Prior authorization is a process used by insurance companies or third-party payers before they agree to cover prescribed medications or medical procedures. Insurance providers require prior authorization for reasons such as age, medical necessity, the availability of a generic alternative, or checking for drug interactions. A failed authorization can result in a requested service being denied, or an insurance company requiring the patient to go additional steps. The process can require a patient to try medication or a service preferred by the insurance provider, typically considered either more cost effective or safer, before the insurance company will cover a different service.
Steps for Obtaining Prior Authorization or Precertification:
If a decision for authorization is not reached, and should require review by a nurse, continue to follow up routinely until an authorization number is obtained.
Once your claim has been submitted using the 837 ANSI format, your billing office will receive an electronic confirmation that your claim was received from the payer. Since your office cannot submit attachments electronically, your claim may deny.
If your claim is denied, the billing staff may elect to appeal the denial.
When submitting the claim, complete the CMS 1500 form. In box 19 of the form, your billing staff may want to refer as to what is being performed by the physician. ie., PTNS
If your payer accepts the paper claim, attach all necessary documentation to help in the processing of your claim form.
Determine the payer's appeals process
Often, the payer may request certain documentation from your office in order to process your claim correctly. Some requests may include: letter of medical necessity, copy of the patient's medical history and operative report, identification of a comparable procedure(s) to assist the payer in establishing a payment level, and any other documentation that may aide in the payer overturning their decision.
Once all of the information is compiled, send your appeal according to the appeals process for the payer. Be sure to submit the appealed claim to the correct address. Oftentimes, the payers have a separate address or appeals unit that these kinds of problems must be sent to. Resubmitting the claim to the original address may result in a "duplicate" claim denial.
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