Introduction
The role of prior authorization in the prosthetics and orthotics industry cannot be overstated. It aims to control costs and limit unnecessary medical device usage. It further protects the Medicare Trust Fund from improper payments while ensuring beneficiaries can receive the Prosthetics and Orthotics they need promptly. Mastering the art of prior authorization within O&P billing is challenging yet necessary for achieving timely and accurate reimbursements.
This blog will explore the key strategies for streamlining prior authorization, decreasing claim rejections, and improving revenue flow.
Understanding Prior Authorization in Prosthetics and Orthotics
Prior authorization (PA) is a process in which a request for provisional affirmation for coverage is submitted for review before an orthotics and prosthetics device is provided to a beneficiary and before a claim is submitted for payment. Prior authorization ensures that providers comply with the applicable coverage, payment, and coding rules. This step allows payors to verify that the prescribed orthotics and prosthetic devices are medically necessary. Patients with Medicare can receive O&P devices quickly and efficiently. They also appreciate the reduced stress of knowing that Medicare covers the appropriate prosthetics and orthotics.
Why Prior Authorization is Crucial for O&P Billing Success
An efficient PA process influences the financial stability of O&P practices by ensuring enhanced clean claim submission rates, increased PA approvals, and minimized reimbursement delays. According to reports published by the American Orthotics and Prosthetics Association (AOPA), delayed or denied claims contribute to 20% of lost revenue in O&P practices, and the primary reason is prior authorization errors or omissions. By improving PA accuracy, O&P practices can decrease costly denials and smooth the reimbursement path.
Key Challenges in O&P Prior Authorization
- Complexity of Payor Requirements: Depending on the type of device, medical necessity, and patient history, each payer formulates different policies on orthotics and prosthetics. With time, rules and guidelines related to O&P are frequently changing, making it difficult for the health systems to stay ahead of what they need to do to get prior authorization requests approved. It lengthens the prior authorization times, resulting in delays and denials.
- Lack of Transparency: Another common headache for providers is lack of transparency. As per the 2021 AMA survey, 62% of providers struggle to determine if prosthetics or orthotic devices require prior authorization due to changing payer rules and lack of transparency. Some insurance portals make it easy to find required information, while others require verification of patient benefits. Coordination between payers and providers is also challenging due to often unaligned objectives and workflows.
- Intensive Documentation Needs: Many payers require thorough and detailed medical records, physician prescriptions, and justifications of medical necessity for O&P devices. Insurance companies can deny any claims if there is a lack of medical necessity documentation or incomplete information about the patient.
- Time-intensive Process: Many O&P providers have reported spending an average of 30 minutes to 2 hours per authorization request. Handling many auth requests require dedicated staff, which ultimately increases the workload and leaves them exhausted and burned out. Rising payer complexity and the volume of PA make it difficult for staff to keep up, resulting in denials.
Best Practices to Streamline Prior Authorization for O&P
- Establish a Standardized Workflow
A standardized workflow ensures that every step within a prior authorization process is carried out efficiently, decreasing the risk of errors. Medical billing specialists can easily enhance auth approval rates by developing a checklist that includes payer-specific requirements, necessary documentation, and medical codes.
- Utilize Advanced Technology
In today’s fast-paced technological environment, real-time updates and integrated PA tracking in modern billing software can have a revolutionary effect. Many systems nowadays can pull claim information, notify billing staff of documentation needs, and find claim errors. These software programs with built-in PA tools can decrease human errors.
- Meticulous Documentation of PA Requirements
Inadequate documentation is another reason for orthotics and prosthetics claim denials. To mitigate this problem, the billing team needs to ensure that every PA request includes meticulous medical necessity documentation, physician’s prescription, and patient history, supporting the necessity of the device’s requirement. Double-checking each PA requirement can decrease the denial rates significantly, as incomplete documentation accounts for 25% of claim denials in O&P billing.
- Establishing Transparency Between Providers and Payers
Having frequent and continuous collaboration with payers is necessary to expedite PA requests, especially in cases where additional information or follow-up is required. Establishing transparency and a good rapport with the insurance companies can help O&P providers solve inquiries and resolve issues before they lead to claim denials.
- Hiring a Specialized Medical Billing Company
With changing regulations and payer-specific requirements, it might be difficult for the in-house billing team to be always updated on various policies. A specialized medical billing company is always on top of these policies, ensuring that each claim is compliant before submission. With years of experience in orthotics and prosthetics billing, specialized medical billing experts can streamline billing and increase the bottom line.
Conclusion
Mastering prior authorization for orthotics and prosthetics is a strategic investment that can yield substantial financial and operational benefits. By implementing standardized workflows, leveraging technology, and ensuring thorough documentation, orthotics & prosthetics providers can reduce claim denials, shorten approval timelines, and ultimately enhance the bottom line of O&P practices.
