Prior Authorization
What is Prior Authorization in Medicare Advantage?
Prior authorization is a process used by health plans to control healthcare costs. Most Health Maintenance Organization (HMO) plans and some Preferred Provider Organization (PPO) plans require authorization before receiving certain treatments, medical services, or prescription drugs. Preauthorization, prior approval, and pre-approval are other terms for prior authorization.[mfn referencenumber=1]Healthcare.gov, “Prior Authorization“, Accessed September 22, 2021[/mfn]
[keytakeaways]
- Prior authorization is the process of requesting coverage for necessary healthcare services.
- Submitting a prior authorization request does not guarantee approval.
- The prior authorization process takes 5-10 business days.
- Most Medicare Advantage plans require prior authorization for healthcare services.
- Original Medicare does not require prior authorization for Medicare-approved services under Part A or Part B coverage.
[/keytakeaways]
What is Prior Authorization in Medicare?
Prior authorization is requesting coverage from a Medicare Advantage plan or Medicare Part D for services that have become a medical necessity. Each Medicare Advantage and Part D plan varies in what they cover, so it is important for beneficiaries to check with their health insurance plan to see if a referral is necessary[mfn referencenumber=2]Medicareadvocacy.org, “Medicare Prior Authorization“, Accessed September 22, 2021[/mfn]. If a beneficiary has an emergency situation they will not need prior authorization from their insurer, but they will still need to pay for any emergency costs not covered by their health plan[mfn referencenumber=3]Cigna.com, “What is Prior Authorization and How Does the Process Work?“, Accessed September 22, 2021[/mfn].
Beneficiaries that have Medicare Part A and Part B (Original Medicare) don’t need any prior authorization for medical services. They are able to see any healthcare professional that accepts Medicare and get any healthcare service without delay.[mfn referencenumber=2]Medicareadvocacy.org, “Medicare Prior Authorization“, Accessed September 22, 2021[/mfn]
What is the Process of Prior Authorization?
The beneficiary’s primary care physician must first check their Medicare Advantage plan or Part D formulary to see if their medical procedure or prescription drug requires prior authorization. Once they have confirmed the beneficiary’s need for prior authorization, they will require as much information as they can provide about their condition so their insurance company can make an accurate estimation of the beneficiary’s need for the medical service or prescription drug.[mfn referencenumber=3]Cigna.com, “What is Prior Authorization and How Does the Process Work?“, Accessed September 1, 2021[/mfn]
Once the request has been submitted, beneficiaries will have to wait 5-10 business days before they receive confirmation. If a prior authorization request is denied, beneficiaries can make an appeal to Medicare to review their case if their health care provider cannot find an alternative.[mfn referencenumber=3]Cigna.com, “What is Prior Authorization and How Does the Process Work?“, Accessed September 1, 2021[/mfn]
What is the Difference Between Preauthorization and Prior Authorization?
There is no difference between preauthorization and prior authorization, they mean the same thing in the context of Medicare health insurance[mfn referencenumber=4]Healthcare.gov, “Preauthorization“, Accessed September 1, 2021[/mfn]. They both refer to the Medicare plan reviewing their beneficiary’s eligibility for a health care service based on their condition. The same is also true for the terms precertification, prior approval, and pre-approval[mfn referencenumber=3]Cigna.com, “What is Prior Authorization and How Does the Process Work?“, Accessed September 1, 2021[/mfn].