AUG 24, 2014 5:36pm ET

Taking the Guesswork Out of Prior Authorization

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“Is this medication covered by my patient’s health insurance plan?” This frustrating question is faced many times each day by physicians.  Getting drug coverage answers is often tedious and time consuming due to the ubiquitous presence of prior authorization, a managed care mainstay for cost savings and patient safety.  But prior authorization (PA) -- that unreimbursed yet unavoidable anachronism -- is not going anywhere anytime soon. In fact, as more drugs become available and more beneficiaries enter the insurance pool, the use of PA is becoming more prominent.

Although only roughly 5 percent of prescriptions are subject to prior authorization, the time spent on these processes is significant.  A recent study by the Center for Health Care Transformation found that on average, physicians spend more time dealing with drug PAs than any other health plan interaction. An AMA survey of 2,400 physicians found that many were spending up to 20 hours per week on PA requests.  To add to this burden, formulary and eligibility information is often difficult to interpret or is incomplete.  Additionally, the PA requirements and the related forms and formats differ by health plan, drug class and drug, making documentation and submission time- and labor-intensive for all involved. Up to 90 percent of PA requests require a fax or phone call.

All of this comes with a hefty price tag. Physicians spend an average of $83,000 annually on interactions with insurers, including prior authorizations; pharmacists spend approximately $11,440 per pharmacist per year handling PAs; and health plans  incur  approximately $75 per request processed. But it is our patients that ultimately suffer the most from this antiquated process.  The AMA found that 69 percent of physicians report waiting at least several days to receive authorization from a plan for patient medications, and 10 percent wait more than a week. Many patients are unable to pay for medications while awaiting PA, so they reduce or just stop their prescriptions, and suffer the consequences.  

Is there a better way?  Enter electronic prior authorization (ePA). In July of 2013, after over 15 years in development, stakeholders approved the National Council for Prescription Drug Programs (NCPDP) ePA transactions within the SCRIPT e-prescribing standard. Because it is part of the e-prescribing workflow, ePA using the NCPDP SCRIPT standard enables real-time information exchange between prescribers and insurers. This significantly reduces mediation PA time and helps to ensure that patients receive the right medications under the right coverage in a timely manner.  ePA has the potential to lower costs, increase efficiency, and most importantly, free up time and resources to spend more quality time with patients.  

The benefits of using a properly implemented ePA based on the NCPDP SCRIPT standard are significant, so it pays to learn how to be a “discriminating buyer.” Current ePA solutions vary widely based on several key factors including:  the degree of ePA integration with a given EHR and its e-prescribing program; payer or pharmacy benefit manager (PBM) connectivity; absence of fax dependency and flexibility of workflow integration.   

What do you need to know?  An optimal ePA solution using the SCRIPT Standard should be able to:

* Leverage existing eligibility data and PBM connectivity through EHR integration,

* Use existing e-prescribing workflows,

* Auto-populate key fields, such as patient data, health plan information and medication history from your EHR,

* Communicate with PBMs in real time, and  

* Automatically route pre-approved e-prescriptions to the pharmacy.

When can you get ePA?  Maybe tomorrow.  Ask your EHR vendor if (or when) they can support the new SCRIPT Standard for ePA.  If it’s not available now, ask WHEN.  Ask the health plans you work with about how they support ePA, and if their contracted PBMs are involved.  Be a voice with your colleagues to ensure that the SCRIPT Standard with ePA is adopted and implemented in a collaborative fashion to ensure interoperability across the healthcare continuum. Only then might we reap all the benefits that e-prescribing offers and maintain a safe and efficient prescribing and medication fulfillment experience for the patient.
The time for ePA is now—our patients can’t afford to wait.

Dr. Murcko is president and CEO of consulting firm Cambiare, a university professor specializing in clinical informatics, and has been a practicing physician for more than twenty years.

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