Reforming the prior authorization process

June 5, 2020

When it comes to top physician frustrations, prior authorizations rank near the top of the list, right next to poorly designed EHRs.

When it comes to top physician frustrations, prior authorizations rank near the top of the list, right next to poorly designed EHRs.

Jack Resneck, M.D., a dermatologist and immediate past chair of the American Medical Association board of trustees, has watched prior authorizations steadily expand in scope, become more time consuming for doctors and negatively affect patient care. Resneck is now leading a call for reform of the prior authorization process that would return it to its original purpose and free physicians from excessive interference in the doctor-patient relationship. He recently published data and outlined the changes needed for prior authorizations in JAMA.

Medical Economics® spoke with Resneck about what has gone wrong with prior authorizations and the challenges of fixing them. The interview has been edited for clarity and brevity.

Medical Economics®: How did prior authorizations get so out of hand?

Resneck: When prior authorization came into being, it was really focused on brand new drugs with very high price tags where the evidence was still accumulating, and maybe where there was variation in care. It has gotten to the point where I, as a dermatologist, am literally doing prior auths every day on generic topicals like cortisone products that were invented in the 1960s. So the expansion - and we’ve seen this in the data - has been dramatic. It’s no longer focused on high-cost drugs that are unique or on new drugs. It’s no longer focused on outlier physicians in any way. It really just seems to have taken on a life of its own.

ME: Can health plans possibly be saving money? They still have to administer all the prior authorization requests, staff the phones and facilitate the review process.

Resneck: It’s a good question. I wonder the same thing, although my experience is that the people on the other end who are adjudicating my prior auths are typically not of the same specialty. I don’t always know the level of training of the person at the other end.
But yes, there are certainly people taking all of these appeals and processing all these things. I have heard from some pharmaceutical company executives, when we sat down with them, that even for things that get approved 95% of the time, they still have the feeling that they’re saving a lot of money on the other 5%. It just seems ridiculous and at the end of the day, you don’t want to be doing cost savings on appropriate treatments that patients actually need. This happens to the extent that my patients’ care is getting delayed because they’re waiting days and days while this process goes on, until they just give up and don’t go back to the pharmacy.

ME: Your report mentioned that the percentage of people who abandon their prescriptions and never pick them up is relatively high, correct?

Resneck: I think about 37% of prescriptions that are initially rejected for one reason or another when a patient goes to the pharmacy are never picked up. That’s really disappointing. There are also some studies that I quoted in the paper, particularly in the mental health arena, where we actually see increased costs for some of these patients because their underlying disease flares and gets out of control. So, ultimately, they have more expensive care, more hospitalizations, more impacts on their life and health. Maybe the insurance company saved a few dollars up front, but it’s costing them and patients in the long run.

I had a patient who had severe lifetime eczema, whose life had really been changed by a biologic. I’m fairly conservative about prescribing biologics, but for this patient, it was completely appropriate. They actually got theirs approved initially, but a year later it came time for renewal. I dutifully filled out the pages of paperwork demonstrating that this patient had had amazing improvement. They were able to sleep again, they were able to work again and therefore, this was a good medication for this patient and they deserved to get it reauthorized. What I got back was a rejection, saying the patient no longer met the severity criteria. Someone is just looking at a screen and saying, “well, the disease isn’t extreme enough.” The irony is, it’s because the drug is working. They were suggesting that I take the patient off therapy for a couple of months, let them have a bad flare up, and then they would qualify again. It’s absurd, and for that one instance, it led to over 20 phone calls and several hours on my part arguing on the phone. It has gotten ridiculous; the health plans will tell you this is focused on outliers but it’s really not.

ME: Do patients understand that this is a health plan issue or do they sometimes blame the physician?

Resneck: Well, I think both pharmacists and physicians are the ones who are face-to-face with the patient, so we are a lot easier to access than their health plan. We’re the first to really hear about these frustrations and I think the opacity of the entire drug pricing and prior auth pipeline has gotten to a point where it is difficult for patients to know about. And frankly, we have times as physicians where the transparency is not ideal in terms of what we can see as well. So, you’ll have some plans where these decisions are made by the pharmacy benefit manager and sometimes it’s a plan issue. Sometimes those two blame each other, and you end up calling back and forth. I think for all of us the opacity is a problem.

One of the things that I asked for in this report, which you would think in this era of computers and digital health would not be a big ask, is better information at the point of care. When I am sitting down in an exam room with a patient and we’re talking about treatment options, and there may be four or five things that would work well, it would help if I could type the first choice into my e-prescribing system in my electronic health record. And then it would pop up immediately and tell me whether that option was or wasn’t on formulary for that patient, whether it required prior auth or not, how much the co-pay would be for that patient, and I could quickly do the same for any alternatives.

