PACS Policy Development & Implementation 3 — Questions and Answers
Question 1: Under NCQA accreditation standards, how often must a health plan conduct a formal review of its prior authorization policies?
- Every 6 months
- Annually (Correct answer)
- Every 2 years
- Every 3 years
Correct answer: Annually
NCQA requires health plans to review and update their UM/PA policies at least annually to ensure they reflect current clinical evidence.
Question 2: Which federal law specifically prohibits prior authorization requirements that create unreasonable barriers for mental health and substance use disorder benefits compared to medical/surgical benefits?
- HIPAA
- The Mental Health Parity and Addiction Equity Act (MHPAEA) (Correct answer)
- The No Surprises Act
- ERISA Section 502
Correct answer: The Mental Health Parity and Addiction Equity Act (MHPAEA)
MHPAEA requires that PA requirements for mental health/SUD services be no more restrictive than those applied to comparable medical/surgical benefits.
Question 3: A PA policy needs to address step therapy (fail-first) requirements. Which statement best represents a compliant step therapy policy?
- Patients must try all generic alternatives before any brand-name drug
- Step therapy requirements must have clinically supported exceptions and override procedures (Correct answer)
- Step therapy applies to all drug classes regardless of clinical urgency
- Providers cannot request step therapy exceptions without specialist referrals
Correct answer: Step therapy requirements must have clinically supported exceptions and override procedures
Compliant step therapy policies must include clear, clinically justified criteria and documented exception/override pathways for appropriate cases.
Question 4: When drafting a PA policy for a high-volume procedure, which format is considered best practice for communicating criteria to providers?
- Narrative paragraphs only
- Structured clinical decision trees or flowcharts (Correct answer)
- Verbal instruction from UM staff
- Confidential internal memos
Correct answer: Structured clinical decision trees or flowcharts
Structured decision trees or flowcharts help providers quickly identify whether authorization is required and what documentation is needed.
Question 5: A state legislature passes a law prohibiting PA for certain cancer screenings. How should a health plan's PA policy team respond?
- File a legal challenge before making changes
- Immediately update the PA list to remove those screenings within the required timeline (Correct answer)
- Apply the law only to new members enrolled after the effective date
- Request a waiver from the state insurance commissioner
Correct answer: Immediately update the PA list to remove those screenings within the required timeline
Health plans must comply with state mandates within required timeframes and update PA policies accordingly to remove newly prohibited requirements.
Question 6: Which of the following is a key difference between a coverage policy and a utilization management guideline?
- Coverage policies describe what is covered; UM guidelines specify the criteria used to authorize appropriate utilization (Correct answer)
- Coverage policies are only for inpatient services; UM guidelines apply to outpatient only
- Coverage policies are developed by providers; UM guidelines are created by members
- Coverage policies require state approval; UM guidelines do not
Correct answer: Coverage policies describe what is covered; UM guidelines specify the criteria used to authorize appropriate utilization
Coverage policies define the scope of covered benefits, while UM/PA guidelines determine the criteria for appropriate and medically necessary use of covered services.
Question 7: During policy implementation, which action helps ensure providers can effectively comply with new PA requirements from day one?
- Retroactive application of the new policy
- Provider education, updated PA forms, and payer portal updates before the effective date (Correct answer)
- Announcing the policy change only through member EOBs
- Requiring providers to self-educate via the payer website
Correct answer: Provider education, updated PA forms, and payer portal updates before the effective date
Proactive provider education, updated submission tools, and portal readiness before implementation ensures smooth adoption of new PA requirements.
PACS Policy Development & Implementation 3
Under NCQA accreditation standards, how often must a health plan conduct a formal review of its prior authorization policies?