You may need approval from your insurance company for some treatments, medications, and medical tests before you can get them. Here's why.

Let's say your doctor prescribes you a certain medication or recommends a certain treatment. Sometimes, you have to get what is known as prior authorization first. You might be wondering why. After all, if your doctor thought it was a good idea, isn't that enough?

In some cases, that may not be the case. The health care system is a bit more complicated than that. Getting the care you need, while keeping healthcare costs down, requires some checks and balances between your doctor and your insurance company. Prior authorization is one of those checks.

So what is prior authorization, and how can it affect your coverage? Here's what you need to know.

Get access to the care you need with the right health insurance plan. Call a licensed insurance agent at 1-800-827-9990, or compare plans online today.

What is prior authorization, and why does it exist?

Your insurance plan has certain guidelines about which prescription drugs, treatments, and services it will cover and help pay for. But sometimes your doctor or another healthcare provider may recommend or prescribe a drug or treatment that isn't covered by your health plan.

In those cases, your doctor will need to get approval from your insurance company before providing the treatment. That's prior authorization in a nutshell (you may also see it referred to as "preauthorization' or "precertification"). It's a way for your insurance company to make sure that the drug or treatment they recommended for you is:

• Medically necessary. That means you truly need this service to treat or manage a health condition and that the treatment plan your doctor recommends is supported by established treatment guidelines.
• Not being duplicated. If you see many different providers, there's a chance that one of them could order a test or treatment that's already been done by another provider. Prior authorization can act as a way for your insurance company to help coordinate your care among multiple providers and make sure that the services aren't being duplicated.
• The most economical option. Your insurance company may require prior authorization for a high-cost treatment or drug if lower cost options are available that haven't been tried yet.

The main goal of prior authorization is to keep health care costs down. "Reducing costs is reasonable if the intent is to pass the savings on to patients and not shareholders,' notes Cecil Bennett, M.D., a family physician at Newnan Family Medicine in Newnan, Georgia.

In other words, prior authorization is not meant to increase insurance companies' profits — it's meant to keep costs down for patients like you. It also helps ensure that the right people get the right care at the right time. When used appropriately, it should improve patient safety and health outcomes while lowering costs.

But many medical professionals argue that it can be a roadblock to getting their patients the care they need. For example, it can delay the start of your treatment, and sometimes legitimate requests can be wrongly denied. In fact, a recent study found that 13% of prior authorization requests that were denied by Medicare Advantage plans should not have been.

Which health care services require prior authorization?

It depends on your health insurance plan. Each plan will likely have certain tests, treatments, and drugs that require prior authorization, but it varies. In general, services and treatment that are very expensive are more likely to require prior authorization.

Some services that may require prior authorization include:

• Advanced imaging tests like magnetic resonance imaging and computerized tomography scans
• Home health services or being admitted to a skilled nursing facility
• Nonemergency hospital stays
• Rehabilitation services like physical therapy
• Some medical equipment (like wheelchairs), orthotics (for foot problems) or prosthetics
• Some surgeries, like bariatric surgery (weight-loss surgery) or organ transplants

Also, health plans have a specific list of drugs that they cover, which is called a formulary. "If a provider orders a drug that is not on the formulary, the insurance company will ask the provider to complete a prior authorization form justifying why they would like to prescribe the drug in question instead of alternatives on the formulary,' explains Dr. Bennett.

However, if your plan covers emergency care, it cannot require prior authorization for emergency medical care, even if the hospital or provider is out of network.

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How do I get prior authorization?

If you need prior authorization for a treatment or service, your provider will need to submit a prior authorization form to your insurance company. You may need to help them by filling out some paperwork or providing documentation.

When it comes to medications, you may not know that you need prior authorization until you go to fill your prescription at the pharmacy. Your insurance company will notify the pharmacist if a prescription requires prior authorization. Then, the doctor that wrote the prescription will need to fill out a prior authorization form.

The prior authorization request is then reviewed by clinicians at your insurance company. How long the review takes varies. It can take as little as a few days or as long as a month. If your request is urgent, it can be rushed so that a decision is made within 24 hours. Your provider's office may be able to give you an idea of how long the request might take.

What happens if my treatment isn't approved?

If your request for prior authorization is denied, you can file an appeal. Talk with your doctor about what the next steps might look like. They may have to speak to the clinicians at your insurance company to make their case for the treatment plan, says Dr. Bennett.

If the request for prior authorization is still denied after your appeal, your doctor may need to come up with an alternative treatment plan. In some cases, they may need to try a lower-cost treatment plan first. If you try that treatment and it doesn't work for you, your doctor may then be able to prescribe the original plan again and get it approved.

Of course, you can opt to pay for the medication, treatment, or test out of pocket, but that option is often too expensive for people to afford.

While the prior authorization process is not perfect, remember that the intention is to make healthcare safer and more cost-effective. It can help you avoid getting unnecessary or redundant treatments, which could save you time and money.

Another way to save money on healthcare is to shop around for a health plan. Call a licensed insurance agent at 1-800-827-9990, or compare plans online.

Sources

Journal of the American Medical Association. "Improving prior authorization in Medicare Advantage.' October 18, 2022. Retrieved from https://pubmed.ncbi.nlm.nih.gov/36190725/

UnitedHealthcare. "Prior Authorization Requirements for UnitedHealthcare: Effective December 1, 2022.' Retrieved from https://www.uhcprovider.com/content/dam/provider/docs/public/prior-auth/pa-requirements/commercial/Commercial-Advance-Notification-Prior-Auth-Requirements-12-1-2022.pdf Accessed December 20, 2022

U.S. Department of Health and Human Services Office of the Inspector General. "Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care.' April 27, 2022. Retrieved from https://oig.hhs.gov/oei/reports/OEI-09-18-00260.asp?hero=mao-report-04-28-2022

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