Blog Post

Stop losing drug revenue to prior authorization denials

December 19, 2017

    With impending cuts to 340B reimbursement, it's more important than ever for providers to shore up drug revenue capture processes. One critical area to prevent losing revenue is in prior authorization (PA). Most commercial insurance plans require providers to justify high-cost drug use by completing PA forms, without which payers can deny reimbursement.

    Although PA is not a new cost control mechanism, it represents a growing burden for providers. More drugs than ever before require PA, and the number of insurance plans is growing too—each with its own forms and requirements. This makes it increasingly difficult for providers to keep up.

    The impact of failing to keep up is substantial: PA denials result in lost revenue, declines in provider and patient satisfaction, and delays in patient care. And in extreme cases, patients choose to forgo care to avoid the burden of paying for non-covered treatments.

    To maximize revenue capture, many organizations are re-vamping their PA staffing model and processes, and several have found that pharmacy involvement was a big factor in their success.

    The value of a pharmacy-led prior authorization team

    1. Preventing payment denials

    Pharmacy staff have a deep knowledge of medications and medication use, which can help ensure that a PA is approved. If we look at payers' top 5 criteria for determining whether to approve use of a given medication for a patient, they all fall squarely within pharmacy's wheelhouse:

    2. Improving physician satisfaction

    Some organizations allow pharmacy technicians access to medical records, so that pharmacy technicians can complete medical necessity forms on behalf of physicians. This helps save physicians time and improves physician satisfaction.

    3. Improving timeliness of care

    Pharmacy staff can often conduct PA more efficiently than other staff. At MU Health Care in Missouri, pharmacy and clinic leadership measured turnaround time (from when a physician places an order to when a payer grants authorization) for PAs completed by clinic staff and by pharmacy technicians. They found turnaround time was eight times faster when pharmacy technicians took over, which dramatically reduced delays in patient care.

    One size does not fit all—staffing models can vary

    Health systems can take different approaches to staffing a pharmacy-led PA team, depending on their specific needs and resources.

    At Froedtert and the Medical College of Wisconsin, PA technicians work in a centralized location and conduct PA for specialty medications prescribed across the system. Team members specialize based on coverage type: Six pharmacy technicians are dedicated to drugs covered under the medical benefit (provider-administered) and 11 technicians are dedicated for drugs under the pharmacy benefit. This specialization allows staff to develop expertise with specific types of PA and reduce turnaround time.

    In contrast, at MU Health Care PA technicians are located within clinics and are responsible for all PAs generated by that clinic. Technicians specialize in disease-specific drugs, regardless of whether they fall under the medical or pharmacy benefit. This kind of specialization allows staff to develop close working relationships with clinic physicians who prescribe those drugs, accelerating the exchange of information required to complete the PA process, and in turn reducing turnaround time.

     

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