Medicare’s annual enrollment period has started, and you know what that means: a slew of commercials suddenly appearing on television for Medicare Advantage plans.
The advertising appears to be working. Enrollment in Medicare Advantage has more than doubled over the past decade to more than 26 million people this year. The private health plans, which are an alternative to traditional Medicare, account for 42% of the total Medicare population.
The growth of Medicare Advantage, though, has increased the administrative burden on the healthcare system. A study by the Kaiser Family Foundation found that four in five Medicare Advantage enrollees are in plans that require them to obtain authorization from insurers prior to receiving care. Conversely, traditional Medicare does not require prior authorization for the vast majority of services.
The job of managing prior authorizations generally falls on providers, and it’s an enormous undertaking. . A recent American Medical Association survey found that 85% of physicians describe the burden of prior authorization as high or extremely high. Moreover, an overwhelming majority of physicians report that prior authorization interferes with the continuity of care.
Industry stakeholders, including the AMA and an association representing the largest medical insurance companies, found some common ground and issued a statement in 2018 on some possible reforms to reduce prior authorization hassles. One of the opportunities for improvement was to move toward adopting electronic transactions to streamline the cumbersome process. Three years later, phone and fax are still the main tools used to complete prior authorizations. Nearly 80% of authorizations are completed manually.
The adoption of electronic prior authorization transactions could take years, so let’s look for ways to foster better communications and transparency between providers and health plans to minimize care delays.
Inside hospitals, for example, nurse case managers are the quarterbacks of care, wrangling insurance companies, providers, families, and physicians to find medical services for patients who need care following treatment for injury or illness. The Kaiser study found ordering durable medical equipment and transitioning patients to skilled nursing facilities often require approval from health plans. The sheer volume of requests case managers have to manage has become overwhelming, and workloads are leading to burnout.
1. Integrate workflows: Case managers are spending 60% of their time obtaining authorizations so they can discharge patients to the next level of care. They are often working across multiple systems to send referrals, share medical records, and request authorizations. We must support them with tools that combine workflows more efficiently, track the status of authorizations, and hold care partners and insurers more accountable.
2. Elevate communications: The lack of follow-up on prior authorizations is a significant problem. In one year, the Cleveland Clinic, for example, had to send repeat faxes 430 times each month because the first one wasn’t acted on by health plans, according to a published report. And at least 2,000 times a month, five-plus calls had to be made to insurers regarding the status of a prior authorization request.
Manage urgent and sensitive communications with insurers in the same platform as referrals so that requests are patient-centered. By doing this, case managers can set deadlines that align with potential discharge times. Requests can be automatically updated with the latest communication, inbound and outbound. And since every communication is time-stamped, health systems can measure responsiveness and mobilize resources to reduce delays that unnecessarily lengthen hospital stays.
3. Improve visibility: The patient hand-off from a hospital to a skilled nursing facility is complicated. The SNF needs approved authorization before admitting a patient. Hospitals often have to get their own approvals for medications and other medical services for the same patient. But often neither provider has clear visibility into the other’s actions or status. No wonder patients end up staying in hospitals longer than they have to. Invite care partners to track and share statuses of all these requests to maximize transparency, actionability and movement. This will encourage more collaboration between hospitals and post-acute providers because they both have incentives to secure insurance approval in a timely fashion.
It’s no secret that fragmentation is a major problem in healthcare, and it impacts everyone — especially case managers who work across organizations to make the messy machine of healthcare work. They are spending more time managing prior authorizations, as more people enroll in Medicare Advantage plans.
There are meaningful opportunities to simplify the administrative complexity, reduce barriers to care and generate savings for the medical industry. Innovation can restructure workflows to ease delays, encourage collaboration, and hold all parties accountable in real-time.
About Russell Graney
Russ Graney is the CEO and founder of Aidin, a healthcare technology company making care transitions easier for everyone. Aidin works with some of the largest health systems in the nation to reduce length-of-stays and readmissions by incentivizing speed and quality across the care continuum.
