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Swords and sticks

Swords and sticks

YARMOUTH, Maine – It was big news when UnitedHealthcare announced it would reduce the number of product codes requiring prior authorizations. Cigna soon followed suit and then Blue Cross Blue Shield of Michigan and others. While it was big news, it wasn’t surprising. 

The American Medical Association (AMA) has been on a fierce campaign to reduce prior authorizations. On its website, the AMA characterizes it this way: “Prior authorization is a health plan cost-control process that requires providers to qualify for payment by obtaining approval before performing a service. It is overused, costly, inefficient, opaque and responsible for patient care delays.”   

We’ve all experienced, heard or read horror stories about prior authorizations. But for the HME industry, the argument for or against prior authorizations seems to be more … complicated.  

In the complex rehab product category, prior authorizations were welcomed by the industry several years ago when CMS made them a requirement for certain codes. Complex rehab items, as we know, are expensive and prior authorizations gave providers some semblance of assurance that what they provided would be paid for and would stand up to any subsequent audits.  

This got me and Managing Editor Theresa Flaherty thinking: Is the industry for or against prior authorizations? We made it our HME Newspoll and a couple of days after the poll was posted, we had three times the number of responses that we typically get.  

It turns out, a slight majority of respondents reported they’re against prior authorizations because they are an administrative burden (58%). Most respondents also agreed, however, that prior authorizations are more important for more complex and costly equipment (nearly 73%).  

But even for more complex and costly equipment, prior authorizations can run amok, as we’ve seen more recently with ventilators. Stakeholders report that payers like UnitedHealthcare are denying prior auths for vents even when they’ve been approved in the past for ongoing need.  

Prior authorizations, it appears, are a sword that cuts both ways.  

The general consensus of the comments to the poll is that, if prior authorizations were processed as intended and in a timely fashion, respondents are all for them. But the current state of affairs, they say, is definitely not that.  

“Prior authorizations mean very little these days,” wrote one respondent. “At least 22% of PAs are denied for various reasons.”  

“Prior authorizations are just another way the commercial insurance companies rationalize denying legitimate claims,” wrote another. “They require prior auths, don’t process them quickly enough and then deny claims.”  

“There needs to be uniformity across all insurances,” wrote another. “Commercial payers refer to CMS but don’t adhere to the same criteria.”  

I do worry, with fewer prior auth requirements putting pressure on referring physicians to make sure their documentation is appropriate, HME providers will, once again, get the short end of the stick, and I’m not alone.  

“Take it a step further and remove DME companies from the medical paperwork process,” wrote one respondent. “DME companies are not medical professionals and therefore should not be put in a position to receive and interpret chart notes and medical necessity for complex home medical equipment. The prior auth process should be confined to patient-doctor-payer.”


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