May - June 2018 - Volume 23, ISSUE 3

Prior Authorization Headache: Prognosis and Treatment

Prior authorization is a challenge that needs to be addressed through a multifaceted approach—including research, advocacy, and education—to reduce burdens on physicians and patients.

Contributed by the American Medical Association (AMA)

Prior authorization is a health plan cost-control process requiring providers to obtain approval before performing a service to qualify for payment. Health insurers frequently require prior authorization for pharmaceuticals, durable medical equipment, and medical services. Prior authorization requirements and protocols differ greatly between insurers and specific plans, and providers must often wade through voluminous payer bulletins to learn of program changes. The inefficiency and lack of transparency associated with prior authorization cost physician practices time and money. The lengthy process may also have negative consequences for clinical outcomes, as recommended treatment may be delayed or even abandoned when patients face the obstacles created by these cumbersome programs.

Due to its widespread usage and the significant administrative and clinical concerns it can present, the AMA believes that prior authorization is a challenge that needs to be addressed through a multifaceted approach—including research, advocacy, and education—to reduce burdens on physicians and patients.

Prior Authorization Survey?
In order to quantify prior authorization’s effect on physicians, the AMA and a market research partner fielded a web-based survey (tinyurl.com/y8mgqehg) of 1,000 practicing physicians who routinely complete prior authorizations in their practice. Responses from the December 2017 survey show the significant burdens that prior authorizations place on patients and physicians. Specifically, 92 percent of physicians report that prior authorization at least sometimes delays patient care, with 54 percent reporting that such delays occur often or always. Additionally, 78 percent of physicians report that prior authorization can result in treatment abandonment, such as a patient failing to fill a prescription after it has been delayed due to prior authorization hurdles. In addition to patient impact, 84 percent of surveyed physicians report that the administrative burden of prior authorization is high or extremely high, and 86 percent of physicians report that the problem has gotten worse over the past five years.

Consensus Statement
In order to address the negative impact of prior authorization, the AMA convened a workgroup of state and specialty medical societies, national provider associations, and patient representatives to create a set of best practices related to prior authorization and other utilization management requirements. The workgroup identified the most common provider and patient concerns and developed a set of 21 Prior Authorization and Utilization Management Reform Principles (tinyurl.com/yataeyqt), which were released in January 2016. The widespread outreach and advocacy campaign that followed the release of the principles triggered conversations with the health insurance industry about reducing prior authorization burdens.

These discussions led the AMA, American Hospital Association (AHA), America’s Health Insurance Plans (AHIP), American Pharmacists Association (APhA), Blue Cross Blue Shield Association (BCBSA), and Medical Group Management Association (MGMA) to develop the Consensus Statement on Improving the Prior Authorization Process (tinyurl.com/y94h7o9h). Designed to establish common ground between providers and payers, the consensus statement seeks to improve the prior authorization process and promote quality patient care by encouraging selective application of prior authorization; promoting reviews and volume adjustments of requirements; pushing for increased transparency and communication between plans, physicians, and patients; protecting continuity of patient care; and encouraging automation to reduce administrative concerns.

Electronic Prior Authorization (ePA) for Prescription Drugs
As suggested by the consensus statement, process automation is one aspect of prior authorization ripe for reform. This is particularly true for prescription medications, as prior authorization restrictions for drugs are often not readily apparent to the physician at the time of prescribing. Instead, prior authorization requirements are frequently not discovered until the patient arrives at the pharmacy and learns that the prescription cannot be immediately filled. The pharmacist alerts the physician, who in turn must seek authorization from the health plan. Not only is this scenario inefficient and time-consuming for physicians and practice staff, but it can cause patient care delays and even medication nonadherence.

To reduce some of the hassles associated with prior authorization for prescription drugs, physicians can implement ePA in their practice. ePA integrates utilization management requirements into physicians’ electronic health records and electronic prescribing workflow. The ePA process facilitates a prospective process and ensures that drugs are properly authorized prior to prescriptions being sent to the pharmacy. In order to help physicians understand and implement ePA, the AMA created a three-part educational video series (tinyurl.com/ya54x5e). The videos detail the burdens associated with prior authorizations, explain how and why a physician should implement ePA, and provide an overview of the AMA’s broader advocacy efforts on this issue.

To access these resources and additional information on the AMA’s work to improve the prior authorization process, visit www.ama-assn.org/prior-auth.