In 2022, the General Assembly directed the State Corporation Commission (SCC), in coordination with the Office of the Secretary of Health and Human Resources, to convene a work group to examine electronic prior authorization (ePA) and real-time prescription benefit (RTPB) processes in the private commercial health insurance market.(*1) Several legislative iterations later, the Electronic Prior Authorization Work Group is charged with (i) monitoring the implementation of ePA for medical items and services,(*2) (ii) monitoring and considering options for making the prior authorization process for prescription drugs more prospective; and (iii) considering whether the scope of prior authorization metrics reporting should be expanded to prescription drugs.

The national mandate for impacted payers(*3) to implement ePA in real time, and parallel state requirements for Virginia’s private commercial health insurance market, have driven progress towards the work group’s goal of ensuring payers and providers ultimately operate under a unified and consistent set of technical standards and requirements across both public and private commercial markets for the benefit of patients. One recent survey series by the Workgroup for Electronic Data Interchange (WEDI) shows that progress is being made: countrywide, 45% of payer respondents were 50 to 75% complete in implementing the medical prior authorization API (Application Programming Interface) required by CMS rule by January 1, 2027, up from 6% in an initial 2025 survey.(*4) Usage is also accelerating. One large electronic health records (EHR) vendor reports that medical ePA-related transactions performed for the health systems they serve had jumped from 260,000 in Q4 2023, to 1.145 million in Q1 2025.(*5)

The work group makes several key recommendations:

1. With many of the foundational standards and technologies already or soon to be in place, the work group recommends it continue to evaluate available implementation approaches leveraging the FHIR®-based APIs and distinguish among the underlying interoperability standards, implementation workflows, governance models, and supporting infrastructure, knowing the remaining opportunity lies in stakeholder collaboration around scalable implementation using existing national open standards and existing infrastructure. This could include evaluating the use of a single pathway to process ePA using open standards, non-proprietary software and doing so in real time.

2. The work group recommends that plans and providers evaluate the use of a single pathway to process ePA using open standards, non-proprietary software and do so in real time.

3. For those providers without a more comprehensive alternative to implementing prospective prior authorization, the work group recommends that they consider a phased approach to implementing prospective prior authorization beginning July 1, 2027, starting with frequently prescribed and/or high-cost drugs typically subject to prior authorization, along with a notification and learning process for a specified time period, before recommending any specific compliance measures.

4. The work group recommends that any decision on expanding current prior authorization metrics reporting to include prescription drugs be deferred until its 2027 cycle consistent with its policy goal of aligning state ePA requirements with federal requirements to promote one unified and integrated process across all markets.
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(*1) Chapter 284 of the 2025 Acts of Assembly extended the term of the existing ePA Work Group from November 1, 2025, to November 1, 2028. In 2026, the General Assembly passed legislation recommended in the work group’s 2025 Annual Report revising its charge to require it to consider extending prior authorization metrics reporting to prescription drugs and consider options for making the prescription drug ePA process more prospective and less retrospective.
(*2) The work group charge uses the term “medical items and services" from the Centers for Medicare and Medicaid Services’ (CMS) 2024 Prior Authorization Rule rather than the term “health care services" used in § 38.2-3407.15:8. of the Code (effective January 1, 2027). "Health care services" are defined as having the same meaning as provided in § 38.2-3407.15 of the Code except that as used in § 38.2-3407.15:8, "health care services" do not include drugs that are subject to the requirements of § 38.2-3407.15:2.
(*3) Under the CMS 2024 Prior Authorization Rule, “impacted payers" include Medicare Advantage organizations; managed care organizations, prepaid inpatient health plans, or prepaid ambulatory health plans under contract with a state Medicaid agency; state Medicaid agencies; every state on behalf of its Children's Health Insurance Program; and qualified health plan (QHP) issuers offering a QHP on a federally facilitated exchange.
(*4) Presentation by Robert Tennant, Executive Director, Workgroup for Electronic Data Interchange (WEDI), to the ePA Work Group, Slide 12, June 22, 2026.
(*5) Data provided at the request of the ePA work group by Epic Systems Corporation via email from Tim Stolldorf, August 28, 2026.