Close to 50% Americans get their health care coverage through commercial insurers. Employers reply on these companies to insure their employees, provide care, and administer the benefits. Nearly half of Medicare and Medicaid recipients are enrolled in private MA (Medicare Advantage) plans, an option that is still growing every year. These managed care programs are available almost universally throughout the country.
But there are harbingers of disadvantages to patient access and care within those systems. It has become increasingly apparent that certain commercial plans actually increase costs and restrict care, placing a growing burden on the system. We are going to look specifically at the way in which prior authorization may negatively impact the exact elements the system purports to improve.
Prior Authorization:
With prior authorization, a provider requests, on behalf of a patient, a health plan’s approval before delivering treatment or service. The practice is designed to ensure that the patient qualifies for coverage and payment by the health plan. It is also supposed to make sure that the patient receives optimal care. All health plans should be working toward those goals. But there is growing evidence that prior authorization, required by certain health plans, can actually create delays in care, setting up a danger to patients. They can also contribute to increased health care costs, and even accelerate clinician burnout.
If the tools of prior authorization are inappropriately applied, they can lead to negative impacts on care. Physicians have reported negative clinical impacts, and a significant percent say that serious adverse effects can occur, such as hospitalization or even permanent disability or death. Government agencies have also acknowledged risks that stem from delayed care because of the use of prior authorization requirements.
The delay in necessary treatment that can be an inadvertent result of the misuse of utilization management tools such as prior authorization could lead to higher health care costs as well. There is a burden of extensive approval processes for clinicians that can squander revenue due to overuse of prior authorization. It often triggers an inefficient submission process and can add layers of unnecessary documentation, which can result in denials of coverage and having to reprocess payments.
Care managers are often the ones most affected. Time-consuming documentation from prior authorization requirements over-task the staff and this has shown to be an element in workers leaving the profession. These cumbersome workloads only contribute to staffing shortages.
Numerous examples of this have been cited. Millions are spent by heath care facilities on mandatory requirements for prior authorization. Full-time staff, that would ordinarily not be necessary, are required to keep up with the documentation. These result in added personnel and administrative costs that go directly against a hospitals’ bottom line. Fiscal health is sacrificed alongside patient care. And the reporting obligations are time consuming. Physicians’ offices have reported that they can end up losing two business days every week as staff must spend that time on prior authorization requests.
Other costs come from infrastructure necessities. While patients wait for authorization, they may be using a higher level of health care property than necessary. A patient having to stay in an inpatient situation while awaiting authorization, could have already been appropriately subject to discharge. If insurers do not honor the costs of those extra days, facilities themselves will need to pay those costs.
And when a patient experiences a behavioral health crisis, expensive emergency departments become the option while patients wait for the proper authorization to be transferred to another appropriate facility.
Another driver of the high costs of prior authorization is the variety of methods that insurers require for their prior authorization requests. Supporting documentation, at some insurers, can still be required to be submitted by fax, a cumbersome and outdated transmission solution. While others that use electronic submissions will almost certainly use proprietary portals, requiring staff to learn myriad systems, spend time logging into each one, and be able to extract data from each system while being versed in each system’s distinctive obligations.
The large amount of variation in the processes required for each insurer creates a high possibility of inevitable errors in reporting. If any submission is not properly filed or does not follow complex criteria demanded by the insurer, this will result in claims denials, and/or reprocessing of claims. These are time consuming, expensive, and frustrating outcomes for staff and facilities.
Inappropriate barriers to care should never stand in the way of good patient outcomes. Prior authorization trends can threaten a patient’s access to care. An added shortcoming built into the system is the cost burden which affects the entire system. Regulation and oversight could help mandate a more easily navigable system for all clinicians, and can result in reduced costs, a simplified reporting method, which would all contribute to better patient outcomes.