The Keenan Blog

Timely and informative posts written by our experts.


Is There a Better Way for Rx Prior Authorizations?

April 30, 2021 by Diane Copenhagen

The majority of pharmacy customers receive a new medication within hours of prescription submission, but many patients receive news from their pharmacist that their insurance requires “prior authorization” before it can be filled. The customer is often confused as to why they cannot receive the medication prescribed by their doctor to treat their condition. Medications that require prior authorization are often high cost, or are a brand-name product where a generic equivalent is available.

Prior authorization is only a requirement for coverage of the medication, not an approval or disapproval of the physician’s treatment. In spite of this distinction, 79% of patients abandon treatment when struggling with prior authorization. Patients burdened with the full cost of medications not approved under prior authorizations are unlikely to fill the prescription.

Prior authorization for medications is often coupled with another requirement called “step therapy.” This means that a patient must first attempt treatment with a less-expensive generic drug before the health plan will pay for the higher-priced medication. Most times, this is a reasonable approach that is a win for everyone, saving significant health care costs and the patient paying lower copayments. However, in some cases, this can lead to delays of effective treatment during a month or more of unsuccessful step therapy.

During the coronavirus pandemic, physicians surveyed by the American Medical Association (AMA) reported that delays in care resulted because of health plan coverage review requirements. The most common of the insurer requirements cited by doctors was prior authorization for prescription medication or other treatment. Almost one-third of the physicians stated that prior authorization delays created adverse events for patients in their care, including hospitalization (reported by 21% of doctors); a life-threatening event or intervention to prevent permanent impairment or damage (18%); or permanent disability or damage, or death (reported by 9%).

Representatives of industry organizations, including the AMA, America’s Health Insurance Plans (AHIP) and the Blue Cross Blue Shield Association, among others, signed a consensus statement toward improving the prior authorization process in 2018. However, today only 15% of practitioners feel that the current prior authorization workflow emphasizes evidence-based medicine. It is estimated that the volume of prior authorization requests encompasses an average of two business days of physician and staff time each week within a practice. This level of administrative burden adds significantly to the overall cost of professional health care.

Isn’t there a better way to manage the balance between cost and care?

Clinical Care Management (CCM) is a more proactive approach to finding appropriate, cost-effective medications and other treatment for patients, involving a higher level of transparency and interaction between clinicians. While the health plan is still intervening, it is a quicker, evidence-based method for resolving conflicts between coverage and treatment decisions. Replacing bureaucratic paperwork with professional dialog significantly reduces administrative expense and time. CCM provides an independent, unbiased layer of clinical management by engaging physicians and members directly to ensure that the best possible drug therapies are chosen, based on their clinical effectiveness and overall cost to patients and the plan.

Clinical care management (CCM) is an alternative to strict prior authorization/step therapy protocols that is proven to reduce costs and improve health outcomes in all aspects of pharmacy management including acute, chronic and specialty medications. The clinical care intervention, resolution with the physician, and dispensing takes place without any noticeable delay for the patient. This leads to better patient compliance with treatment and typically lower copayments for health care consumers.


About Diane Copenhagen
Diane joined Keenan in January 2021 as a sales executive. Her expertise includes identifying specific benefits program challenges that Keenan clients are facing and connecting those clients with subject matter experts that can maximize benefits offerings while maintaining fiscally sustainable programs. Diane specifically focuses on components in her clients’ benefits programs that are the largest cost-drivers and facilitates solutions that control cost increases and yield actual savings.