Prior Authorization in 2025: Key Trends Shaping the Future of Health Care
Brian Covino, MD, Chief Medical Officer, Cohere Health
Prior authorization (PA) remains one of the most debated aspects of modern health care. Intended to ensure that treatments and services are medically necessary and cost-effective, the process is often criticized for causing administrative burdens, delaying care, and straining the relationships between health care providers and payers. In 2024, PA became a focal point for both regulatory action and technological innovation.
The Centers for Medicare and Medicaid Services (CMS) finalized the Interoperability and Prior Authorization Rule (CMS-0057-F) in January 2024, signaling a major shift in how PA will function in the future. The rule, designed to reduce delays and improve transparency, mandate faster decision-making, streamline data sharing, and enhance interoperability, specifying that certain provisions must be in effect by January 2026. In addition, 13 state-level bills addressing PA reform were enacted throughout 2024, reinforcing the widespread momentum to overhaul the system. These changes reflect an industry-wide recognition of the need to reduce barriers to care while addressing inefficiencies.
With these developments as a backdrop, 2025 is shaping up to be a transformative year for PA. Here are the key trends expected to influence its evolution.
Regulatory Compliance as a Catalyst for Change
As previously mentioned, CMS finalized its Interoperability and Prior Authorization Rule in 2024, mandating faster decision times, greater transparency, and enhanced data sharing by January 2026. In 2025, health plans will need to adopt new technologies that align with these provisions. The result will likely be an increase in interoperability between payers and providers, and reduce delays in care delivery.
The regulatory changes introduced by CMS and individual states are not just bureaucratic hurdles—they are an opportunity to transform PA into a more collaborative, efficient, and patient-focused process. Rather than viewing compliance as a challenge, leading health care organizations see it as a catalyst for broader innovation. By investing in intelligent solutions, they can transform PA from a transactional process into a strategic tool that supports value-based care.
AI Enhancing Provider Experiences
The conversation around AI in health care has shifted from theoretical applications to tangible results. In 2025, AI will play a pivotal role in improving the PA process for both providers and payers. For example, machine learning algorithms are already being used to automate data intake, verify form completeness, and streamline decision-making processes. These advancements significantly reduce the administrative burden on providers, reduce review time and expense for payers, and enable faster access to appropriate care.
Concerning clinical impact, AI-powered decision support tools embedded in electronic health record systems can guide providers toward evidence-based care paths and flag potential errors in PA requests. These tools help expedite approvals, minimize denials, and ensure that requests are supported by complete, accurate data.
Proactive Utilization Forecasting
The ability to forecast utilization trends earlier is a game-changer for payers. In 2025, AI-driven predictive analytics will empower health plans to anticipate utilization trends months earlier than traditional claims-based methods. By analyzing PA data, plans can proactively manage higher-than-expected demand, mitigating financial risks and ensuring adequate resource allocation. For instance, analyzing patterns in PA data can reveal unexpected spikes in demand for specific procedures, such as musculoskeletal surgeries or diagnostic imaging. By acting on these insights, health plans can mitigate financial risks better while reducing provider bottlenecks and improving overall care delivery.
Nudging Care Quality Forward
An exciting development in PA is the use of AI-powered clinical nudges. These real-time recommendations, guided by adherence to medical necessity guidelines, suggest cost-effective, evidence-based care options during the authorization process. This transparency can assist providers in faster approval of appropriate care for their patients.
Consider a scenario where a provider submits a request for a surgical procedure. A clinical nudge might suggest exploring a less invasive, equally effective treatment option first. This approach not only reduces costs but also aligns with evidence-based clinical guidelines, and with the broader goal of improving patient outcomes. By embedding these nudges into the workflow, health care organizations can create a more collaborative relationship between providers and payers while ensuring that patients receive appropriate, high-quality care.
Responsible AI and the Path Forward
As AI becomes more integrated into PA workflows, the importance of responsible use cannot be overstated. This includes designing systems that support, rather than replace, clinical decision-making. Transparent algorithms and physician collaboration will ensure that AI enhances care delivery without compromising trust. The ultimate goal is a touchless authorization process, where routine, evidence-supported requests are automatically approved, freeing providers to focus on patient care.
The Road Ahead
PA is undergoing a significant transformation. With regulatory frameworks driving innovation and AI unlocking new efficiencies, health care organizations are positioned to continue transforming the PA into a process that supports the delivery of timely, high-quality care.
By embracing these changes, health plans and providers can reduce delays, lower administrative burdens, and enhance the overall patient experience. As AI and predictive analytics become integral to PA workflows, the health care industry can move closer to achieving its ultimate goal: aligning payers and providers in the shared mission of improving patient outcomes.
About Author
Dr Brian Covino oversees more than 60 doctors as Cohere Health's chief medical officer. After practicing orthopedic surgery for more than 25 years, Dr Covino joined Cohere Health in 2020 after serving as a consultant since 2018. During his years as a practicing surgeon, Dr Covino was a partner at Knoxville Orthopaedic Clinic/OrthoTennessee specializing in joint replacement surgery. He holds a bachelor's from Harvard University and an MD from Georgetown University School of Medicine. Dr Covino received his surgical training at the University of Virginia Graduate School of Medical Education and completed a fellowship at The Cleveland Clinic Foundation.
