Preauthorization: Importance & Process

Receiving permission from the payer before providing treatment to the patients is known as Preauthorization. It works as a confirmation for the provider that the procedure is covered by insurance and the practice will be reimbursed for the treatment.

In this blog, we will learn about the need of pre-authorization in medical billing.

The Need for Pre-authorization in Medical Billing

Pre-authorization is important for revenue management as it provides surety of payment to the providers for the treatments rendered. If an insurer does not authorize specific treatment, item, or service, the procedure can not be executed.

The objective of pre-authorization is to reduce duplicating services that cost much to the payers. An unapproved authorization interrupts the patient treatment due to procedures that are not sanctioned, incomplete patient information or any documentation error.

The Process of Pre-authorization

When a patient goes to a hospital, their medical insurance is checked, and all the benefits are validated. If any information is missing from the patient, they are notified immediately and are informed about their out-of-pocket costs.

If any information is changed, the data is then revised and updated. The insurance company then checks the patient’s schedule and approaches the payer’s back-end team to receive the pre-authorization code.

The codes are then sent to the doctor’s office which ensures that the patient receives the treatment that is covered by insurance.

While checking for eligibility, a practice must keep these things in mind:

• Contact the insurance company and share all the clinical documentation to get initial authorization.
• After that the providers must complete the initial start of care document and care plan paperwork.
• The provider must maintain a strict follow-up timeline and schedule events to track the progress.
• Integrate the practice of listing the progress of all reauthorizations on a weekly basis, regardless of their state i.e. open, pending or rejected.
• These reporting practices help you gain oversight and will give you input about how you can simplify the pre-authorization function.

Benefits of Pre-authorization

• Minimizes rejections and boosts collections
• Reduces Write-offs
• Helps patient understand their financial responsibility
• Supports Healthcare Practitioners
• Provides accountable and cost-effective solutions

How to Guarantee Smooth Preauthorization?

Healthcare providers come across various issues continuously when dealing with the pre-authorization process. Hereunder are some effective practices to minimize significant interruptions in the pre-authorization process.

Follow these steps for a seamless pre-authorization process:

• Acquire pre-authorization, provide accurate documentation and follow-up on a regular basis. 
• Notify insurance providers about any emergency patient admissions.
• Communication between the payer and the provider is a must for effortless pre-authorization. 
• Synchronize pre-registration data with the pre-authorization technique. 
• It is important to use CPT codes accurately.

What Happens If Pre-Authorization Is Not Acquired?

The payer policies govern who will be responsible for payments. In some cases, some health plans hold the insurer responsible while in other cases the patients are held responsible.

If a treatment is provided without preauthorization, some patients refuse to pay.

Insurance companies use an exclusion list to determine which drugs are covered by the plan or not. A major part of the population feels that their recommended medication or therapy will be compensated if they have insurance. Well, that is not the case.

They are unaware of the exclusion list entries until the payer informs them about it. Always keep in mind that every payer has their own set of exclusions and inclusions. Some payers include operations such as selective/ emergent/ urgent medical treatments, skilled nursing facilities, surgical inpatient stays, inpatient rehabilitation treatments, subacute admission processes or transplants as inclusions. As a result, they require preauthorization.

Pre-authorization is also required for expensive radiological procedures such as ultrasounds, CAT scans, and MRIs.

Final Statement 

Managing pre-authorization along with taking care of patients is a hectic task. This has left healthcare practices perplexed across the globe. This is where medical billing professionals such as Unify Healthcare Services can help you secure accurate reimbursement.  

Unify Healthcare Services is a well-established  RCM services company that manages medical billing for various healthcare organizations and private practices. They have a dedicated and qualified team of medical billers and coders who are well versed with all the elements of medical billing including Pre-Authorization. They have the expertise to manage all your pre-authorization requirements.  

Once you partner with them, they will communicate with the insurance company to check for pre-authorization on patients. They will handle all the documentation and inform you if the patient is not eligible for the treatment required instantly.  

Partnering with professionals like this makes your billing process easy and hassle-free so you can focus solely on patient care.