Solving the Prior Authorization Dilemma Has Many Benefits

The following is a guest blog post by Dan Kazzaz, CEO, Secure Exchange Solutions.

Healthcare is being consumed by runaway cost increases due to (the predicted) shifts in demographics and new treatment options. There is the incessant push to move from fee for service into various other payment methods such as the Merit-based Incentive Payment System (MIPs) and Advanced Alternative Payment Models (APMs) which are pushing providers toward downside risk contracts. And, federally mandated protocols, such as the Medicare Access and CHIP Reauthorization Act (MACRA) is moving physicians to either adopt downside risk or episodes of care payments.

Value-based care has clinicians and administrative leaders hungry for tools to guide planning and decision making, to deliver the best outcome for patients at the lowest cost. In view of the emerging new paradigm in accountable health care, I wonder if prior authorizations could be used within each organization as an internal cost control mechanism? In other words, I believe a streamlined, efficient and more informed prior authorization process would better serve both the patient and provider when putting together a care plan that is built on what the patient can afford.

I’ve frequently voiced concerns about the hassle associated with prior authorization because the impact on the healthcare industry is significant. It results in hundreds of hours of wasted time each year, loss of thousands of dollars for providers and payers, while patient care suffers due to the inefficiency of the process. I have talked to hospital-based physicians who are forced to keep patients in the hospital longer, due to the time it takes to get approval for a wheelchair or hospital bed to be sent home with the patient.

In today’s patient-centered care environment, we cannot continue to process prior authorizations in the same way.

All stakeholders – clinicians, providers, insurance companies and patients – suffer due to the complex nature of prior authorization. Healthcare happens as a continuum, but todays prior authorization process is a discontinuity that hampers patient care. According to a Gartner research report, “The IT systems and business processes that support prior authorizations cause inefficiency, waste and delays — frustrating payers, providers and consumers alike.”*

The main reason for this is that it requires clinical information to evaluate requests and it is clear to me that it’s the exchange and review that results in inefficiencies, excess overhead and wasted time.

I think we all agree that patient history, medical records and related documents are crucial to evaluating prior authorization, so why not enable and provide easy but secure access to current, accurate patient information at the time of the authorization request? How do we automate its evaluation?

Industry experts agree that improved standards for health information exchange is part of the answer. Until recently, standards for provider/payer clinical exchange have not been adopted to enable the secure sharing of critical health information between EMR systems and Adjudication systems.

My belief is that this is changing. Existing EMR technology / standards are now poised for implementation.  The most effective way to get started is to use Direct plus CCD. This enables stakeholders to get much of the medical necessity data to those making the decisions. However, the CCD alone is not enough, it needs to be wrapped in information about the request for authorization. In addition, it is now possible for the risk bearing entities (ACO, Payer, etc.) to programmatically evaluate the chart to make a recommendation.

Collaboration is necessary to create scalable solutions to ease the burden of the process for all parties. Solutions that are based on proprietary technology will not scale. However, to date, there is no single set of standards that can resolve the complexities of the process. Rather, to establish an automated process, the solution will likely require combining (and perhaps improving) multiple standards for this effort.

Health organizations such as the American Medical Association (AMA), America’s Health Insurance Plans (AHIP), Blue Cross, Blue Shield and others are partnering to identify opportunities to improve the prior authorization process, with the goal of promoting safe, timely, and affordable access to evidence-based care for patients; enhancing efficiency; and reducing administrative burdens.”

Much like these partnerships, I and other industry thought leaders formed the cross-specialty Innovation Messaging Taskforce Group (ITG) to address the need for standardized communications for complex exchanges that take place between all participants. (Sometimes it is between clinical and billing systems.) We believe our collective knowledge and expertise in health information exchange can help address these complexities.

Currently, the ITG focus is on how best to identify the lowest cost, most scalable set of standards to help the healthcare industry improve clinical financial decisions (whether it is a prior authorization or other message). We are working to combine multiple existing standards into a highly scalable workflow. Our immediate aim is to define and pilot this combination of standards. The group believes that using technology and standards already embedded in the EMR is the fastest path to solving this very important, but burdensome, process.

According to Gartner, “U.S. healthcare payer and provider CIOs advancing healthcare payment and administrative systems modernization should strive toward personalized and real-time prior authorizations by implementing artificial intelligence (AI)-enabled tools and clinical data integration at both payers and providers.”*

We whole-heartedly agree with Gartner! As we implement faster and more efficient data movement, we can then enable the next phase – applying artificial intelligence (AI) that can give prior authorization answers in near real-time!

Join me and other industry leaders to collaborate on and work toward solving this critical industry issue.

* Gartner, Healthcare Collaboration Point for CIOs: Prior Authorizations, Bryan Cole, Jeff Cribbs, Mandi Bishop, 4 June 2019

About Dan Kazzaz
Dan Kazzaz has 30+ years of experience in automating business-to-business (B2B) data interchange. Dan has been an active participant, chair and board member of the American National Standard Institute’s (ANSI) Accredited Standards Committee (ASC) X12 – the federally mandated organization for healthcare exchange standards (EDI).

About Secure Exchange Solutions
Secure Exchange Solutions sets the standard for seamless, scalable, secure connectivity across organizational boundaries. As an industry-leading health information service provider, Secure Exchange Solutions protects, streamlines and delivers sensitive and critical health care information while ensuring compliance and improving efficiency and quality. Hospitals, health systems, physicians, health plans and application partners rely on Secure Exchange Solutions for integrated secure communications that expand their reach. Secure Exchange Solutions is a proud sponsor of Healthcare Scene. Learn more at