Prior authorization (PA) is the multi-step process by which health care payers require medical providers to request and receive approval before providing certain items, services, or medications. PA is widely used in Medicaid managed care and fee for service. The Commission conducted a study to understand the extent to which states, managed care plans, and providers use automation (i.e., artificial intelligence and algorithms) in the Medicaid PA process and to identify potential policy levers to oversee its use.
This session continued the Commission’s examination of automation in the Medicaid PA process. Staff briefly reviewed key findings from the draft chapter for the June 2026 report to Congress, identifying challenges related to automation in PA and principles for monitoring and overseeing its use. Staff then presented four policy recommendations to address the use of automation in Medicaid PA. The recommendations seek to clarify the role of human oversight in PA and increase transparency into managed care plans’ use of automation in the Medicaid PA process.