Prior Authorizations: Minimizing the Impact on Patients

Over the past several decades, healthcare payers have tried many different strategies to mitigate rising healthcare costs. In the 1960s, payers introduced utilization review (UR), a process designed to reduce hospital resource overutilization and curb waste. The goal was to verify the need for hospital admission based on a confirmed diagnosis. Originally performed by nurses in the hospital setting, UR gained traction in the outpatient setting as a way for health plans to reduce cost and overutilization. Over the years, the UR process gradually evolved into the current prior authorization (PA) process. In addition to verifying the necessity of inpatient admission, a health plan uses PA to determine if a recommended outpatient procedure, therapy, or medication is appropriate and reimbursable. 

While the process has become more streamlined, the American Hospital Association notes that obtaining PA requires a significant investment of provider and staff time. The submission process often varies from payer to payer, leaving providers unsure about what information to submit. The American College of Physicians (ACP) identifies PA as “one of the most onerous administrative burdens that physicians face, forcing them to divert significant amounts of time and focus away from patient care.” 

PA requirements can also negatively impact patient care. According to a recent American Medical Association (AMA) physician survey, patients whose treatment require PA experience delays in access to needed care 94% of the time. Nearly 1 in 4 physicians reported that PA had led to a serious adverse patient care event, and 78% of surveyed physicians felt that PA can result in a patient deciding to abandon treatment. 

The AMA, state medical societies, and other stakeholders have advocated to reduce care delays and administrative burden resulting from PA requirements. Since January 2024, those efforts have prompted several states to pass legislation cutting the volume of PAs required by payers in an effort to reduce patient care delays and increase transparency about PA requirements. Beginning in 2026, the Centers for Medicare & Medicaid Services (CMS) will implement new rules to streamline the PA process in the payer programs that it oversees. 

As these rules and regulations continue to evolve, it is important to minimize the impact that PA has on the patient resulting from administrative delay, inaction, or denials. Efficient PA management requires implementing a comprehensive tracking system and sound policies and procedures to ensure patients get the care they need. Consider the following when examining your organization’s PA process: 

• Know the law. Laws regarding PA vary from state to state and evolve rapidly. Work with an attorney to understand federal and state law as applicable to PAs and ensure that your policies and procedures reflect current law.
• Develop policies and procedures. Develop a process for managing PA that addresses key elements. Include: 
  • Guidelines and resources for determining specific submission requirements for each payer contracted with your organization.
  • Specifics on how to process PAs, what materials to submit, and the time frame in which to complete PA tasks.
  • Information on the time frame and process for addressing scenario-specific denials, such as requests for additional information, exclusion decisions, out-of-network issues, or requests for peer-to-peer review.
  • Guidance and clarity on closing the PA process communication loop, such as verification and documentation that the PA has been received, and referrals have been made.
  • Expectations regarding PA documentation and communication with other care team members and patients.
• Implement a tracking system. Adherence to time deadlines and quick response are crucial in the PA process. A well-designed tracking system can minimize patient care delays and/or alert a provider to a necessary change in the treatment plan. Develop a method to track prior authorizations as they move through the process so that follow-up requests and denials can be addressed in a timely fashion. 
• Communicate. Regularly communicate the PA status to the requesting provider so that they can keep abreast of the situation and change the treatment plan if needed. Ensure the patient is kept in the loop regarding the PA request’s status and that they understand when to notify the provider if they experience a change in their condition while awaiting the results.
• Monitor incoming faxes. Ensure that all incoming documentation, including faxes, are reviewed regularly by staff members who are trained to recognize and prioritize PA denials and returns and route them appropriately.
• Address denials. If PA is denied despite submission of the required/requested information, consider reevaluating the PA request or reviewing the patient chart to determine if additional documentation, clinical information, or testing may be helpful. If so, provide that information in a timely fashion. If not, discuss other treatment options with the patient.
• Explore options. After all attempts to obtain PA have failed, consider other options to assist the patient in getting necessary treatment. Many hospitals and community healthcare organizations have dedicated staff (community healthcare workers or community healthcare coordinators) who are trained to help uninsured patients locate healthcare funding and/or community resources. Some healthcare corporations, such as pharmaceutical companies, offer financial assistance programs that can defray treatment costs or reduce out-of-pocket expenses. Know the resources that are available in your community and how to connect patients with them. 
• Document. As the PA request moves through the process, ensure that your documentation reflects essential elements such as the information that was submitted in support of the PA request, when the information was submitted, and all communications that you had with the patient and/or payer representative regarding PA. If PA is denied, document all conversations you have with the patient about the denial, recommended changes in treatment plan and all steps taken to help the patient get the necessary care.  

Navigating the PA process can be difficult. Well-crafted policies and procedures, a sound tracking system, and creative problem-solving can help patients get the care they need and reduce the administrative burden on providers.