Prior authorizations: Industry cautiously optimistic

Thursday, February 16, 2012

YARMOUTH, Maine - Eighty-five percent of HME NewsPoll respondents support CMS requiring prior authorizations for power wheelchairs and scooters, but there are a lot of "ifs" attached.

Two of the biggest: If it works to cut down on fraud and abuse, and if it means no more audits.

"As a taxpayer, I like that progress is being made to halt unnecessary payments," said Jimmy King, billing manager of Gulf Medical Services in Pensacola, Fla. "As a provider, I like the fact that it makes a required documentation beast virtually audit proof since CMS must approve every item--if the process truly works."

Prior authorizations are a hot topic in the mobility industry right now, with a seven-state demonstration project scheduled for later this year to test their effectiveness.

Respondents say they like the idea of requiring prior authorizations--if it takes some of the risk out of the reimbursement process.

"I, as well as the patient, would like to know upfront if Medicare is going to allow payment for the item rather than dispense the chair and find out six months or even a year later that they disagree with the doctor's opinion for the item," said Dwayne McCormack of Grand Saline, Texas-based Medicine Chest Medical Supply.

Eighty percent of respondents say they already submit prior authorizations for other payers. So they're familiar with the concept and they like the security it can provide--if reimbursements are not delayed. 

"I support the prior authorization process for Medicare if they could make it as smooth as other insurance companies and not hold up payment," said Lanette Douglas, a biller at Louisville, Ky.-based Goulds Discount Medical. 

Most respondents who don't support requiring prior authorizations had one of two concerns: increased paperwork and increased waiting time for patients.

"The processing time will increase and this will have a direct effect on Medicare beneficiaries," said one respondent. 

Despite these doubts, the majority of respondents think requiring prior authorizations may be just what's needed to create a better process. 

"It's simple," said one respondent. "We can fight the denial for our customers before we purchase and deliver expensive equipment."



The one potential problem is if CMS uses this as an excuse to deny 80+% of claims under the pretense of fraud recovery as they seem to have done in round 1 competitive bid areas.