Expert Q&A: Boosting Efficiency to Revolutionize Prior Authorizations

Prior authorizations are one of the costliest and labor-intensive workflows in healthcare. A large part of the problem is the manual nature in which prior authorizations are still handled and the lack of standardization throughout the process. The complexity of prior authorization requirements and varying guidelines among different payers further exacerbates the problem, requiring healthcare providers to navigate a maze of differing criteria, documentation requirements, and approval processes. This often leads to delays and denials, negatively impacting patient access to timely and appropriate treatment.

Throughout Availity’s extensive work with payers and providers, we’ve seen firsthand how the manual nature of prior authorization processes ultimately creates unnecessary waste in the healthcare system. We sat down with Availity expert Krisi Hutson, senior director of product development, to gain insight into the complexities surrounding prior authorizations and the potential for transformative solutions in streamlining this burdensome system.

Why is the prior authorization process so resource-intensive?

There are a few reasons for this. First, while a HIPAA-mandated ANSI transaction (ASC X12N 278) has been in place for quite some time, it has yet to be widely adopted. As with other administrative transactions, there is also no strong enforcement or penalties for not following the mandate to force payers or providers to use electronic means.

Additionally, there hasn’t been a clear, automated way to process prior authorizations, which means that they require a lot of manual effort to complete. This is because prior authorizations are not solely an administrative or clinical transaction. On the one hand, tactical, objective data points can be handled in an administrative transaction, such as who the patient is, what procedure is being requested, and where it will be done. On the other hand, there are subjective, non-normalized pieces of clinical information that fall to the medical policy and the holistic care of the patient that helps to influence whether authorization is required and, if needed, whether it is approved. All of this makes prior authorizations a much more involved and complex process than other purely administrative transactions.

Why do prior authorizations create a significant administrative burden?

Prior authorizations bring significant waste to both the payer and the provider market. One of the primary challenges is the lack of widely adopted industry standards for when authorizations are required.

Requirements for authorization can vary at the plan or even sub-plan level. For example, a payer will request authorization for an MRI or a CT scan. However, one particular employer group within that plan may require employees to get a chest CT scan every five years due to their working environment and, in that specific case, they don’t need an authorization even though they’re part of that same plan. These “carve-outs” can be very specific, and the medical policy can be adapted down to the plan level due to the clinical aspects of care, cost containment, and the management of a population’s health.

Because of that disparity in policy and process, there hasn’t been a clear, automated way to process prior authorizations adopted across the industry to normalize requirements and data. Additionally, this variation often creates the use of non-digital channels such as phone, fax, or mail to determine information, both on the payer and the provider side. These factors combined make prior authorizations a challenging and time-consuming process, requiring a lot of manual effort to complete and creating significant administrative burdens.

Payers and providers are impacted in different ways by authorizations. Can you discuss the issues they share, as well as issues that are unique to them?

The lack of standardization in policies and data consumption is a common problem for payers and providers. They don’t have a clearly defined set of data to look at. There is not a single system where they’re going in and providing a few pieces of information to automatically be informed if a patient requires authorization and if it is approved. Multiple systems are impacted by legacy information and are still managed outside the adjudication system.

Additionally, payers often outsource medical policy decision-making to third-party groups to determine if authorization is required and issue approval or denial decisions. This creates further complexity for providers, who must navigate the different divisions of the payer or third-party subsidiaries to manage their relationships effectively. Outsourcing also limits the payer’s visibility and downstream use of patient data to drive further efficiencies.

Why can’t payers and providers just automate the process like other transactions?

I believe that the “just do it” philosophy is partly to blame for the lack of centralized goals among payers. That is one area where Availity has a crucial role to play in bringing stakeholders together with our multi-payer approach to establish standardized protocols, even in the absence of a mandate. This will help make it easier for providers to integrate and automate their prior authorization workflows.

However, the aforementioned complexity of the administrative and clinical transactions involved and the fact that there are no clear frameworks that tie those pieces of data together today means that we need to work with vendors from both the payer and provider sides to help marry workflows that have existed for the exchange of clinical data as well as administrative data into a more seamless process.

What do you see as the big prior authorization issues facing clients? What are the bottlenecks that are happening?

I’ve found that many people still heavily rely on non-digital channels. The problem is that the lack of standardization and centralized data collection makes it hard for people to make the switch to digital channels, such as using online portals or fully integrated systems that talk to each other without human intervention.

