Prior authorization: What is to be done?

If there’s one thing about health insurance that just about everyone can agree on, it is that prior authorization is hell. Corporate health insurers use prior authorization to delay and deny care inappropriately all the time. It’s a way for insurers to hold on to our money and maximize profits. So, what is to be done about prior authorization?

If you ask people on the political right, moderates, and even some on the left, they will say that we need prior authorization to protect people from harmful unneeded care and/or to rein in health care spending. But, insurers have been found, over and over again, to use prior authorization indiscriminately. When insurers use prior authorization to overrule treating physicians, preventing people from getting needed care, it saves the insurers tons of money.

People who support prior authorization do not tend to acknowledge that so long as insurers can use prior authorization as they will, in a proprietary fashion, people cannot compare health plans and make an informed choice. No one knows when and how an insurer will use prior authorization. That all said, there are ways to make prior authorization work.

The best way to make prior authorization work is to forbid insurers from making their own decisions about prior authorization. Instead, a group of independent specialists could come together and decide, based on credible evidence, which procedures warrant prior authorization. Their transparent findings could then be applied across the board to all insurers.

Establishing a centralized agency to make prior authorization decisions for all Medicare Advantage plans, much as Medicare Administrative Contractors process claims in Traditional Medicare, seems like an effective way to go. Not only would it help ensure consistency in the application of prior authorization across Medicare Advantage plans, relieve physicians of huge administrative burdens, and allow people to get needed health care more quickly, it would enable the collection of complete and accurate data to understand how prior authorization is working in a timely manner.

For now, to help ensure Medicare Advantage enrollees get the health care they need in a timely fashion, the Centers for Medicare and Medicaid Services should ban prior authorization. The evidence is overwhelming that prior authorization too often does tremendous harm to people who most need care, while helping the health insurers’ shareholders.

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