Practice Management Alert

Hint: Don’t forget to keep track of denials so you can troubleshoot your processes.

Healthcare personnel and patients who have to manage prior authorizations tend to find the process tedious and, frequently, a headache.

Keep reading for some solid, actionable tips for getting through the prior authorization process.

Understand the Intention — and the Reality

Imagine if a patient collapsed, and your clinician moves to start CPR, but a team member who does billing yells, “WAIT, this guy has an HMO!” says Melissa Kirshner, CPC, CDEO, CRC, CPC-I, CFPC, COBGC, CEMC, executive director at Olympia Medical LLC, in her session “Front Desk and Prior Authorizations” at AAPC’s 2024 REVCON. “Sometimes that’s how it feels, right? We know the right thing to do, we know what our patient needs. We know the care that we need to provide for our patient, but we can’t, without talking to the insurance company and getting them to approve it. It’s a problem, it’s frustrating.”

Ostensibly, the prior authorization process can be a way to manage resources. “It’s a utilization management tool that’s used by health plans to help manage those costly drugs and costly procedures. It’s a way to decrease spending so that we’re not doing unnecessary tests and unnecessary services. We’re not overutilizing procedures, and [prior authorizations] are really a way to try and help us be good stewards of our healthcare dollars,” she said.

However, from everyone else’s perspective, prior authorizations tend to involve a lot of forms, rejections and resubmissions of paperwork (with a huge reliance on documentation minutiae), and a lot of headaches. Many practitioners report that the prior authorization process lacks transparency, making it even harder to navigate. Some patients’ conditions decline while waiting for their clinician’s practice to cut through the red tape for services.

A physician can request a peer-to-peer review with a provider on the health plan side, but that is an investment of time that takes away from other opportunities, like spending time with patients and providing care, Kirshner noted.

Federal Agencies are Acknowledging the Difficulties

The struggle to get patients the care they need — while also getting paid for the care provided — is not just a figment of healthcare personnel’s imagination. Several federal agencies have been making moves to make the prior authorization process more streamlined and less onerous. The Office of Inspector General (OIG) released a report detailing the denial rates for several Medicare managed care organizations (MCOs) in July 2023. There have been several Congressional hearings about prior authorizations and the snowballing financial and health costs that result from care that is denied due to the process.

These reports have been released in conjunction with some concrete actions that payers, including government payers like Medicare, are taking. A final rule released in February outlines the changes that will be required in the prior authorization process.

The Advancing Interoperability and Improving Prior Authorization Processes final rule “… requires impacted plans to support an electronic prior authorization process that is embedded within physicians’ electronic health records, bringing much-needed automation and efficiency to the current time-consuming, manual workflow,” said Jesse M. Ehrenfeld, MD, MPH, president of the American Medical Association, in a release.

Ehrenfeld also noted that the changes required by the final rule should help boost transparency because payers will need to provide specific reasons prior authorizations are denied and make information about the process more available to patients so they can make more informed decisions.

Ultimately, prior authorization rigamarole won’t be streamlined overnight, so practices that are feeling overburdened should figure out how to work best within the system as it is now.

Pocket These Tips

Kirshner presented tips for managing prior authorizations within these categories: payer requirements, workflow and efficiency, documentation, and follow-up.

One of the most important aspects of managing prior authorizations is knowing the ins and outs of the requirements. Compile a master list of specific payer requirements, including procedures that need prior authorizations, and engage in ways to stay updated, like subscribing to newsletters, and scheduling regular — perhaps quarterly — reviews of the carriers’ websites, newsletters, and bulletins, she said. Make sure you keep this list handy.

Don’t forget that your practice is producing important information, too: If you’re facing prior authorization denials, you should keep track of the reasons and see whether any patterns emerge. Then you’ll have the information you need to course-correct accordingly — if the denials are due to something like consistently insufficient documentation.

It’s also important to maximize efficiency by using available tools, like technology. Make sure your practice designates at least one person as “responsible” for prior authorizations within the practice, Kirshner said. Keep authorizations in a central location and verify insurance and benefits annually — at least.

In many ways, prior authorizations depend upon documentation, so make sure yours is top-notch. Kirshner suggested updating your electronic medical record (EMR) templates to make sure you’re set up to collect the appropriate information, ensure your documentation is complete and up to date, and keep a record of all correspondence and communication with each payer.