One solution to this is to partner with organizations like Availity, which specialize in multi-payer approaches and building digital data exchange networks. Our goal is to move as many transactions as possible from manual to blended authorizations, and ultimately to fully electronic, which can save a significant amount of money. In fact, according to the 2022 CAQH Index, electronic prior authorizations represent a $449 million cost savings opportunity annually for the medical industry.

Can we expect any rules or regulations from HHS or CMS regarding streamlining prior authorization rules in the future?

I think it will come eventually as we start to see more focus at the state level. Many states are already beginning to implement their own regulations related to authorizations, which may prompt HHS to step in as well. Medicare, which has never required authorizations before, is also introducing new requirements around advanced imaging and other protocols, and there may be potential requirements on managed health segments as well, prompting further involvement from CMS.

Can you explain what Availity means by end-to-end authorizations and what the infrastructure looks like to support this capability?

Availity has a multi-tiered approach to end-to-end authorizations. The first tier is the authorization foundations solution, which encompasses the Availity Essentials portal and Intelligent Gateway offerings. This provides a multi-payer experience—so even if there are disparate actions taking place for authorization requirements or different data repositories for medical policies, the interaction for the provider is as streamlined and efficient as possible.

The second tier is enriched services, which includes appeals, correspondence, and attachments. There are requirements in every payer contract that the final resolution of the authorization is delivered in a written format. Right now, a tremendous amount of that happens via traditional mail. Availity has opened a digital channel where that information can be shared through the portal. It also allows for the addition of clinical data.

Availity also uses API protocols to integrate with providers’ EHRs and payers’ host systems. We extract the data necessary for the administrative portion of the transaction and prompt the user for any additional clinical information or context that needs to be added to the case to administer it. Users are presented with the tasks in their native workflow to reduce context switching or multiple systems.

Finally, Availity is exploring true B2B interactivity and interoperability, including using AI to interpret clinical data and recommend appropriate actions. For example, if the data provided only meets three of the four requirements for a surgery request, the system will prompt the end-user to add missing information. On the other hand, if a nurse working in utilization review needs to verify specific information, the system will pull that information out and highlight the relevant contents, saving time and reducing waste.

Which parts of the authorization process have the most potential for becoming touchless?

The first step in the process is determining if an authorization is required. In that transaction, there are essentially three pieces of information that a provider gives to a payer, e.g., I have this patient, they have this complaint, and they need this test/surgery/medication. The payer then cross-references that data with information such as what plan the member is on and what medical policy they need to abide by. Availity has the potential to remove the most waste here. By coming to a centralized model for sharing the request and response, we can fully automate this process.

Additionally, standardizing the authorization requirements for diagnostic procedures such as advanced imaging, cardiac testing, and sleep studies across payers can also lead to a more touchless exchange of data. It is important to note that complex surgeries like kidney transplants should not be touchless authorizations, as they require a more thorough review of clinical data. However, streamlining the authorization process for more standard procedures can remove a lot of junk from the system, greatly benefit patients by reducing wait times, and allow providers to focus on more complex cases.

For clients seeking a solution, what does the implementation process look like?

For provider solutions, the Availity implementation process typically takes between 30 to 90 days. Our approach is very consultative, and we integrate the Availity solution into the host system for maximum benefit. For payer solutions, we recommend adopting our end-to-end authorization solution. This starts with engaging with our portal and intelligent gateway products, and then gradually adding enhanced services such as digital correspondence, appeals, provider integration points, and ultimately, assistance with clinical decision-making.

Can you tell me about reporting and metrics, and what success looks like?

For providers, we measure success by looking at the time spent on authorizations and the number that can be processed digitally rather than manually. For payers, success involves automating as many decisions as possible, moving towards a touchless or semi-touchless process that only requires validation by someone in the utilization department, rather than going through the entire process.

Many providers and payers wish to move from manual authorizations to electronic processes. But what is the next step to achieving intelligent bidirectional collaboration between payers and providers?

Availity’s approach extends beyond mere automation and focuses on streamlining solutions for everyone involved. This includes bringing multiple payers and providers to the same table, exchanging data through various digital channels, and creating interoperability within disparate systems. We also prioritize moving towards tighter integration points to provider host systems, which removes waste and improves the quality of data.