization requirements could create more administrative burden than financial savings.

“The fact that insurers are willing to limit prior authorization voluntarily suggests these denials may not be saving much money in the end, while creating administrative costs and hassles,” he added.

For providers, the changes could help reduce paperwork and speed access to some services, though physician groups including the American Medical Association (AMA) have continued to argue that prior authorization remains a major administrative burden despite recent insurer commitments.

Industry observers will likely continue watching whether additional insurers announce similar reductions, how quickly electronic prior authorization systems expand and whether federal regulators pursue additional oversight.

Levitt said KFF polling suggests patient frustration with prior authorization remains widespread across employer-sponsored coverage, Medicaid and Affordable Care Act marketplace plans, making the issue difficult for insurers to ignore as pressure continues to build around healthcare access and administrative complexity.

This FAQ was reviewed for accuracy by Levitt before publishing.