Life Sciences

If a prior authorization request gets approved, can it still harm patient care?

Syam Palakurthy

Syam Palakurthy

CEO, CoFounder

We often hear the question, do prior authorizations (PAs) actually affect patients? Everyone knows they burden providers, but does that burden hit patients? For most specialties, the answer is an unambiguous yes. There are probably five physicians in the entire country who don't believe PAs can harm patient care — and all five of them work for insurance companies!

But what about cases when PAs almost always get approved? Retina medicine, one of the specialties we work with, has a higher PA approval rate than the industry-average. In a few rare cases, we’ve even seen specific payers that approve 100% of requests. That raises a question for retina medicine, and any other specialty that uses specific drugs/procedures with high approval rates: if most of those PAs get approved, do those PAs make a difference for patients?

No one doubts that PAs are a pain: they absorb huge amounts of staff time and can - when something slips through the cracks - create a major financial issue for the practice. But does that affect patients?

If you ask doctors and their staff (which we have!) they’ll tell you it absolutely does. Just the existence of a PA can delay urgent treatment, and the manual, tedious nature of the process raises the likelihood of errors or back-and-forth with payers that further impedes treatment. In a 2019 American Academy of Ophthalmology survey, 88% of respondents said that PA requirements often or always delayed care for patients and 90% reported the process has a negative impact on patients’ clinical outcomes [3]. Clearly the folks delivering care witness a detrimental impact to patients.

Does the data back that up? We took a look at the last 5,000 PA requests — from every region of the country — submitted through our software. Our data shows a denial rate of ~5% [1, 2] — lower than many specialties, but not trivial either. After all, those denials all represent an instance where a highly-trained physician believed a therapy was appropriate, but a bureaucratic process stymied that recommendation. Moreover, denial rate alone describes a binary outcome that misses the nuances of a patient experience. A patient can get an approval, but if it’s four weeks late or requires multiple reschedules, that represents a terrible experience and potentially irreversible clinical harm.

No alt text provided for this image

To better see the nuance, we use a metric we call Approval Percentage Prior to Date of Service: this looks at whether the payer approved the request, and if so, whether the approval arrived before the intended date of service for the patient to start getting the therapy. This metric speaks both to the PA's resolution and its timing impact on patient care. It tells a bleak story: 77% of PAs were approved prior to the intended date of service — nearly one out of every four approvals affected patient care because the response took too long. And that’s just the PAs where we see a resolution one way or another; if we include the PAs that don’t have a resolution yet, we see 66% of PAs were approved prior to the intended date of service, and it drops to 57% for some branded retina drugs.

Diving into payer-specific data shows that not all payers are created equal in this regard. The chart above shows the Approval Percentage Prior to Date of Service for 15 of the largest payers in our data by PA volume, from highest to lowest volume. The variation ranges from 18% all the way to 100% for one standout payer. Even patients with fast-responding payers get harmed, because as any operations expert will tell you, massive variation makes it harder to create consistent predictable practice workflows that ensure all patients get timely and effective care.

We’re data geeks here at SamaCare, so it’s easy for us to get caught up in the numbers; but like all things in healthcare we need to constantly remind ourselves of the human stories behind those numbers. Some of our practices have patients that drive hours to get to their appointment, many who require a caregiver to get them there and back. Sometimes those patients will experience irreversible vision loss if they receive treatment even a week later than needed. So every uptick in that percentage means much more than a number on some dashboard. It’s woman who can — literally — see her grandson walk across a graduation stage; a father who does not have to ask his working-age daughter to take another day off work to drive a couple hundred mile roundtrip for a rescheduled appointment. Those are outcomes worth pursuing.

Sources and Notes

  1. From SamaCare prior auth data.
  2. Here we categorized “No PA Required” responses as approvals.
  3. https://www.aao.org/newsroom/news-releases/detail/new-survey-highlights-growing-insurance-problem

Life Sciences

If a prior authorization request gets approved, can it still harm patient care?

Syam Palakurthy

Syam Palakurthy

CEO, CoFounder

We often hear the question, do prior authorizations (PAs) actually affect patients? Everyone knows they burden providers, but does that burden hit patients? For most specialties, the answer is an unambiguous yes. There are probably five physicians in the entire country who don't believe PAs can harm patient care — and all five of them work for insurance companies!

But what about cases when PAs almost always get approved? Retina medicine, one of the specialties we work with, has a higher PA approval rate than the industry-average. In a few rare cases, we’ve even seen specific payers that approve 100% of requests. That raises a question for retina medicine, and any other specialty that uses specific drugs/procedures with high approval rates: if most of those PAs get approved, do those PAs make a difference for patients?

No one doubts that PAs are a pain: they absorb huge amounts of staff time and can - when something slips through the cracks - create a major financial issue for the practice. But does that affect patients?

If you ask doctors and their staff (which we have!) they’ll tell you it absolutely does. Just the existence of a PA can delay urgent treatment, and the manual, tedious nature of the process raises the likelihood of errors or back-and-forth with payers that further impedes treatment. In a 2019 American Academy of Ophthalmology survey, 88% of respondents said that PA requirements often or always delayed care for patients and 90% reported the process has a negative impact on patients’ clinical outcomes [3]. Clearly the folks delivering care witness a detrimental impact to patients.

Does the data back that up? We took a look at the last 5,000 PA requests — from every region of the country — submitted through our software. Our data shows a denial rate of ~5% [1, 2] — lower than many specialties, but not trivial either. After all, those denials all represent an instance where a highly-trained physician believed a therapy was appropriate, but a bureaucratic process stymied that recommendation. Moreover, denial rate alone describes a binary outcome that misses the nuances of a patient experience. A patient can get an approval, but if it’s four weeks late or requires multiple reschedules, that represents a terrible experience and potentially irreversible clinical harm.

No alt text provided for this image

To better see the nuance, we use a metric we call Approval Percentage Prior to Date of Service: this looks at whether the payer approved the request, and if so, whether the approval arrived before the intended date of service for the patient to start getting the therapy. This metric speaks both to the PA's resolution and its timing impact on patient care. It tells a bleak story: 77% of PAs were approved prior to the intended date of service — nearly one out of every four approvals affected patient care because the response took too long. And that’s just the PAs where we see a resolution one way or another; if we include the PAs that don’t have a resolution yet, we see 66% of PAs were approved prior to the intended date of service, and it drops to 57% for some branded retina drugs.

Diving into payer-specific data shows that not all payers are created equal in this regard. The chart above shows the Approval Percentage Prior to Date of Service for 15 of the largest payers in our data by PA volume, from highest to lowest volume. The variation ranges from 18% all the way to 100% for one standout payer. Even patients with fast-responding payers get harmed, because as any operations expert will tell you, massive variation makes it harder to create consistent predictable practice workflows that ensure all patients get timely and effective care.

We’re data geeks here at SamaCare, so it’s easy for us to get caught up in the numbers; but like all things in healthcare we need to constantly remind ourselves of the human stories behind those numbers. Some of our practices have patients that drive hours to get to their appointment, many who require a caregiver to get them there and back. Sometimes those patients will experience irreversible vision loss if they receive treatment even a week later than needed. So every uptick in that percentage means much more than a number on some dashboard. It’s woman who can — literally — see her grandson walk across a graduation stage; a father who does not have to ask his working-age daughter to take another day off work to drive a couple hundred mile roundtrip for a rescheduled appointment. Those are outcomes worth pursuing.

Sources and Notes

  1. From SamaCare prior auth data.
  2. Here we categorized “No PA Required” responses as approvals.
  3. https://www.aao.org/newsroom/news-releases/detail/new-survey-highlights-growing-insurance-problem