10/16/2024

Overcoming Prior Authorization Challenges With Technology

The latest survey from the American Medical Association (AMA) reveals the significant challenges posed by prior authorization in healthcare. Prior authorization, a process insurers use to manage healthcare utilization and control costs, often disrupts patient care, burdens physicians with administrative tasks, and wastes healthcare resources.

The Consequences of Prior Authorization
Conducted in December 2023, the AMA survey paints a stark picture of the impact of prior authorization:

• Patient Harm: Nearly one in four physicians (24%) reported that prior authorization has led to serious adverse events, including hospitalization, permanent impairment, or death. Furthermore, 93% of physicians observed a negative impact on clinical outcomes, and 94% noted delays in accessing necessary care, often causing patients to abandon their treatment due to struggles with health insurers.
• Administrative Burdens: Physicians complete an average of 43 prior authorizations per week, consuming about 12 hours of physician and staff time. Over a quarter (27%) of these requests are often or always denied, contributing to increased burnout, with 95% of physicians indicating that prior authorization significantly increases their burnout.
• Wasted Health Resources: An overwhelming 87% of physicians stated that prior authorization requirements lead to higher overall healthcare utilization. This includes diversion of resources to ineffective initial treatments, additional office visits, urgent or emergency care, and hospitalizations, indicating significant waste rather than cost savings.

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