Skip navigation
9

Linda Collins Blogger

Prior Authorization is Not a Guarantee of Payment

Posted by Linda Collins | July 14, 2017

Your patient is in need of a prosthesis or orthosis. You call the private insurance company to obtain prior authorization. The insurance company phone representative does a review of the case and offers a prior authorization number. You also get a message stating that prior authorization is not a guarantee of payment. What does this mean?

A health plan may have policies in place to obtain prior authorization for certain procedures or services. This allows the plan to identify potentially high-cost claims. Typically, the prior authorization process involves a review of the patient's eligibility, the services being requested, and the basic medical necessity of the service or item. The idea is that the health plan reimburses for medically necessary covered services. The final determination of whether to pay for service is made by thoroughly reviewing the patient's plan policies and the payer's medical coverage policy.

There are several reasons why a claim may be denied after it is submitted, even if prior authorization was made:

  1. The patient has become ineligible for services and is no longer covered by the health plan.
  2. Services are not billed with the HCPCS codes identified in the prior authorization process.
  3. Additional services, not included in the initial prior authorization, are submitted on the claim.
  4. A detailed review of the medical records indicates the service is not medically necessary according to the payer's medical coverage policy.

What does this mean for you?

Be sure to distinguish prior authorization and benefit eligibility. If you call to determine if the patient does have insurance coverage and is eligible to receive services, this is not the same thing as receiving prior authorization on a specific service.

Confirm your claim matches the prior authorization approval. In other words, are you billing for the exact codes referenced in the prior authorization? If you make changes or additions, call the payer to update the prior authorization number.

When you call for prior authorization, be sure to document whom you spoke with and what times/days you talked. This will be helpful if, in fact, you do have to file appeals.

Understand the payer's coverage policy and have documentation to support the medical necessity of the item, as outlined in the policy.

If your claim is denied, even after prior authorization, be sure to understand the reasons for denial and follow the payer's appeal process.

Össur offers assistance with prior authorizations for prosthetic products and certain orthotic products. If you would like information about this service, please contact us at Reimbursement411@ossur.com.

Össur R&R

The Source for O&P Reimbursement & Regulatory News & Analysis

If you have any questions for Össur’s Reimbursement Team or about Össur’s Reimbursement Services, please contact us at reimbursement411@ossur.com