Practices complete an average of 40 prior authorizations per physician each week, according to the AMA 2025 prior authorization physician survey (1,000 physicians, fielded December 2025). Physicians and their staff spend 13 hours a week on those requests. That is more than a day and a half of working time, every week, spent asking payers for permission to treat patients.
The financial damage goes deeper than staff hours. Missing or mismatched authorizations can trigger CARC 197 denials and stall revenue that is already earned. In the same survey, 95% of physicians said prior authorization at least sometimes delays access to necessary care. The problem is structural.
What authorization delays cost
The 2024 CAQH Index (data year 2023) puts the average provider cost of a manual medical prior authorization at $12.88 per transaction. A fully electronic transaction costs providers $5.38. CAQH also reports that providers and staff spend 24 minutes on a request made by phone, fax, or email and 16 minutes using a health plan portal.
The math adds up at volume. For illustration, a five-physician practice at the AMA average of 40 requests per physician per week handles 200 requests a week. If everyone is manual at $12.88, that is about $134,000 a year (200 x $12.88 x 52). The figure excludes revenue lost when authorizations are denied, delayed, or abandoned.
Cost driver | Figure | Source |
Provider cost per manual prior authorization | $12.88 | CAQH 2024 Index (2023 data) |
Provider cost per fully electronic prior authorization | $5.38 | CAQH 2024 Index (2023 data) |
Time per request: phone, fax, or email vs portal | 24 minutes vs 16 minutes | CAQH 2024 Index |
Prior authorizations per physician per week | 40 | AMA 2025 survey |
Physician and staff hours per week on prior authorization | 13 hours | AMA 2025 survey |
Physicians reporting requests are often or always denied | 32% | AMA 2025 survey |
Physicians reporting patients at least sometimes abandon treatment | 79% | AMA 2025 survey |
Physicians reporting a serious adverse event for a patient | 26% | AMA 2025 survey |
5 ways prior authorization delays drain revenue
1. Denied authorizations become denied claims. A claim for a service performed without a valid authorization may be denied under CARC 197. X12 defines that code as precertification, authorization, notification, or pre-treatment absent. The AMA survey found that nearly 1 in 3 physicians (32%) say requests are often or always denied. Each denial triggers a rework cycle, an appeal, or a write-off.
2. Staff time moves away from collections. What happens when billing staff spends 13 hours a week on authorization paperwork? That time does not go to posting payments, working denials, or following up on aging AR. The AMA survey also found that 40% of physicians have staff who work exclusively on prior authorization.
3. Patients walk away from treatment. In the AMA survey, 79% of physicians said authorization issues can at least sometimes lead patients to abandon a recommended course of treatment. An abandoned procedure is lost revenue. The practice has already spent time on the referral, the scheduling, and the authorization request.
4. Authorization denials use up filing and appeal windows. The Medicare timely filing clock runs from the date of service. The CMS Claims Processing Manual requires claims to reach the contractor no later than 12 months after the date of service. An authorization-related denial arrives after the claim is filed, so the rework and appeal time comes out of the same window. Commercial payers set their own limits, so check each contract.
5. Provider time is lost. This cost never shows on a profit and loss statement. In the AMA survey, 94% of physicians said prior authorization somewhat or significantly increases physician burnout. Every peer-to-peer call is time away from billable patient care.
What the CMS-0057-F rule changed in 2026
The CMS Interoperability and Prior Authorization Final Rule CMS-0057-F sets a compliance date of January 1, 2026 for its operational provisions. It applies to Medicare Advantage organizations. It also covers state Medicaid and Children's Health Insurance Program (CHIP) fee-for-service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan (QHP) issuers on the federally facilitated exchanges.
Three operational changes matter to billing teams:
Faster decisions. Impacted payers, excluding QHP issuers on the federal exchanges, must send decisions within 72 hours for expedited requests and seven calendar days for standard requests.
Specific denial reasons. Beginning in 2026, impacted payers must give a specific reason for a denied prior authorization, regardless of how the request was sent.
Public reporting. Impacted payers must post certain prior authorization metrics on their websites each year. The initial set is due March 31, 2026.
The rule excludes prescription drug authorizations. The payer types CMS lists do not include commercial plans outside the federal exchanges. Practices with mostly commercial payers should not assume the seven-day standard applies to them. CMS also requires FHIR-based application programming interfaces (APIs) for prior authorization by January 1, 2027.
Reducing revenue loss from authorization delays
The authorization process will not disappear, but you can control the revenue damage it causes.
Track every authorization from request to decision. Build a log with the request date, payer, CPT code, authorization number, approved provider, expiration date, and response date. If an impacted payer misses the seven-day deadline under CMS-0057-F, document it. That record supports appeals and payer conversations.
Submit requests at scheduling, not at check-in. The earlier the request goes in, the more time you have before the service date.
Match authorization codes to claim codes before submission. An authorization approved for a different CPT code or rendering provider than the claim may lead to a denial. Practices with dedicated medical coding review can catch these mismatches before claims go out.
Automate what you can. CAQH data show a portal request takes 16 minutes against 24 for phone, fax, or email. A fully electronic transaction costs providers $5.38 against $12.88 for a manual one.
Work denied authorizations the same way you work denied claims. Handling both under one accounts receivable management process lets one team see both.
Where prior authorization fits in the revenue cycle
Prior authorization sits between eligibility verification and the visit. It depends on an outside party, the payer, so it needs its own workflow and an owner. The AMA survey found that 40% of physicians already have staff who work exclusively on prior authorization.
A dedicated authorization process, whether in-house or through physician billing services, keeps authorization tracking from competing with check-in, billing, and phone work.
Frequently asked questions
How much does prior authorization cost per transaction?
What is the CMS-0057-F rule?
How many prior authorizations does a typical practice handle?
What happens when a prior authorization is denied?
Do all payers have to follow the seven-day rule?
Can prior authorization be automated?
How do authorization delays affect patient care?
Where to start
Pull your authorization data from the last 90 days. Count how many requests your practice submitted, how many were denied, how long each took to resolve, and how many claims were affected.
Then compare your numbers with the AMA 2025 survey. It found 40 requests per physician per week and 13 hours of physician and staff time. It also found that 32% of physicians say requests are often or always denied.
Medbilling RCM tracks prior authorizations by CPT code, payer, and provider. We match every authorization to its corresponding claim, flag mismatches before submission, and follow up on denials the day they arrive.
