By Gene Ransom
1:45 PM EST, February 9, 2012
At a time when physicians and policymakers alike are being asked to reduce health care costs without sacrificing quality care, it's crucial that we unleash the enormous potential for savings that could come from exciting new advances in health information technology.
There's no better example of the revolution under way in medical care than electronic medical records and electronic prescribing systems, which not only allow doctors to generate prescriptions and orders electronically and transmit them directly, but provide instant access to drug reference information and a patient's complete medical history.
E-prescribing and the electronic ordering of procedures can cut costs by introducing much-needed efficiency to a system weighed down by paper and protocols. It will expedite the 3 billion prescriptions written in the U.S. annually and reduce preventable medical errors caused by illegible handwriting and harmful drug interactions.
However, according to a new report from the Maryland Health Care Commission (MHCC), one of the greatest impacts of e-prescribing and ordering procedures electronically could prove to be their potential to expedite a dysfunctional insurance company protocol called "prior authorization." Prior authorization requires doctors to go through a number of extra steps to obtain the health insurer's approval before it will agree to pay for a prescription medication, medical test or procedure.
The problem with the current prior authorization process is that the requirements vary widely from one insurer to another, each of which also has a different process for submitting prior authorization requests. In most cases, prior authorization must be done manually, meaning that providers spend valuable staff time on the phone or printing and faxing forms, and many requests require additional follow-up for clarification or more information.
Needless to say, this inefficient system is extremely costly, with one recent study estimating that insurers spend $75 on each prior authorization request. It's also harmful to patients, who are often forced to wait days for insurers to issue approvals, and weeks or even months to resolve denials.
Thanks to new technology, however, we now have the ability to streamline the current paper-based system for filing prior authorizations. In a report that will be presented to legislators this month, the Maryland Health Care Commission lays out a plan to move to a standardized, electronic system for filing and processing prior authorization requests. The process proposed by the commission would create a single electronic method for submitting requests — no more printing and faxing forms or endless follow-up phone calls between doctors' offices and pharmacies.
While this may sound like a small change, it could have a big impact on both the cost and quality of care in Maryland and across the country. At MedChi, the Maryland State Medical Society, we recently conducted a survey of our member physicians across the state on this issue. They said that having the ability to process prior authorization requests electronically would give their patients quicker access to medical services, reduce administrative costs and enable them to spend more time with patients.
Unfortunately, the Health Care Commission guidelines are only voluntary; insurers aren't required to adopt a simple, user-friendly electronic prior authorization system. We are very concerned insurers won't make the required changes.
In fact, in MedChi's survey, 87 percent of doctors who are already using e-prescribing systems said that they have faced obstacles to getting prior authorization from insurers electronically. Specifically, they complained of a lack of transparency from insurers about when pre-approval is needed; having outdated information about prior authorization requirements; or insurers simply failing to upload requirements onto the e-prescribing system.
If history is any guide, insurance companies aren't going to modernize the system on their own. That's why Sen. John Astle and Del. Shawn Tarrant have introduced legislation to empower the state commission to streamline the prior authorization process and enforce the guidelines laid out in their report. Legislators should take up this bill right away.
Expediting prior authorization would reduce medical costs and help patients overcome hurdles to get care they need. Advances in health information technology like e-prescribing have the potential to make health care in Maryland more efficient, more effective and more affordable — but doctors and their patients will not be able to reap the benefits until the legislature acts.
Gene Ransom is CEO of MedChi, the Maryland State Medical Society. His email is firstname.lastname@example.org.
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