Prior authorization 
goes digital

Corrected Feb. 2

Prior authorization creates a bottleneck. A physician prescribes a patient a medication, the patient goes to the pharmacy to pick it up, only to be denied. The pharmacist calls the physician's office, the physician's office calls the insurance plan, and the insurance plan faxes over a form for the physician to fill out and send back. Then, the patient can pick up the medication.

Prior authorization isn't just a time-suck—it's a patient-safety issue. Patients abandon more than a third of prescriptions that require prior authorization, according to prior authorization vendor CoverMyMeds. And according to an American Medical Association survey, 92% of responding physicians say that prior authorization harms clinical outcomes. The majority of respondents said they wait between one and five business days to get prior authorization decisions back from health plans.

As with most processes, digitization can speed things up. Now a slew of companies are working on the problem, offering electronic prior authorization in place of the old phone- and fax-heavy procedures.

While health plans have their own digital portals for prior authorization, these more comprehensive front-end, vendor-built solutions can be integrated into electronic health records—including those made by Epic and Cerner—so they're a part of, rather than a disruption to, existing workflows. They can also let a provider use the same interface for prior authorizations across health plans.

“Traditionally, the main problem with prior authorization is that it's not able to be identified until the patient has already arrived at the pharmacy,” said Luke Forster-Broten, manager for product innovation for Surescripts, which makes an electronic prior authorization tool that puts patient, prescriber and medication information in prior authorization forms so they can be automatically sent to payers and pharmacy benefit managers. The majority of the time, payers and PBMs send back approvals in less than a minute.

Electronic prior authorization also yields important data. That gives providers insight into abandonment rates and other metrics, said Scott Gaines, senior vice president and general manager of CoverMyMeds' provider solutions.

“From a PBM perspective, the value it's driving is measured best in the turnaround time of getting the decision out to the doctor,” said Dr. Lynne Nowak, chief physician experience officer for Express Scripts, a PBM that was recently acquired by insurer Cigna.

To make any of this possible, PBMs have to electronically code the answers to questions used to determine if a drug will be approved, Nowak said. For that work to be worthwhile, providers have to take advantage of it, so the company has been partnering with electronic prior authorization vendors to bring their tools to physicians. Now, a little over half of the prior authorizations Express Scripts receives are digital.

Automating prior authorization does have potential pitfalls. If an electronic prior authorization system is basing its decisions on outdated information or information that's not tailored to a specific patient, it might trigger a prior authorization when one isn't actually necessary.

“The only thing that providers like less than doing prior authorizations is doing ones they don't have to do,” Gaines said. “They'd rather wait for the pharmacy to tell them a prior authorization is definitely needed.”

That's why real-time benefit information at the point of care is so crucial. CoverMyMeds can offer such information so providers and patients can discuss lower-cost options.

Sometimes, providers might opt for a drug that doesn't require prior authorization. When one of those medications is available, providers switch to it about a third of the time, according to Express Scripts, which has partnered with Surescripts to put real-time prescription benefit information into the EHR workflow.

Express Scripts is also working on using the data it already has to help generate coverage decisions. “If we already know the patient's diagnosis and what other drugs they've taken, we shouldn't be asking the doctor to fill out our forms if we already have that data in our system or can extract it from the EHR,” Nowak said.

In the face of a more efficient process, payers, for one, may toughen their requirements to keep costs down, said David Schumacher, a partner with Hooper, Lundy and Bookman.

As of now, payers are more interested in boosting efficiency, which digitization can do, said Rich Birhanzel, Accenture's senior managing director of its payer practice.

“How the health plans react remains to be seen," he said. “There's a tension between the ease of the technology and the individualized consideration that payers want to see providers taking into account.”

A previous version of this article misattributed a quote to Birhanzel about pharmacies using authorization being used to boost revenue.