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Why Prior Authorizations are Important

Why Prior Authorizations are Important in Medical Billing

Prior authorizations (PA) or “Preauthorization” is the process of getting an agreement from the payer to cover specific services before the service is performed.

When to Obtain Prior Authorizations

Some insurance plans require that a patient receives preauthorization from the insurance company prior to receiving certain medical services to confirm they are covered and medically necessary. Be sure to check if PA is required BEFORE the service has been rendered. Most insurances that require PA, give you 24 hours after the service is rendered-longer if the service qualifies as “emergency”.Prior authorizations are typically needed for:
·         Planned inpatient admissions
·         Certain behavioral health services
·         Certain prescriptions
·         Rehabilitation therapies
·         Home health services
·         Pain management
·         Complementary & Alternative Health Services
·         Medical Equipment
·         Certain counseling services

How to get Prior Authorizations

Most insurances allow you to submit PA requests via their provider portal.

  1. First, check the plan’s policy to understand if the treatment or service requires a PA. This can be found via the plan’s website or by contacting the provider service line of the policy.
  2. If PA is required, ensure that the PA request will follow the plan’s guidelines and double-check that you meet all requirements before submission. (Requirements could include a specific number of follow-ups before the service is approved.)
  3. Obtain any required PA documentation such as office notes, labs, ultrasounds, etc. Be sure the records you send with your submission support the reason for the visit or procedure being requested. Once the PA is submitted, the insurance company may approve, deny, or further medical review required.

APPROVED: The patient will be able to receive the requested treatment or service.

DENIED: Find the specific reason for the denial, this should be in the denial letter or notification. If denied for an administrative reason, such as: “lack of documentation”, be sure to restart a new request with records attached. If denied for a clinical reason, such as: “not medically necessary”, report this information to the doctor or nurse.

NEED MORE INFORMATION: Contact the insurance and speak with the nurse to answer any questions they may have regarding the service. Sometimes the nurse with the insurance company will request to speak with the Doctor. PLEASE NOTE: AUTHORIZATION IS NOT A GUARANTEE OF BENEFITS OR PAYMENT.

Quick PA Tip: It’s significant to have a pleasant attitude when talking with the service member to ensure the process goes smoothly.

Should you Follow up on Prior Authorizations?

Yes! You should always follow-up on PA’s and you should follow up consistently.

Be sure the Doctor has not changed his/her procedure or treatment plan. This would require you to contact the insurance to change the CPT code, if necessary. If not done in a timely manner, the claim will deny for “no auth obtained” or “not medically necessary. “Be sure to track your requests and follow-up to prevent delays or denials that often occur. It is best to create a reminder system that can be easily implemented into the billing departments’ daily workflow.

Resources & Credits:
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