Background

In 2022, CMS proposed a new rule aiming to improve the prior authorization process by streamlining requests and sharing healthcare data more readily. The rule was finalized in January 2024, and most provisions of the rule went into effect in 2026.

Under the rule, Medicare Advantage (MA) organizations, state Medicaid and Children's Health Insurance Program (CHIP) fee-for-service programs, Medicaid managed care plans, and CHIP managed care entities are required to send prior authorization decisions within 72 hours for expedited requests and seven calendar days for standard requests. These insurers are also required to automate their prior authorization processes through an electronic prior authorization process programming interface by Jan. 1, 2027.

Insurers are required to justify any denials and publish data on their prior authorization decisions. They are also required to publicly report certain prior authorization metrics, including approval and denial rates, on their websites as of March 31, 2026.

Prior authorization denial rates vary significantly

For the report, KFF analyzed data collected from the websites of MA, Medicaid managed care, and Affordable Care Act (ACA) federally facilitated marketplace insurers. The insurers had at least 2.5% market share of enrollment in their respective market segments. A total of 14 insurers, which represented approximately 71 million enrollees, were included in the analysis.

Overall, KFF found that insurers denied between 12% and 18% of standard prior authorization requests in 2025 across the different market segments. In addition, insurers denied between 10% and 16% of expedited prior authorization requests. MA insurers denied the fewest prior authorization requests while ACA insurers denied the most. 

Although prior authorization denials are rarely appealed, when they are, the denials are often overturned. The share of standard prior authorization requests that were initially denied before being overturned on appeal was 67% for MA insurers, 47% for Medicaid managed care insurers, and 43% for ACA marketplace insurers.

Some insurers overturned more appealed prior authorization denials than others. For MA insurers, Centene overturned appealed denials over 90% of the time; Centene also overturned over half of appealed denials in its ACA marketplace plans. For Medicaid managed care insurers, UnitedHealth Group* overturned 81% of appealed denials.

The median response time for a standard prior authorization request was roughly one day for MA, Medicaid managed care, and ACA insurers, which was substantially faster than the federally required maximum time permitted for standard requests (14 days for MA and Medicaid managed care and 15 days for ACA). The median response time for expedited requests was around half a day for MA insurers, just under one day for Medicaid managed care insurers, and one day for ACA marketplace insurers. 

According to KFF, the median response times likely reflect in part the growing use of technology in the prior authorization process, including AI and electronic prior authorization systems. However, a 2025 KFF poll found that 24% of insured adults reported that their health insurer had delayed their ability to receive a requested healthcare service, treatment, or medication in the last two years. 

KFF also noted that "[f]ederal efforts to increase transparency into prior authorization practices in commercial coverage have so far been limited to ACA plans." Currently, there is no publicly available data on prior authorizations for employer-sponsored plans, which cover the majority of workers. 

Optum Advisory's* Jess Garber and TJ Burdine also expressed similar sentiments, highlighting a need for more data to increase consumers' understanding of the prior authorization process.

"We are not surprised by the significant variation in prior authorization denial rates across insurers," Garber and Burdine said. "The findings echo what we consistently hear from health system clients: Many denials are ultimately overturned and paid after appeal, creating substantial administrative burden and delaying reimbursement."

"While greater transparency through public reporting is a positive step, the data remains difficult to act on due to inconsistent reporting methodologies and limited specificity," they added. "To meaningfully drive improvement and accountability, reported data should be standardized and include more granular detail including service line, denial reason, and appeal outcomes."

*Advisory Board is a subsidiary of Optum, a division of UnitedHealth Group. All Advisory Board research, expert perspectives, and recommendations remain independent.