MGMA Article: Transforming Prior Authorization
June 10, 2020
YiDing Yu, MD, Chief Medical Officer
Giving patients the right care at the right time has become increasingly challenging, and the friction between cost-conscious insurance companies and patients and their providers will not change anytime soon. As the healthcare landscape continues to become more complex and providers look for new ways to enhance care while managing the bottom line, finding new ways to improve delivery of care has become a priority for many healthcare executives.
One of the biggest challenges in providing timely care to patients is prior authorizations. An American Medical Association (AMA) survey of 1,000 practicing physicians found that 86% described the administrative burden associated with prior authorization as “high or extremely high” and 88% said the burden has gone up in the last five years.1 Estimates have prior authorizations increasing 14% year-over-year and up 27% from the index in 2016.2 As the burden of prior authorizations continues to increase, so does the need to manage the increasing challenges in delivering care.
Orthopedic surgery: A case study
Specialties with a high volume of non-urgent procedures, imaging and specialty drugs often face the highest burden of prior authorizations. Orthopedic surgery is prime among them.
Due to the elective nature of orthopedic surgeries and imaging for chronic conditions such as osteoarthritis, patients seeking treatment must meet strict medical necessity criteria. Most payers require documented imaging of joint destruction, significant impact on life, and demonstrated failure of conservative medications, physical therapy and injections. Simply submitting a prior authorization to a payer can require 30 to 60 minutes, and decisions may take up to two weeks to return. Denials would then require appeals, which may require a peer-to-peer evaluation and weeks of rework.
The prior authorization burden was felt acutely by the patients, surgeons and staff at New England Baptist Hospital (NEBH), an orthopedic specialty hospital with more than 90 affiliated surgeons in solo or group private practice. Ranked as one of the top hospitals for orthopedics by U.S. News & World Report, NEBH partnered with its affiliated providers to address the prior authorization challenge. Among its collaborators was Boston Sports & Shoulder Center (BSSC), an award-winning 14-surgeon private practice with five locations in the greater Boston area.
A growing challenge
With more than 200 daily incoming fax orders, NEBH faced a growing backlog of prior authorizations that hampered patient access and depressed throughput. The average turnaround time from when the order was received to scheduling the patient was nearly 11 days, resulting in repeated phone calls from frustrated patients. Telephone abandonment rates reached nearly 16%, and managers struggled to hire and train additional staff to meet the demand. Management had no visibility into productivity, time to completion or location of bottlenecks in the process. In addition, a process held together by overburdened staff meant that there were unintentional mistakes, resulting in downstream write-offs that affected both provider and facility fees.
The burden of prior authorizations was also felt acutely at BSSC, a tech-savvy modern orthopedic practice with a growing patient base and an expanding roster of surgeons. Surgical coordinators worked with each surgeon and were focused on patient care and clinical support yet were also responsible for prior authorizations. They had little administrative time to complete prior authorizations and struggled to keep up with the volume.
Leveraging artificial intelligence (A.I.)
To address the unsustainable challenges of prior authorizations, NEBH and its affiliate orthopedic practices, including BSSC, chose to implement technology that leverages A.I. to automate and standardize the prior authorization process, making it more reliable and scalable across their various locations. A.I. — unlike robotic processing automation, which uses bots to handle repetitive tasks and are limited to only a few prior authorization tasks, such as portal checks — helps augment human staff for complex tasks. A.I. platforms can retrieve relevant clinical documentation directly from the EHR, grade clinical documents against payer medical necessity rules, and prepare an authorization submission and track the authorization to approval.
Eliminating manual processes transformed NEBH operations in just a few months. Freed from payer calls, staff were able to focus on patient care. Telephone abandonment rates dropped from 15.6% to 2.9% within two months and have remained below 3% since implementation. Turnaround times from order placed to prior authorization approval now average 2.5 days, a dramatic reduction from its 11-day average previously. Appointments are scheduled faster, and patients, physicians and staff are happier.
By streamlining the prior authorization process, NEBH has strengthened its financial position as well. In a year-over-year comparison, write-offs were reduced by 30% and staff costs dropped 25% through increased productivity. Moving to an automated platform delivered a four-fold ROI to NEBH in just the first year. “We needed a dependable authorization process, and our experience has been very positive. We’ve reduced write-offs by 30%, cut turnaround times by 78%, while improving staff productivity by nearly 25%. This is one of the best decisions we’ve ever made,” said Tom Gheringhelli, chief financial officer, NEBH.
Because NEBH made the decision to improve its prior authorization process and look for an A.I. solution to solve its challenges, its affiliate orthopedic groups also benefited.
After implementing the new prior authorization process with A.I. technology, BSSC surgical coordinators saw a substantial reduction of prior authorization burden. In a survey of surgical coordinators, 100% of respondents “strongly agreed” that the new process saved them time. With A.I.-augmented prior authorizations, fewer prior authorizations saw denials that required peer-to-peer reviews — 75% of respondents reporting fewer peer-to-peer reviews, which relieved valuable surgeon time.
Most important, patients benefited, too. All surgical coordinator respondents reported that turnaround times of prior authorizations were faster, giving patients better access to care and much-needed peace of mind.
“Since implementing Verata, we’ve been able to scale our practice,” said Fran Helms, business manager, BSSC. “Surgical coordinators are spending less time on prior authorizations and more time on supporting providers in delivering superior care to our patients.”
Despite a growing volume of prior authorizations required by payers, NEBH and its affiliated orthopedic practices such as BSSC have bucked the trend: Fewer staff are burdened by prior authorization work, and they spend less time on them. With strong patient satisfaction, streamlined prior authorizations, and faster scheduling, NEBH and BSSC have recaptured lost revenue and improved their financial bottom line.
Beyond point solutions, A.I.’s ability to assist with complex tasks, such as reviewing clinical documentation and grading medical necessity criteria, reduce the burden that falls on providers and their staff. Practice leaders frustrated by their own prior authorization challenges should explore A.I. and automation solutions as potentially valuable tools in their quest to deliver better, faster patient care.
- Robeznieks A. “1 in 4 doctors say prior authorization has led to a serious adverse event.” American Medical Association. Available from: bit.ly/37IVuxv.
- 2018 CAQH Index. “A Report of Healthcare Industry Adoption of Electronic Business Transactions and Cost Savings.” Catalyst Newsletter. Available from: bit.ly/2RF4aPO.