Pre-certification is a notification sent by a care provider to a health plan stating that a patient needs elective non-urgent services. In precertification, the carrier determines whether or not the member’s plan covers the requested procedure. This is in direct contrast to preauthorization which often requires a review of medical documentation to support the medical necessity of a doctor’s proposed plan of care or treatment.

Precertification is a request for coverage, whereas prior authorization is a utilization management review decision where an insurance carrier determines whether a doctor’s choice of care is the best decision cost-wise for the carrier, and best for the patient as well. Fundamentally different from preauthorization which often involves step therapy and medical review, pre-certification is a request to authorize a procedure that is in fact covered by the health plan but that requires prior permission.

But both can similarly lead to process delays that can disrupt patient care.

Delays That Negatively Affect Outcomes

There’s little question that prior authorization leads directly to physician dissatisfaction, but does it also affect patient care? The American Medical Association’s answer to that question is a resounding “yes.”

The 2017 AMA Physician Survey found that requiring preauthorization impacts patient care in three main ways.

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  1. Care delays. When asked how often the PA process delays access to necessary care, 15% of respondents said always, 39% said often, and 38% said sometimes. That’s a whopping 92% reporting of care delays due to preauthorization.
  2. Abandoned treatments. Asked how often issues related to the PA process lead to patients abandoning their recommended course of treatment, 2% said always, 19% said often, and 57% said sometimes. That’s 78% reporting that precertification can at least sometimes lead to treatment abandonment.
  3. Negative impact on clinical outcomes. Respondents were asked to rate their perception of the overall impact of the prior approval process on patient clinical outcomes. Sixty-one percent said there’s a significant negative impact and 31% said there’s a somewhat negative impact—that’s 92% reporting that requiring prior notification can have a negative impact on patient clinical outcomes.

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Pros and Cons of Precertification

 

Pros
It’s difficult to imagine that anyone would defend current pauthorization policies in the face of such strong evidence. Nonetheless, payers insist their processes are necessary for cost containment. Some argue that precertification requirements are helping stem the tide of opioid addiction.

Cons
Physicians strongly disagree. “Preauthorization is frequently characterized by insurance companies as an effort to deliver the best possible therapy to the patient and to avoid unnecessary care, but many physicians I’ve spoken with seem to think it is simply a tactic to make expensive care more onerous, driving down the costs to the insurance companies,” said Dr. Perry Wilson, an assistant professor of medicine at the Yale School of Medicine, in a blog post on MedPage Today.

The opaqueness of the precertification system is a large part of the problem. Physicians have little insight into why certain treatments and medications are approved or denied.

Some have questioned whether expensive drugs are simply denied across the board upon first request. Dr. Milton Packer wrote a blog post about a conversation he had with a retired physician who was working for an insurer in pre-authorization. Milton related that the physician not only spoke about denying expensive drugs the first time they’re requested, but also said he receives a bonus for not approving too many expensive drugs.

The post was highly controversial, and physicians and others with experience in treatment authorization for insurers stepped forward to say they had never heard of a health plan instituting such a bonus system.

Nevertheless, with prior approval requirements on the rise—51% of respondents to an AMA survey said the burden associated with obtaining authorizations has increased significantly over the past five years—it’s clear that more disclosure about coverage decisions and a streamlining of the preauthorization system would go a long way toward easing physician pain and improving patient outcomes by getting them the treatments and medications they need in a timely manner.

Policies around what triggers a PA requirement differ widely among insurers, leaving medical practices and other healthcare organizations scrambling to meet a dizzying and ever-changing number of standards. Delays in care can have catastrophic consequences for patients with time sensitive conditions, but the demand for prior approval continues to rise. Fortunately for healthcare providers, technology is emerging that can automate and speed up much of the PA process.

As Patient Care Suffers

The family of a 19-year-old woman who died of a seizure in 2009 has sued the pharmacy, the provider and a facility where the woman had been treated. The focus of the suit is the demand for PA on a medication the woman with epilepsy had been taking to control seizures. When she turned 19, the insurance company started requiring prior authorization. But according to the lawsuit, the woman tried to fill the prescription five times at the pharmacy and contacted the physician’s office seven times—all without success. After going without her prescribed medication for two months, she suffered a seizure that killed her.

Even in cases where approval finally comes through, a patient can be harmed by missing doses of required medication. In a guest column published last year, a woman describes the hurdles she went through to stay on a medication to control her Type II diabetes. She went without the medication that retails for more than $900 for two weeks after changing jobs and then for another two weeks a couple of months later because of what her insurer termed an “internal review policy”.

“Prior review puts some patients at risk that their treatment will be denied outright, even if the drug is listed on the insurance company’s formulary,” she writes.

And physician frustration runs high. One doctor explains that he and staff spend an inordinate amount of their time “fighting through the incredible sea of silly red tape necessary to get paid and to get our patients even basic care.” During the work week that prompted his column, the doctor mentions the authorization needed for a diabetes patient whose condition was well-managed, simply because the insurance company changed the preferred medication on its formulary. He also was informed that preauthorization was required for any patient over 65 who needed a muscle relaxer.

Speeding Up Authorizations

How Pre-Certification Differs from Preauthorization

Navigating the rock-strewn waters of prior authorization is difficult enough without the further obstacle of pre-certification. Some use the two terms interchangeably—further muddying the waters.

In fact, pre-certification is distinct from prior authorization, although the two stem from a single source: payers aiming to curb costs.

