The cost of waiting: AI and interoperability driving prior authorization efficiency

A physician submits a prior authorization request for a patient recovering from a cardiac procedure. A routine ECG is needed—standard follow-up care to monitor for arrhythmias that, if missed, can escalate quietly but quickly. She attaches the clinical notes, enters the diagnosis codes, and submits the request through the hospital system. To the physician, the task is complete. To the patient, care should now proceed.

On the payer’s side, the same request arrives very differently. Key fields fail to align with the expected data structure. Clinical rationale is embedded in free text or locked inside a non-searchable PDF. Nothing is technically wrong, yet nothing can move forward. The request is not denied. It is not approved. It is paused—held in a digital waiting state created by two organizations operating on systems that were never built to communicate cleanly with one another.

This breakdown is often framed as a technical interoperability failure. In reality, it is also a product of how payer and provider systems evolved—and why.

Provider platforms were designed to support clinical documentation, coding, and reimbursement, often in the service of maximizing revenue in a fee-for-service environment. Payer platforms, by contrast, were built to manage utilization, control costs, and enforce policy compliance. These systems did not merely grow apart; they grew in opposition. Over time, mistrust became embedded not just in organizational culture, but in software design. Documentation is produced to justify care. Intake and review workflows are engineered to challenge it.

When clinical data arrives in formats that cannot be easily structured, validated, or reconciled with policy logic, the system’s safest response is to stop. Waiting becomes a risk-management mechanism.

The consequences are well known across the industry. Prior authorization requests flow through a patchwork of channels—faxed forms, PDFs, portals, phone calls, and partially electronic feeds—each using different formats and assumptions. Even when data is technically electronic, it is often not standardized enough to be trusted by default. Requests are returned not because care lacks medical necessity, but because the information cannot be confidently interpreted. Delays follow. Resubmissions increase. Clinicians absorb the burden through repeated follow-ups and after-hours administrative work, while patients experience uncertainty and deferred care.

As medical cost trends continue to rise, these delays are no longer operational nuisances. They represent growing clinical, financial, and reputational risk for both payers and providers.

It is this structural interoperability gap—rooted in fragmented data exchange and decades of misaligned system design—that the CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F) seeks to address. By mandating standardized, FHIR-based electronic exchange, CMS shifts prior authorization from a system built on assumption and friction to one grounded in shared structure and transparency. In doing so, the rule establishes not just a compliance requirement, but the foundation for rebuilding trust across the authorization lifecycle.

Why the CMS Interoperability rule matters in prior authorization

The CMS Interoperability and Prior Authorization Rule introduces a clear path out of today’s fragmented ecosystem by mandating the use of FHIR-based APIs for submitting requests, attaching clinical documentation, checking status, and receiving decisions. This shift matters because it replaces the inconsistent channels providers rely on today with a single, structured, machine-readable framework.

Under the rule, payer platforms must accept standardized data, and provider EHRs must be able to exchange that data through consistent, interoperable interfaces. For the first time, regulation directly addresses the root problem, which is the disconnect between how providers send information and how payers process it. By enforcing structured, electronic exchange, CMS lays the foundation for faster decisions, clearer communication, and a more transparent authorization experience for all stakeholders.

Building the FHIR-based foundation for prior authorization

By eliminating manual submissions and unstructured documents, FHIR-based exchange enables information to move securely, consistently, and automatically between stakeholders. Providers gain timely visibility into payer determinations, while payers receive complete and structured data that accelerates adjudication and strengthens audit readiness.

In essence, the regulation addresses the industry’s biggest challenge: the absence of seamless, real-time data exchange between two independent entities.

Moving toward connected orchestration

The 2027 guidelines envision a prior authorization process where intake, decisions, and status updates flow seamlessly across clinicians, utilization management teams, and even patients through interoperable interfaces. Instead of isolated steps, authorization becomes a continuous, coordinated experience.

Real-time data exchange enables clinical, claims, and administrative workflows to stay aligned, thereby reducing the back-and-forth that often slows down decision-making today. Information arrives more accurately, requests move with fewer interruptions, and members experience faster, more predictable care pathways. This shift represents the evolution from basic digitization to true operational connectedness.

From compliance to operational maturity

Digitizing documentation and submission workflows are only the foundation. As organizations reach higher operational maturity, they can begin incorporating AI and genAI to reformat, reconcile, and interpret provider data automatically, eliminating one of the most persistent causes of delay in the authorization lifecycle.

Today, a request submitted in the wrong structure is simply returned, often accounting for up to 80% of processing delays. In an AI-enabled environment, the system can translate provider data from its original format into the payer’s required structure, interpret clinical intent despite variations in terminology, and surface only exceptional cases for human review. The result is an authorization pipeline that moves with greater accuracy, speed, and self-correction, turning compliance into true operational efficiency.

How agentic AI can accelerate prior authorization workflows?

Beyond formatting corrections, AI can enrich each request with relevant clinical history stored in payer systems. For example, a provider may submit only minimal information for an ECG, but an AI engine can automatically surface relevant context, such as recent cardiac surgery, diagnostic imaging, chronic conditions, or prior authorizations before the reviewer even opens the case.

This enrichment prevents duplicate tests, accelerates approvals, and equips clinical reviewers with a complete picture from the outset. Review times shrink from 30–60 minutes to under a minute, because context arrives pre-assembled.

This is not about AI replacing human decision-making; it is about AI organizing, validating, and augmenting data so that humans can make faster and safer decisions.

Engineering the AI-ready compliance foundation

To support interoperability at scale, many organizations are moving toward clearinghouse-style models that centralize provider submissions. Platforms like Availity already serve as intermediaries between provider EHRs and payer systems, and as they adopt FHIR APIs alongside AI-driven normalization and automated data interpretation, they will significantly reduce friction across the authorization journey.

Organizations that adopt interoperable architectures and intelligent workflows early are already realizing measurable gains: shorter turnaround times, fewer manual corrections, stronger audit readiness, and lower denial rates. Virtusa’s end-to-end transformation of inpatient precertification modernized legacy workflows and integrated multiple systems to streamline admissions, improving admission time, satisfaction, and operational efficiency. This example shows how workflow modernization and system integration drive these outcomes. The imperative now is to audit existing intake pipelines and architect a FHIR-based foundation that supports AI-driven intelligence. That is the next phase of modernization.

Looking ahead

The future of prior authorization will be shaped by two essential pillars: strong interoperability and intelligent automation. CMS has set the direction, and AI and genAI now offer the acceleration needed to realize it. Organizations that align early with these standards and adopt AI-enabled data exchange will be positioned to deliver faster authorizations, lower administrative burdens, and more seamless provider experiences—all while improving outcomes for members.

Each advancement brings the industry closer to a model where compliance, intelligence, interoperability, and care delivery operate as a coordinated whole.