Why Prior-Authorization Automation is More Than a Trivial Need for Health Plans?

Claiming for health insurance is a lengthy process. Though patients are not subjected a tedious claim process, the provider and payers are . Prior Authorization is the very first step in the process of claim. This is a permission from the health plans for the payment of the treatment. Without prior authorization some medical treatments cannot be provided. Prior authorization helps payer understand whether the tests required are necessary or not , which in turn can help them save money. 

Challenges Health Plans Encounter with Prior Authorization

Initial Pre-authorization costs payers of $18.4 billion annually. That’s a lot of money. 

  • Manual Processing:

According to CAQH, 87% of prior authorizations are submitted by Provider either partially or fully.  This is due to the fact that not all the information is available to the provider while sending the prior authorization request. This causes a lot of back and forth from both parties. Each submission has to be manually processed by prior authorization specialists who sort, collate and upload the information on the appropriate care management software. 

  • Operational Cost:

Just like how providers have a team to send across the pre-auth, payers have a team to process faxes and review the prior authorization requests. This team typically consist of nurses and medical directors. Prior authorization typically takes somewhere between 24 hours to 2 weeks depending on the complexity of the case. Health plans also have to employ call center executives to attend provider calls for prior authorization request status. This puts a huge dent in the payer cost management.  

  • Compliance Violation:

Since prior authorizations requires lot of medical documents to be sent to payers, providers might sometime goof up, which will delay the pre-authorization. The National Institute of Quality Assurance (NIQA) requires payers to send a yay or nay notification to the providers within 14 days from the date of prior authorization request. Overwhelmed with prior-auth requests, the clarifications over phone calls, emails and faxes are less than the ideal process for payers to communicate the status on the prior authorization, which would make them vulnerable to compliance violations. 

  • Poor Member Engagement:

Pre authorization issues are one of the top reasons for dissatisfactions among members. Disapproval in prior authorization can result in rejection of payment for any medical tests or treatment, which makes them think payers are blatantly rejecting their pre-auth without any reason. Some payers use third party vendors to deal with prior authorization because of the sheer volume of requests and documentations that needs verification. Patients are pushed even more into the realm of dissatisfaction knowing that their pre-auth was denied by a third party. 

Enter Prior Authorization Automation Solution 

Here’s a Pictorial Representation example of RPA Bots at Work for a Pre-Authorization Request from Provider

prior authorization automation solution


How Healthcare Payer Automation Solution Solves these Pre-Authorization Challenges? 

  •  Saves time and Ensures Quality:

Infusing your prior auth engine with RPA can speed up processing without executives manually collating, adding information to the appropriate care management system. This process can be automated via RPA bots which can not only save time, but also reduce errors and improve the quality of the entire process while reducing burden on all the parties involved. 

  • Resource Cost Saving:

According to a technology company called Olive, cost of an initial prior authorization comes to $80-$130 per request. With automation in place, manual intervention will be less, employing manual resources to provide status update to providers is reduced, hence the overall cost is reduced. This will help payers in investing that money into other aspects to improve member/patient experience. 

  • Auto Approval and Compliance:

As per NIQA, payers have to notify the status of pre-authorization to providers within 14 days from the date of the request. Since there are many parties from the payers involved in verifying the documents, it may go beyond that period and will subject health plans to compliance violations and fines. Implementing healthcare payer automation solution can drastically change the way payers look at delays and compliance problems. RPA bots can help with alerts and notification functions. Certain pre-auth requires further investigation from medical directors, which might get delayed due to other priorities on their plate, instead of internal executives following up, a bot can be programmed to send alerts and notification to the responsible entity and ensure there isn’t any delay in reviewing the case. 

  •  Improved Member Engagement:

Infusing your prior auth engine with automation capabilities like queue management automation can provide appropriate level of priority to each member case based on criticality factor. This can speed up the prior authorization process for members in different category and improve overall member engagement and experience.  

Related: [Whitepaper] RPA in Healthcare: The Areas for Automation 


Above are the reasons why Health plans need to consider automating the pre authorizations process. Nalashaa has been helping the US healthcare industry navigate through technology challenges for over a decade now. We specialize in payer, provider and HIT regulations along with application knowledge. If your prior authorizations process is costing you more than it should, maybe RPA is the solution. Drop us a note to info@nalashaa.com 

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Prateek Shetty

Prateek Shetty

Prateek is a B2B tech marketer with a keen interest in content marketing. B2B writer by day, Netflix junkie & gamer by night.

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