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July 5, 2017 Readers Write No Comments

Moving the Adoption Needle on Electronic Prior Authorization: What Stakeholders Can Do
By Tony Schueth

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Tony Schueth is CEO and managing partner of Point-of-Care Partners of Coral Springs, FL.

Prior authorization (PA) is a major pain point for both prescribers and payers (health plans and PBMs). That is because there are significant administrative costs and patient-safety issues associated with today’s antiquated paper-phone-fax PA processes. The number of PAs is increasing, causing stakeholders to look for a solution to keep ahead of the PA curve. The answer is electronic PA (ePA), which is available today. Yet, while headed in the right direction, uptake isn’t where we’d like it to be.

Manual prior authorization and utilization review create burden on providers and payers alike. According to a recent article in Health Affairs, physicians spend $37 billion annually ($83,000 per doctor) thrashing out PA and formulary issues with payers. According to another estimate, doctors spend 868.4 million hours on PA each year, not counting time devoted by other staff members. Payers incur up to costs of $25-$40 per PA, plus risk to downstream CMS rebates and medical cost savings.

Perhaps most importantly, the difficulties inherent in trying to obtain a PA significantly affect the quality of care and patient safety. According to a survey by the American Medical Association (AMA), most physicians experience a delay in excess of a week for their PA request to be processed. Some 70 percent of prescriptions rejected at the pharmacy require PA; of those, 40 percent are eventually abandoned due to the complex, paper-based PA process. The PA process impacts more than 185 million prescriptions each year and results in nearly 75 million abandoned prescriptions.  

These issues will only be exacerbated as demand for PA increases. This is due to several factors. First is the robust pipeline of new specialty medications, the majority of which require PA. Second, the demand for specialty medications is rapidly increasing because, in large part, of the rising number of chronically ill patients who rely on specialty medications.

Because of increased specialty medication utilization — coupled with the reliance on today’s antiquated paper-based processes — prescribers, pharmacies, and payers will be unable to keep pace with the anticipated flood of new specialty prescriptions and related PA requirements. Patients will have delays in obtaining needed therapies or will forego them altogether if prescriptions are abandoned due to administrative delays. Quality and patient safety are at stake.

Now that the need for process improvement and efficiencies is imperative, stakeholders are beginning to coalesce around the promise of electronic prior authorization (ePA). This solution is in keeping with the trend toward automation of healthcare and the wide-spread adoption of electronic prescribing, which is used by 75 percent of ambulatory physicians. Standards to support the ePA transaction are in place. Vendors are emerging that can handle the transaction. States are jumping on the ePA bandwagon, with several requiring use of ePA in the near future and others expected to follow suit. It won’t be long before the federal government is expected to mandate ePA as well.

That said, use of ePA is not to the point of bringing robust value for all stakeholders. Electronic health record (EHRs) can support the ePA process, but not all of them have that capability. Physicians may not know that their EHR supports ePA and it could be integrated into the workflow.

What can be done to move the ePA adoption needle? Here are some things stakeholders can do now.

Prescribers should:

  • Ask their EHR vendor about their system’s ePA functionality. If it is not available, push for it as an enhancement request.
  • If integrated ePA is available, start using it as a way to improve return on investment (ROI) in the EHR. Electronic PAs get adjudicated much more quickly than prior authorizations submitted on paper via fax. ePA also can reduce costs and improve the quality and safety of patient care. These metrics are increasingly important ingredients of value-based care, alternative payment models, and related reporting requirements.

EHR vendors should:

  • Make prescribers aware of their product’s ePA functionality and how it is used. This educational component provides value to the buyer and also could be a differentiator in the market.
  • Get ahead of regulatory mandates by either the federal government and the states. Savvy vendors will not wait for the regulatory shoes to drop and then play catch up. This can be costly and affect market share.
  • Build competitive advantage. While some of the major EHRs have incorporated ePA, many of the small and medium-sized EHRs have not. Practices and integrated delivery networks are overwhelmed by the growing number of PAs. They are demanding relief, which can only be solved through the availability of ePA. This also is an attractive selling and retention point.

Health plans and PBMs should:

  • Adopt ePA functionality that is beyond the basics. Research shows that many PBMs have minimal ePA processing capabilities. Improving ePA processes and question sets will improve efficiency, reduce costs, and add value.
  • Push prescribers to adopt and use ePA. A legitimate ROI can be demonstrated, but only if functionality is used.
  • Take full advantage of the feature set included in the NCPDP SCRIPT standard for ePA. Supporting more of the features available in the standard will reduce the need for attachments, thus reducing turnaround times and increasing efficiencies. This translate into cost savings.

Advancing ePA requires focused effort by all stakeholders, but the time is right and the technology is ready.

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