2017 State Legislative Conference

State Actions Could Solve Prior Authorization Dilemma

November 07, 2017 02:34 pm Michael Laff Dallas –

Physicians know that time spent justifying a course of treatment to an insurer means less time with the patient, and any step to reduce that burden improves care.  

Emily Carroll, J.D., an AMA legislative attorney, tells family physicians at the 2017 AAFP State Legislative Conference in Dallas how a coalition that includes the AAFP is tackling administrative burden.

Amid growing awareness of the need to cut this sort of administrative burden, Emily Carroll, J.D., a legislative attorney with the AMA, told family physicians about initiatives aimed at easing prior authorization hassles in a presentation during the AAFP State Legislative Conference held here Nov. 2-4.

Such relief is urgently needed. According to a 2016 survey(www.ama-assn.org) that asked 1,000 physicians about prior authorization, nearly 60 percent of respondents said that, on average, they wait at least one business day for a decision on prior authorizations; 26 percent said the wait was three days or longer.

A typical physician practice handles about 37 prior authorizations in a single week -- administrative work that requires, on average, two business days of physician and staff time to process, according to the survey. One-third of respondents said they have staff who work exclusively on prior authorizations. Seventy-five percent of respondents said the burden of handling prior authorizations is high or extremely high.

Compounding the problem, physicians might not even know that a patient's plan requires prior authorization until, for example, the patient arrives at the pharmacy to fill a prescription.

Some states are addressing the problem by requiring insurers and vendors to utilize electronic prior authorizations (ePAs) in electronic health records. With ePAs, a flag pops up on the screen when a physician orders a particular treatment that requires approval from the insurer.

"This could change the way we do prior authorizations," Carroll said. "It is really a game-changer."

She discussed laws dealing with prior authorization that have passed in states such as Delaware, Arkansas, Washington, Virginia and Ohio. In Ohio, for instance, insurers must respond within 48 hours to prior authorization requests regarding urgent care, and within 10 days for those concerning nonurgent care.

The AMA has drafted model legislation(www.ama-assn.org) for states that goes further in emphasizing transparency and quick response. It calls for insurers to respond to prior authorization requests within one business day for urgent care and two business days for nonurgent care. It also requires insurers to notify practices at least 60 days before any change to prior authorization policies takes effect.

Recognizing that insurers are likely to continue the practice of utilization management, the AAFP, AMA and 15 other organizations this year issued a set of 21 principles(www.ama-assn.org) that emphasize the need for clinical validity, continuity of care, transparency, timeliness and exemptions in prior authorization policies. Carroll urged practices to help communicate these principles to local insurers and pharmacy benefit managers.

And she noted that one of the changes called for in the principles is the use of standardized ePAs.

"We would love to see similarities across insurance plans on clinical criteria," Carroll said.

Carroll said the AMA plans to release a study next year on how time devoted to prior authorizations affects patient care.

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