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Myndshft Blog

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March 30, 2023

Game Changer Alert: Automated Prior Authorization Leaves Electronic Methods in the Dust

by Susan Lawson-Dawson | Prior Authorization

Public payers—Medicare, Medicare Advantage , Medicaid, and the Children’s Health Insurance Program—provide healthcare coverage for members that qualify based on income, age, special needs factors. Private payers like Aetna, Blue Cross Blue Shield, Cigna and hundreds of others offer health insurance coverage through employee-sponsored plans as well as individual plans marketed directly to consumers by individual payers or through the marketplace. And every single one of them uses prior authorization to manage utilization and reduce costs. 

Unfortunately, the current prior authorization process requires a lot of manual effort, sometimes helped along with electronic prior authorization (ePA). But it’s a far cry from what’s possible with fully-automated prior authorization

What makes prior authorization so burdensome? 

Prior authorization began in an attempt to ensure that patients receive the most appropriate and effective treatment for their medical condition, while minimizing the potential for over-utilization and waste in the healthcare system. The reality falls short, instead adding to provider-side administrative expenses and often becoming a barrier within patients’ care journeys. 

As payers have expanded the range of procedures, services and medications subject to PA, the administrative burden for healthcare providers has increased. A survey by the American Medical Association found that 84% of providers reported that the number of PA submissions required has climbed over the last five years. 

In addition, the same survey found that 88% of physicians rate the burden associated with PA as “high” or “extremely high.” The inefficiencies associated with the current, primarily manual process lead to delays which can result in treatment abandonment or worse. The survey also found that 34% of physicians reporting that PA led to a “serious adverse event” for a patient in their care, with 8% saying that PA delays directly contributed to a patient’s disability, defect or death.

Manual prior authorization = repetitive and time-consuming

The most common approach to prior authorization relies on manual data entry. Because requirements vary by payer and policy, determining if a procedure, service or medication needs authorization frequently requires time-consuming efforts. Scouring payer documentation (binders) and  online payer resources (portals), or making phone calls to payers to determine prior authorization requirements and submission criteria takes time, especially if you have to wait on hold to speak with a payer. 

Once a provider establishes that PA is required, the provider must gather and submit required information including patient medical history, clinical diagnosis, and proposed treatment plan to the payer. Relying heavily on repetitive data entry introduces opportunities for errors and missing information which contribute to preventable denials. In turn, the administrative burden for providers climbs as staff must rework prior authorization requests. And meanwhile, patients have a frustrating wait for the care they need. 

Electronic prior authorization removes one hurdle but still falls short

Electronic prior authorization addresses one aspect of data exchange, enabling electronic transmission of information between the provider and payer to determine if prior authorization is granted. It is most widely used for prior authorization related to medications. 

Unfortunately, electronic prior authorization still involves quite a bit of manual intervention on the front end of the transaction. What’s more, the CAQH Index notes that adoption is still relatively low at 26%. The good news? Adoption climbed rapidly in the wake of the pandemic. In 2019, only 13% of providers had implemented electronic prior authorization. The 2020 pandemic accelerated digital adoption in many arenas, including electronic prior authorization.  

Still, data exchange challenges and the lack of uniform standards remain barriers to real value.  

Automated prior authorization solves the biggest challenges

Using automation in combination with a comprehensive payer policy library and rules engine enables a more hands-free experience. 

After entering minimal data, automation takes over. Prior authorization software can move through benefits verification and eligibility, prior authorization requirements determination and prior authorization request submission in a few minutes. In fact, the CAQH analysis estimates that automating from end to end could save 37  minutes or more on. 

Check out this infographic to see how automated prior authorization streamlines the process over both manual and electronic options. 

With a more streamlined process supported by seamless data exchange, providers’ staff and clinicians gain a productivity boost. This, in turn, allows providers to reallocate staff to focus on higher value and more rewarding patient-centric work. Automation also reduces preventable errors, helping to ensure that prior authorization requests get processed more quickly.  Payers, too, realize time efficiencies. For example, auto-adjudication enables payers to bulk approve prior authorizations which reduces administrative work and leads to greater member satisfaction. 

Want to see automated prior authorization in action?  Connect with Myndshft to arrange a demo.