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Precertification verses Preauthorization

Preauthorization is a broad term referring to the process of determining the appropriateness and costliness of a referral visit, treatment, or medication. The process involves reviewing the patient’s medical history includes that particular medication, type of visit (e.g., the patient may have exceeded the number of physical therapy visits in a calendar year), or treatment (e.g., one that’s considered experimental or is reserved for those over a certain age).

In many cases, obtaining prior authorization requires the provider to submit documentation demonstrating why a particular drug or treatment was chosen. In most cases, when prior authorization is denied, the provider can submit a corrected claim, appeal via the website, appeal via a phone call, appeal via fax, or appeal via letter. Note that if a patient receives emergency care, there is usually a short window (often 24 hours) to apply for a retroactive granting of prior authorization.

Pre-certification is a more specific requirement from payers for obtaining permission to perform elective surgery, admit a patient to the hospital (under non-emergency circumstances), or perform one of the procedures listed by the payer as requiring pre-certification. It looks at whether or not a patient is eligible according to their contract with the insurer.

Although it’s possible to receive certification retroactively, the process is a lengthy one, involving significant resources. It often comprises an initial denial, followed by one or more appeals cycles requiring detailed documentation of why the procedure or admission was done without first obtaining pre-certification.

Note that in the case of elective surgery, the provider must show that the procedure is medically necessary in order to receive pre-certification. This usually involves a review of the physician’s order and the patient’s medical record by a healthcare profession to determine medical appropriateness.

Retroactive Certification
When precertification is denied retroactive certification is then required – where the doctor cites extenuating circumstances such as not sufficient time to obtain approval prior to treatment; or the reconsideration of a denial which was not denied for medical necessity.

Streamline pre-certification – 2 Easy Steps!

Although onerous, the first step to avoiding a claim denial from lack of pre-certification is to put someone in your practice in charge of tracking all such payer requirements. After gathering the information from each payer your practice engages with, he or she should plan to update the information on a periodic basis.

The second step is to enable electronic communication for pre-certification with as many payers as possible to speed up this process. Some payers require providers to use the provider website to apply for pre-certification; others offer the option of electronic data interchange (EDI) for this process. Some smaller payers may only offer pre-certification via a phone call or fax.

Providers who take the time to understand the subtle differences between prior authorization and pre-certification and take these steps to streamline the latter will find themselves in calmer waters when it comes to claims being approved upon submission.

A Sea of Paperwork

In a 2017 poll, 86% of physician practices indicated that requests for PA had increased from the previous year. That’s four percentage points higher than the same poll taken in 2016.

Findings from a 2017 American Medical Association survey show that 92% of care delays are over PA demands. The same percentage of physicians say it negatively impacts patient care. Nearly one-third of practices report waiting three or more business days for prior approval, often for a medication the patient is already on.

More than half physicians surveyed by the AMA said the burden of obtaining PA had significantly increased in the past five years, and 84% of practices described the PA burden as high or extremely high. Including prescriptions and medical services, practices report an average of 29 authorizations per physician per week amounting to 16 hours of telephone time and paperwork interacting with insurance companies.

Given the sheer volume of precertification requests, the time to complete each one, and still more time spent discussing cases directly with insurers, physician practices are grasping for ways to deal with the onslaught of requests. Fortunately, this is a case where technology can help.

Can Technology Speed Up Prior Authorization And Lessen Patient Impact?

Easing the pain of precertification with software

Physician practices that are considering automation software should understand that it needs to be integrated with the electronic health record and billing software to bring efficiencies to the process.

In addition to three must-haves for any software system, practice managers should closely consider their own processes around PA in relation to what a vendor offers. Any software system should:

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  • Automatically determine whether PA is required, based on the patient’s insurance. If so, the system should be able to initiate the process.
  • Help staff easily create a successful submission by auto-filling patient/physician information, prompting the clinician to provide additional information.
  • Track all pending authorizations, and flagging delayed requests that require additional input.

Software that provides a dashboard on the status of current PA requests will help practices gain insight into what’s often a chaotic process. Moreover, the software’s payer rules engine should be updated with regularity and be customizable to account for local rules. Finally, the software itself should also conform to a practice’s workflow, although practice managers should realize that adaptations will likely be a give and take and need to go both ways.

Precertifications are shown to delay patient care and unduly increase the workloads of physicians and their medical staff while robbing precious time away from patient care. Even in the midst of lobbying by the AMA and other health organizations, along with state efforts to pass legislation curbing the demand placed by insurances, the trend shows no signs of slowing down. This means that practices need to proactively leverage appropriate technology to speed up and manage the approval process in order to better focus on patient care.

The Coalition for Affordable Quality Healthcare (CAQH) that monitors electronic adoption of technology within the healthcare industry reports that adoption of electronic prior authorization (ePA) declined in 2016 from 18% to 8% in 2017. And it reports that demand for prior notification rose 38% during this same period. Although the number of software companies that offer applications to manage prior approval are still few, the list is growing and physicians could do well to seek them out.

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Sources:

  1. Pre-Certification 101, Nahama Jain, Eligible.com, April 8, 2016, //eligible.com/community/pre-certification-101/
  2. Aetna.com, //www.aetna.com/health-care-professionals/precertification.html
  3. “What Is the Difference Between Preauthorization & Pre Certification Insurance, Jason Gillikin, October 25, 2017, Pocket Sense, //pocketsense.com/what-is-the-difference-between-preauthorization-pre-certification-insurance-12314906.html
  4. Policies, Aetna.com, //myplanportal.com/healthcare-professionals/policies-guidelines/precertification.html