But while there’s some technology that occasionally allows for that, the majority of the time that information is not made available to us by the health plan or the pharmacy benefit manager. Often, we don’t end up finding out these things until the patient gets to the pharmacy. The formularies and the prior auth requirements change week to week, so it’s not even predictable. We’re asking for that transparency. It’s point of care and frankly, it would help us at times when there are two things that would both work well and are safe, and one costs way more than the other; we would be happy on behalf of our patients and the health system to be good stewards of resources and choose the highly effective thing that happened to be cheaper. But we don’t see that information in front of us, and that really surprises our patients.

ME: What else needs to happen to fix this this issue?

Resneck: Well, one of the main things is just getting the volume of prior auths back into a reasonable space. As physicians, we’re realistic and we don’t expect that to magically vanish tomorrow. We are really asking to rightsize this. If there are medications or procedures for which prior authorizations are ultimately approved an overwhelming majority of the time, those things shouldn’t be on the prior auth list. Medications that have no cheaper, safe alternative shouldn’t be on the prior auth list. And similarly, for individual physicians who are prescribing, the health plans have the data on who the outliers are.

The vast majority of us are practicing evidence-based medicine, fighting these bad prior auth battles on behalf of our patients, explaining why the treatments we’re prescribing are appropriate and ultimately getting the overwhelming majority of our prescriptions approved after a whole lot of extra administrative burden and cost. They ought to take those of us who ultimately get most of our things approved and “gold card” us, which is when for some period of time the level of scrutiny on you goes down.

Sure, they can watch the data, and if something dramatic changes, they can come back and change somebody’s status. We got some early agreement from health plans’ leadership, who signed a consensus statement and said that they would work with us on this, but we just haven’t seen movement.

The average physician tells us they’re doing 31 prior auths every week and, as of a year ago, are spending about 15 hours of their time and their staff’s time doing them.

It’s incredibly frustrating, because most of the time the person at the other end of the phone that you’re having this conversation with is typically not a physician. And they are almost always not the same type of specialty physician. Oftentime, they’ve not heard of the disease you’re treating, so they’re just typing it into a computer and seeing what comes up on their screen.

You’re spending time that you could be spending with other patients. Instead, you are trying to educate them about why this is actually the standard treatment for this disease and isn’t even an unusual request.

ME: So all this time that’s going to prior authorizations could be time spent with patients, or even with your own family to reduce the growing burnout problem.

Resneck: That’s right. When we study burnout, the data show that the things that cause burnout are the things that get in the way of why you went into medicine in the first place, such as being able to provide the kind of care you want to provide to your patients. Prior auths have really risen for many people to the top of that list. When I used to travel around the country talking to physicians, poorly designed EHRs were at the top of that list, but prior auths have really exceeded that in terms of what I now hear. It is incredibly frustrating not to be able to get your patients on the therapies that they need to get better.

The other thing is: it’s not just a burnout issue. We have tremendous administrative costs in our health care system in this country. When you think about the amount of time that every practice is having to spend doing this and the amount of time that health plans are spending on the other end processing our requests and our appeals, it seems to me there’s a tremendous amount of waste here.

ME: Is there anything an individual doctor can do to change the prior authorization process?

Resneck: We have a number of efforts in legislatures and with regulatory bodies in Washington and around the country to put some guardrails around this system again, not to get rid of it, but to make it function more closely aligned with its original purpose.

So, for example, in Congress right now, we have HR3107, which asks for some transparency, among other things, around prior authorization requirements. We’ve been working with the administration on trying to reduce the burden around Medicare Advantage and Medicare Part D plans, over which they have authority, and change some of the rules about how health plans do prior auths. And then a number of state legislatures around the country are taking this up; Kentucky passed a very good bill last year, for example. So I think it’s important that frontline physicians reach out to their members of Congress, to their state legislators and talk to their state medical society about what bills are coming up in their own states to help make sure that lawmakers and policy makers understand. That was part of the purpose of my piece, continuing this conversation, so that people understand just how frustrating this is, especially for our patients.

ME: You mentioned Kentucky passed a good bill, so do you see more positive change on the horizon?

Resneck: We’ve got a long way to go. But I am feeling more optimistic because as I talk to lawmakers and policy makers about this, they are increasingly understanding that this has gotten out of control. When I’m talking to them, almost every one of them has personally experienced or had a family member experience the ridiculousness of being stuck in this maze. So I am optimistic. It’s going to be a journey and take us a while to get this change done, but we are going to keep working incredibly aggressively. This is too important to let it go on as it is.

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