Prior authorization has a price tag, and it is larger than most practices have actually priced out.
The 2025 AMA Prior Authorization Physician Survey, released in May 2026, found that physicians now complete an average of 40 prior authorization requests a week, and their practices spend 13 hours a week processing them. Forty percent of practices employ staff whose entire job is chasing PA approvals, and nearly one in three physicians say their requests are often or always denied outright.
That time has a dollar figure attached to it. According to the CAQH Index, the industry’s benchmark for administrative transaction costs, a manual prior authorization costs a provider $10.97 on average. A fully electronic one costs $5.79, less than half. For specialists, the manual figure climbs to $15.12 per transaction, according to CAQH’s provider specialty breakdown, because specialty requests typically need more staff time to compile clinical documentation. Multiply that gap across a specialty practice processing a few hundred PAs a month, and the difference runs into tens of thousands of dollars a year, before counting appeals, resubmissions, or staff turnover.
The 2025 CAQH Index found that electronic transactions and better data exchange helped US healthcare avoid an estimated $258 billion in administrative costs in 2024. Prior authorization still lags behind the rest of the revenue cycle: only 40% of medical PA transactions were fully electronic that year, and CAQH puts the remaining industry-wide savings opportunity at more than $20 billion a year.
That gap is about to matter in a new way. Under CMS’s Interoperability and Prior Authorization Final Rule (CMS-0057-F), impacted payers already have to decide standard requests within 7 calendar days and urgent requests within 72 hours, effective January 1, 2026. By January 1, 2027, those same payers must run a live, FHIR-based Prior Authorization API. Payers still working PA manually on their end will not hit those windows consistently, and providers still faxing and calling on theirs will not benefit even when the payer side improves.
The practices already seeing CAQH-level savings are not the ones waiting for their payers to modernize. They are digitizing intake, tracking status electronically, and reserving staff hours for the complex cases that genuinely need a person’s judgment. That is the calculable payoff of getting ahead of 2027 instead of scrambling to meet it.
