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Myndshft Blog

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August 8, 2023

Improving Efficiency in Healthcare: How Prior Authorization Software Saves You Time & Resources

by Susan Lawson-Dawson | Healthcare Technology, Prior Authorization

In testimony to Congress several years ago, Harvard Applied Economics professor David M. Cutler, PhD likened administrative costs to an “economic arms race.” He explained that pressure to reduce spending frequently takes the form of payers setting additional administrative requirements like prior authorization to rein in costs. This tactic, however, increases the administrative burden for payers and providers. Ultimately, Cutler suggests, “The net effect is a spiral of cascading administrative costs on both sides of the market, with no benefit to patients and no net benefit to insurers or providers.” And patients are caught in the middle. Enter prior authorization software

Out-of-control administrative burden hurts everyone

In the fast-paced world of healthcare, improving efficiency plays a critical role in providing quality care to patients while managing resources effectively. Unfortunately, the US healthcare system earns the top spot in terms of per capita healthcare spending compared to other nations. 

In fact, Peterson Foundation research suggests that the US spends nearly double the average spend of other OECD countries. What’s more, the US spends 4X more on administrative tasks than other wealthy countries, which is equivalent to the spend on preventive or long-term care. That’s right, we spend as much on paperwork as we do on actually delivering needed care! Is it any wonder that frustration with administrative burdens in healthcare have hit a high? 

Prior authorization software eliminates complexities, relieves burden

Reducing the burden of prior authorization remains a priority for providers. Even Congress and the Centers for Medicare and Medicaid have prior authorization reforms queued up. But such reforms move at a snail’s pace. If you want to tackle inefficiencies in your benefits verification and prior authorization process now, you have a powerful tool at your disposal: prior authorization software. Implementing automated prior authorization significantly enhances efficiency in healthcare, saving both time and resources.

The traditional prior authorization process requires providers to navigate a sea of paperwork, phone calls, and faxes. Adopting prior authorization software, however, streamlines the cumbersome process. The software automates many tasks, such as eligibility verification, prior authorization requirements determination, pre-checking prior authorization submissions for preventable errors, and monitoring the status of prior authorization requests. In turn, this frees up valuable human resources, allowing you to re-allocate staff to more rewarding, higher value taste. Let’s dig into what this looks like. 

Real-Time Eligibility Verification

One significant advantage of prior authorization software rests with the ability to perform real-time eligibility verification for 94% of U.S. covered patients. You gain almost instant access to accurate co-insurance, copay, deductible, and other plan details from payers, nationwide.

Patient Financial Responsibility Calculation

While cost transparency has improved as a result of numerous rules and regulations related to “surprise billing,” many patients still don’t know the cost of medical services until they receive a bill—and that can lead to payment delays. A 2022 Consumer Sentiment survey found that 83% of healthcare consumers want an accurate estimate of out-of-pocket costs in advance. In addition, the survey also found that 25% of healthcare consumers avoid getting care due to a lack of price transparency. Therefore, an accurate calculation of patient financial responsibility can have a positive impact on both patient experiences AND your revenue cycle. 

Automated Prior Authorization

The intent of prior authorization—to manage utilization to reduce costs while ensuring appropriate care for members—is undermined by the fact that it remains one of the most costly and time-consuming transactions to conduct. Prior authorization software puts an end to frustrating scavenger hunts for requirements, forms, and attachments related to a request. It combines hands-free automation with Collective Healthcare Intelligence—a single source of truth for patients’ health and benefits information, providers’ clinical documentation, and payers’ plans and policies. The software automatically determines if a prior authorization is required, pre-screens the submission for errors and medical necessity, and submits it directly to the payer using the payer’s preferred submission method. Plus, you can easily monitor the status of all prior authorization requests in one convenient dashboard instead of making dozens of phone calls to various payers or visits to payer portals to determine status. 

Payers can benefit from prior authorization software too

Better communication supports faster decisions by payers. For instance, because prior authorization software pre-checks submissions, payers receive prior authorization requests that provide the right level of detail. This reduces back-and-forth delays, accelerates the approval process and ultimately saves valuable time and resources for all parties involved. In addition, clinical decision support offers immediate, medical policy-based recommendation to approve or reject PA requests which further reduces processing time while ensuring decisions meet payer standards. 

Prior authorization software can have a positive impact on the financial performance of both provider and payer organizations. By reducing administrative overhead and streamlining the prior authorization process, providers can allocate resources more efficiently, leading to cost savings. Additionally, the software helps identify insurance coverage limitations and facilitates the selection of alternative treatments, optimizing reimbursement and minimizing claim denials. Similarly, payers realize financial benefits from a more efficient process. Plus, with more regulations coming down the pike, prior authorization software that already meets current and future requirements offers a solution to compliance concerns. 

Efficiency is a critical factor in delivering quality healthcare services while maximizing the utilization of resources. By implementing automated prior authorization, you can save valuable time and resources, allowing you to focus on what matters most: providing exceptional care to patients. Embracing technology and leveraging prior authorization software is a proactive step towards a more efficient and patient-centered healthcare system.

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