Practice Management Alert

Save time and reduce frustration with 5 key strategies.

If you want to make a medical professional angry, just say two magic words: “prior authorization.” This cost-containment measure implemented by insurers drains time and energy from physicians and their staff, confuses patients, and often conflicts with the best course of treatment.

Prior authorization “creates huge administrative burdens on practices, increasing the cost of delivering healthcare,” Rhonda Buckholtz, VP of Strategic Development for Eye Care Leaders, said to Practice Management Alert.

The need to get an increasing number of prescriptions and procedures approved in advance of treatment is a familiar frustration for doctors. “When I started out it never came up,” Kevin de Regnier, an osteopath who has practiced in Iowa for more than 25 years, told Medical Economics. “Then we started seeing it in a small number of high-dollar medications, then it expanded into more and more branded medications, and then moved into getting procedural prior authorizations, especially in the radiology field. Now you’ve got to prior auth for every procedure and every referral, even referrals for physical therapy.”

“Prior Auth” Trend Accelerates

If it feels like you’re the only physician or practice manager who spends more and more of your day on the phone justifying procedures and medications, rest assured: you’re not alone. In 2016, the American Medical Association conducted a survey of member physicians to assess their prior authorization experience.

The results were striking: A full 75 percent of respondents called their administrative burden high. No wonder, when they averaged 37 prior authorization requests per week, with an estimated 16 hours spent weekly on those requests. As a result, one third of the physicians hired a staff member whose only job was handling prior authorizations.

“Because of the number of things that authorizations are being required for, I know an eight-doctor group that has a staff member who spends 80 percent of their time just doing prior authorization for tests,” Jill Young of Young Medical Consulting told Practice Management Alert.

An added frustration: Increasing insurer requirements don’t come with better insurer personnel. “It’s hard enough for the doctors’ offices to find people who know what they’re doing,” says Young. “But for the insurance companies to find experienced people is almost impossible. So often the person you’re talking to at the insurance company just has a script for prior authorization, and if you go outside their script, they don’t know what to do.”

Cut Through the Prior Authorization Clutter

Despite the pain of prior authorization, your practice can take concrete steps to make the process more efficient.

1. Put the right person in charge. “Don’t have your least experienced person handle prior authorization,” warns Young. “They have to be savvy.” It isn’t a task for your newest employee, even if it might seem like mindless work at times. An experienced hand can drastically speed up prior authorization.

2. Embrace newer technology. Many prior authorizations are still done by telephone or fax, even as more and more business is conducted online-only. Whenever possible, says California-based medical consultant Judy Bee, use the payer’s website for all prior authorization requests. This completely eliminates the dreaded wait time on hold that is the bane of every medical practice. Even if using the online option only slightly reduces the time needed to hear back from an insurer, it saves hours of dead time on the telephone.

3. Reassess your insurers. A more drastic step calls for cutting out troublesome insurers entirely. “If you have a plan that is ho-hum in its reimbursement and is requiring a lot of time (to approve prior authorizations), you probably should rethink whether you need to participate, because that’s coming right out of your wallet,” said Bee to Medical Economics. Consider examining your books to determine which insurers demand the most prior authorizations (or take the longest to respond to your requests) – it might make more sense to stop accepting those plans than to deal with the headaches they create.

4. Centralize staffing. If your practice contains multiple offices or locations, you might be able to take advantage of your scale by designating an employee or two to handle all prior authorizations. Not only will this centralized system help you cut down on redundant staffing, says consultant Owen Dahl, but your prior authorization staffers will get to know the insurers well and become true experts in this difficult process.

5. Negotiate. You may be able to work out special pre-approval deals with insurers to circumvent prior authorization. “Tell the payer that if the patient presents with this disease, this is what we will do,” Dahl said to Medical Economics. “Can we get blanket approval for this without having to call every time for authorization if the patient needs a procedure under this treatment plan?” Creating condition-specific plans of care in advance lets you do what you do best: treating your patients, not waiting for the go-ahead from a far-off insurer.