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True Cost of Prior Authorization Revealed

Fraser Cobbe

Orange County Medical Society

Seminole County Medical Society

A new study out this week from the American Medical Association (AMA) reveals how costly the failure of the Florida Legislature to act on Prior Authorization reform will be for Floridians. Prior Authorization reform has been a priority of organized medicine over recent years, yet the inability to pass legislation has enabled insurance carriers to expand utilization of these administrative processes. The data revealed by the AMA this week sheds light on the clinical and economic impact these processes are having on patient care.

From a clinical perspective, the survey of 1,000 practicing physicians revealed that 92% of physicians believe that Prior Authorization sometimes, often, or always delays access to necessary care. As far as the direct impact on patients, 78 percent of the physicians reported that prior authorization delays can lead to treatment abandonment and 92 percent of physicians indicated that it can have a negative impact on patient clinical outcomes.

What about cost and administrative burden?

The survey found that on average physicians seek 29.1 prior authorizations per week which results in 14.6 hours of physician and staff time. And 30% of physicians report having to wait at least three business days for a response from the insurance company. It is not a surprise to learn that 84% of physicians characterized the burden of Prior Authorization as high or extremely high.

Coming on the heels of the admission by Aetna's Medical Director that he never reviewed patient records when making coverage determinations, this AMA data illustrates the need for patients and lawmakers to demand accountability and transparency in these authorization processes. While insurers may argue these are necessary utilization controls, there is mounting evidence that these administrative processes are expensive and can negatively impact patient care and outcomes.

In addition to our advocacy efforts, the AMA and a coalition of 16 other organizations have released a set of 21 Prior Authorization and Utilization Management Reform Principles. These principles were developed by a broad cross section of the health care industry including physicians, hospitals, pharmacists and patients.

It is time for our elected officials to protect patients and hold insurance carriers accountable to prove that these administrative tasks have value and do not simply waste health care resources and threaten patient care.

Click Here for Additional Survey Results: https://www.ama-assn.org/sites/default/files/media-browser/public/arc/prior-auth-2017.pdf



 
 
 
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