Provider Exemption(s)

The CMS may elect to exempt a hospital OPD provider from PA upon a provider’s demonstration of compliance with Medicare coverage, coding, and payment rules. This exemption would remain in effect until CMS elects to withdraw the exemption. CMS or its contractors would exempt providers that submitted at least 10 requests and achieve a PA provisional affirmation threshold of at least 90 percent during a semiannual assessment. By achieving this percentage of provisional affirmations, the provider would be demonstrating an understanding of the requirements for submitting accurate claims. Notice of an exemption or withdraw of an exemption will be provided at least 60 days prior to the effective date.

Exemption Timeline Example

Hospital outpatient departments can expect the following process:

February 1, 2021- February 28, 2021:

  • MACs calculate the affirmation rate of initial prior authorization requests reviewed September 1, 2020 and after, and notify those providers with an affirmation rate of 90% or greater. Providers will receive a written Notice of Exemption through the US mail or MAC provider portal no later than the first business day on or after March 1, 2021.

March 1, 2021- April 30, 2021:

  • Exempt providers receive 60 days’ notice prior to the beginning of the exemption cycle.

May 1, 2021:

  • The exemption cycle begins for providers who met the compliance rate threshold. Exempt providers should not submit prior authorization requests. Prior Authorization requests receive during an exemption period will be rejected.
  • Providers who did not meet the compliance rate threshold should continue submitting prior authorization requests as usual.

September 30, 2021:

  • Exempt providers will receive a postpayment Additional Document Request (ADR) for a 10-claim sample from the period such providers were exempt to determine continued compliance.
  • Providers have 45 days to submit documentation, and MACs will complete their review within 30 days of receipt of the requested documentation.
  • Providers who submit additional documentation after the initial 45-day response timeframe will not have their compliance rate changed if the MAC has already finalized their compliance rate and sent notification to the provider. The MAC will still review late documentation, issue a review determination, and make a claim adjustment, if necessary. Claim denials are subject to the normal appeals process; however, overturned appeals will not change the provider’s exemption status.

December 17, 2021:

  • No later than December 17, 2021, providers will receive a Notice of Withdrawal of Exemption if they receive less than a 90% claim approval rate during their exemption cycle.

February 16, 2022:

  • Providers who did not meet the 90% claim approval rate will no longer be exempt and may start submitting PARs in advance of the March 1 review cycle.

March 1, 2022:

  • Providers who are not exempt must have an associated PAR for any claim submitted on or after this date.
  • Providers who continue to demonstrate a 90% or greater claim approval rate based upon the 10-claim review will receive a Notice of Exemption and do not need to submit PARs.

For providers who are not exempt, CMS will continue assessing a provider’s compliance through their PAR affirmation rates in March and September of each year. For exempt providers, CMS will continue to evaluate their claim approval rate through ADRs on the subsequent September 30 or April 2.


Prior Authorization for Certain Hospital Outpatient Department (OPD) Services (CMS)

Federal Register


Last Updated Thu, 27 May 2021 15:06:34 +0000