CMS Administrator Mehmet Oz stated that physician distrust of insurers is a primary barrier to widespread adoption of real-time (instantaneous) prior authorization technology, despite years of regulatory push toward automation.

This is a candid acknowledgment of a fundamental market failure in healthcare operations. Prior authorization has become a critical pain point for practices: an average prior auth request takes 7-10 business days to resolve, consuming staff time and delaying patient care. CMS and industry groups have invested heavily in promoting instant PA systems (electronic data interchange that returns approvals in minutes), but adoption remains fragmented. Oz's statement reveals why: physicians don't trust insurer AI/algorithms to make clinical decisions faster than current manual review, because insurers have a financial incentive to deny claims. Without transparency into insurer decision logic and historical performance data on denial accuracy, physicians view instant PA as shifting risk to patients through faster denials. The problem is structural, not technological—the tech exists, but the trust doesn't.

For practice owners and DSOs, this underscores that instant PA adoption will remain slow without regulatory intervention forcing transparency and accountability from payers. In the interim, practices should continue investing in PA staff and revenue cycle systems that can handle current turnaround times and should push back on any insurer claims that "instant PA" capability exists when implementation remains manual. More strategically, practices should advocate for CMS regulation requiring payers to disclose instant PA denial rates, appeals success rates, and algorithmic criteria—data that could rebuild physician confidence. Expect CMS to move toward mandated transparency rules in 2026-2027, which will accelerate adoption once trust gaps are addressed through reporting and oversight.

What to watch: CMS rulemaking activity over the next 12 months targeting PA transparency, particularly any proposed regulations requiring payers to disclose denial rates and decision criteria for instant PA systems.