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There is an article on Linked written by Beth Kutscher, Editor at Large at LinkedIn News that we’d like to review. Kutscher also has a group called Path to Recovery. Our COO Denise Corbisiero read the article “Doctors hate prior authorization. Some payers may be starting to soften.”  Below is a summary/response of the article regarding authorizations for healthcare in general. Denise’s response is directed towards Substance Use Disorder (SUD) and Mental Health (MH). Although MH Parity is law, it seldom crosses the bridge from medical to SUD and MH with the best interest of the patient in mind.

Integrity Billing handles authorizations for individuals seeking treatment for substance use disorder and mental health care.

Insurance companies often challenge the coverage of certain drugs or procedures, leading to delays and deaths due to the process of prior authorization.  In Substance Use Disorder treatment, there is rarely a “prior authorization” process in place. The authorization can only be obtained once the patient is admitted.  Is it the same in other medical specialties? According to the article, this has become a significant concern for the American Medical Association (AMA). However, recent developments suggest change is on the horizon.

Shift in Policy 

UnitedHealthcare, the U.S.’s largest health insurer, declared they would discard prior authorization for nearly 20% of its procedure codes. They also introduced plans for a “gold card” program to simplify approvals for specific healthcare providers. In addition, Cigna Healthcare abolished prior authorizations for about 25% of its medical services, but not for mental health services or substance use disorder services.

State Initiatives

In Michigan, one of over 30 states mulling legislation to alter prior authorization, the dominant insurer, Blue Cross Blue Shield, announced a reduction of 20% in prior authorizations and a broader “gold card” initiative. Jennifer Rohs of Henry Ford Health in Detroit perceives a genuine intent from insurance payers and the federal government to address the issue, although it’s still in its early stages. Please note, Michigan doesn’t even allow their patients to leave the state for care. Even with a PPO, they will not permit the member to choose a physician in the network outside of the state.

Financial Implications

The prior authorization process is costly. For instance, Henry Ford Health, whose prior authorizations surged by 30% since 2019, spends about $8 million annually on related labor costs. This is in spite of a 95% approval rate for initial submissions. The figure doesn’t even consider the time physicians spend or the stress they endure. So, since Henry Ford is calling the shots in Michigan, and it is costing them money, they will make provisions for Michigan medical care – just don’t leave Michigan.

Collaborative Approach

A shift is noticeable in how health systems like Henry Ford liaise with insurance providers, especially prominent ones. The dialogues are evolving as insurance companies are keen to streamline the process, benefiting both patients and their bottom line. In fact, 86% of doctors report patients experiencing setbacks like ineffective treatments and hospitalizations due to prior authorization delays. They do not mention that the delays can at times be longer than fourteen business days. No wonder.

Technological Solutions

Tech firms are entering the fray to automate prior authorizations. Companies like Rhyme offer software to help health providers manage pre-approvals. While healthcare providers find it beneficial, its growth largely comes from the insurance side. The main focus now is on creating a network bridging insurance providers and healthcare providers. 

Industry Trends

A whopping 92% of insurance plans aim to optimize the prior authorization process for medical services, while 96% intend to for prescriptions. The primary shift is from manual to electronic preapprovals. So, they are saying they will change the technology, making it a faster process. However, that says nothing about the amount of denials that are received. Are they going to make it faster and provide less denials?

Adverse Effects

Sadly, prior authorizations can have dire consequences. Over one-third of doctors claimed a patient had faced adverse outcomes because of it. There were 9% noting serious repercussions like permanent disabilities or death. If it’s 9% on the medical side, I would dare say it’s at a minimum double that for substance use disorder and mental health.

In discussions with insurers, health systems like Henry Ford are highlighting the negative effects of prior authorizations, emphasizing both statistics and patient experiences. The aim is to humanize the issue, making insurance representatives more receptive to change.

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Integrity Billing handles authorizations for individuals seeking treatment for substance use disorder and mental health care. Reach out to our team today.

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