X12’s 278 operating rules show promise for prior authorization

Study shows that pairing the transaction sets with a workflow-enabled platform could expedite the decision making process.

Prior authorization—the approval physicians must get from a health insurer prior to moving forward with a treatment plan—is one of the top headaches doctors face today, experts say.

Efforts to improve automation of the process are slow, and that’s why streamlining the prior authorization process is at the top of physicians’ priority list, according to Heather McComas, director of the American Medical Association’s Administrative Simplification Initiatives division.

Part of the frustration is the meager adoption of the HIPAA-mandated transaction set, X12 278, McComas said at a recent National Committee on Vital and Health Statistics meeting. “The industry largely agrees that the reason for this poor adoption is that we do not have a transaction standard supporting clinical documentation [for] prior authorization. This lack of an attachment standard…has paralyzed the industry,” she said.

April Todd, senior vice president at CAQH CORE, an organization that develops operating rules to simplify healthcare administrative transactions, agrees that standards are needed for attachments. Not having a standard way to exchange documentation for prior authorization is what’s holding things up, Todd said in an interview.

CORE recently conducted a priority survey of its members, which include providers, health plans, vendors, government agencies and standard-setting bodies. Like AMA, difficulties with prior authorization rose to the top of the list. This triggered CORE to form a workgroup to focus on how to standardize the exchange of clinical documentation for prior auth, according to Todd. The group has been drafting some operating rules for the exchange of attachments that soon will be made public.

In another effort to improve the workflow associated with prior authorization, CAQH CORE voted last February to set a two-day time limit for health plans that want to request additional supporting documentation on a prior authorization request, Todd said.

During the past year, CAQH CORE conducted a promising case study in partnership with Cleveland Clinic and PriorAuthNow, a platform that enhances communication between payers and providers to expedite electronic prior authorizations. The study, conducted from June 2020 through February 2021, used CAQH CORE’s operating rules and HIPAA-mandated X12 278, along with PriorAuthNow’s platform to process 80,195 Cleveland Clinic prior auths. Results showed an 80 percent reduction in staff time spent on prior authorization, Todd said.

At the conclusion of the Cleveland Clinic study, CAQH CORE found that providers were notified 6.7 days sooner of their prior authorization decisions, and cases that called for additional documentation were adjudicated 4.3 days faster. Authorizations that required peer-to-peer review were adjudicated 11 days faster. Also, the number of prior authorizations pended for additional clinical information decreased by 37.4 percent because business rules and edits within the PriorAuthNow application enabled more definitive and accurate processing, A study brief on this Cleveland Clinic case study will be released before the end of the year, Todd said.

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