Precarious Problems with Prior Authorizations

Posted in GeBBS Healthcare Solutions, Inc.

Patients and providers alike suffer the pain and financial implications of prior authorizations, also referred to as prior approval, pre-authorizations, or pre-certifications. A red tape-laden approval process required by government and commercial payers, prior authorizations are often required for numerous treatment options such as hospital admissions, procedures, surgeries, diagnostic testing, imaging services, therapies, and even certain medications. Hours upon hours and full-time staff are dedicated to communicating between managed care companies and providers to get a single treatment approved.

A process that was initially designed to reduce healthcare costs has failed miserably and providers and healthcare organizations are paying the price. The American Medical Association has been vocal about their discontent with prior authorization stating the process “is overused and [that] existing processes present significant administrative and clinical concerns.” Other specialty groups have spoken out as well with hundreds of professional organizations reaching out to lawmakers in pursuit of reform – particularly for Medicare Advantage plans.

A survey conducted by a prominent Healthcare University System of nearly 60 providers to identify sources of satisfaction and dissatisfaction related to administrative tasks in the outpatient setting, and the topic of prior authorizations came up numerous times with comments such as “It’s a financial burden…” The report highlighted that problems with prior authorizations include: the coordination required across multiple communication channels, variations in process amongst payers, and frustrating peer-to-peer review processes just to get patients the care they need.  Some physicians have simply given up altogether, commenting, “If it gets to the point where they want peer-to-peer discussion about [the medication I prescribed], I’m not wasting my time anymore. I’ll call the patient and tell them insurance doesn’t want to cover it.”

Another study conducted by the AMA (American Medical Association)articles that more than 25% of physicians surveyed reported that prior authorization has led to serious adverse events like hospitalization and permanent bodily damage, while 91% of respondents said the prior authorization process routinely leads to delays in treatment.

It’s clear to see how patient care can be impacted when people aren’t getting the medications or treatments, they need due to delays obtaining required pre-authorization. While certain payers agreed to make improvements to the process in response to the AMA’s outcry several years ago, little progress has been made to date. Dr. Susan Bailer, president of the AMA was recently quoted saying “The health insurance industry’s failure to achieve agreed-upon improvements illustrates a clear need for legislation.”

 Combating the Perils of Prior Authorization

On the financial side of things, history tells us that a significant percentage of denials are due to problems related to prior authorization and medical necessity – which can lead to millions of dollars in lost revenue and/or employee and administrative costs and the time required to appeal the denials.

Until progress can be made to simplify and streamline the prior authorization process, what can organizations do? Here are a few tips to help busy organizations avoid some of the perils related to the prior authorization process.

  • Triage Current Processes:
    • Accuracy – The more accurate and precise the information provided to payers, the more accurate the reimbursement of services
    • Turnaround Times – Authorizations and follow-up within 48 hours is imperative, as the faster approvals are obtained, the faster patient care can ensue
    • Peer Review Process – Evaluating and implementing quality standards and performance measures will ensure better outcomes
    • Clear and Concise Communication – With the patient experience at top of mind, communication around treatment plans and associated authorizations will set expectations early in the process and will enhance patient satisfaction
  • Go Digital: Transitioning to electronic processes can save time and money. Estimates indicate that manual pre-authorization processes can cost more than 3x than handling them electronically. Electronic prior authorization (ePA) software can automate the process and reduce the administrative burden on busy practices and health systems. If you use a practice management software, setting up alerts and links to required forms can help save time.
  • Be Payer Smart and Savvy: Prior authorization requirements will vary widely among payers. Knowing the requirements prior to delivering care or sending prescriptions can reduce problems, save time, and streamline treatment. Keeping employees well-trained and current on updates and changes and ensuring reference information is readily available is key, including your payers’ formularies and the medications they cover as well as your payers’ most common authorization requests. Finally, the AMA recommends monitoring payer newsletters and websites frequently for updates on prior authorizations.
  • Get Centralized: While prior authorizations can be a complex process to navigate, practice makes perfect and it’s not a process that’s best left to providers and clinic staff who have a wide range of other responsibilities. That’s why centralizing your operations for prior authorizations to dedicated individuals or a specific team can help hardwire efficiencies into your process – and leave providers and caregivers to focus on patient care.

 GeBBS’ dedicated patient contact service experts combined with a team of staffed RNs substantially reduce turnaround times for insurance eligibility and pre-authorization approvals while significantly improving collection outcomes, accuracy of resolution and overall patient satisfaction. To learn more visit: www.gebbs.com

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