Sorry for the long absence from the blog site. The previous posts have explained various aspects of my practice or provided what may be referred to as helpful hints for mental health. I now plan to move to a more wide ranging group of topics. Today's topic concerns the rise in prior authorization requests.
Psychiatry has been particularly hard hit by medication prior authorization requests. This topic has been widely discussed in professional circles but perhaps not so often between physicians and patients. As the immediate past president of the Mississippi Psychiatric Association, a former member of the American Psychiatric Association Assembly (the legislative body of the APA) and an active member of the Mississippi Medical Association, I have debated and advocated for prior authorization reform. We were able to get a uniform prior authorization request for the various Medicaid programs, but have been less successful with the various commercial insurance companies. The most likely reason for this is that prior authorization ( hereafter referred to as pa) do not come from your insurance company directly but from a pharmacy benefits management company (pbm).
Nationally, pa requirements have become a major topic of concern. How big is the issue? Last year the Cleveland Clinic spent about 10 million dollars on prior authorization requests. An AMA survey of 1,000 practicing physicians found that on average medical practices spend two business days per week per physician to comply with pa protocols. One third of practices employ staffers who do nothing all day but process pa requests. On average, a practice will complete 29.1 pa requests per physician per week that requires 14.6 hours to process. About half of the requests are for medical services while the other half is for prescriptions.
Pa request originate with the pbm. Pbms make their profit by billing the insurance company, receiving rebates from the pharmaceutical manufacturers, and discounts from the pharmacies. The goal for the insurance company is to pay the pbm as little as possible, the goal of the pbm is to make as much profit as possible. Pbms can increase profit by: 1. obtaining greater rebates from the manufacturer, 2. paying the pharmacy less for the medication, 3. receiving payment from the insurance company for medication coverage and limit the patient's utilization of the medication and therefore pocket the difference as profit. Number 3 is where the prior authorization comes in to play. By excessive, onerous and burdensome prior authorization requests the pbm drives down medication utilization.
In the past, the pbms largely focused on expensive medication services delivered in hospital outpatient services, infusion centers and chemotherapy delivered in physicians clinics. These have generally been chemotherapy agents for cancer or rheumatologic diseases. In both of these areas the pa is requested from the party that is delivering the service and being paid for the service.
In the case of a pa request from a pharmacy, the physician is being asked to devote additional time and effort to obtaining a service (dispensing a medication) for which the physician is not compensated, but the pharmacy and pbm are being compensated. The fee that the patient and the patient's insurance company pays to the physician at the time the clinical service is delivered at the office covers only the face to face time, effort, and clinical decision making at the time of the consultation (coding guidelines and CMS guidelines). In the past, the pbm companies targeted only new medication that were many times more expensive than existing medication. Over the past year there has been a move to require prior authorization for generic and relatively inexpensive medication. We have received pa requests for Benadryl, Cogentin (on the market since the 1960's), Elavil (on the market since the 1950's) and other similar medication.
We often hear from patients something along the lines of "the pharmacy said you just have to authorize the medication". If it were that simple. Completing a pa usually consists of either logging onto the pbm website or filling out a pa form. The pa usually requires such things as a diagnosis, length of treatment, other medications that have been utilized to treat the condition, including doses and dates, reasons for not continuing these medications, and the reason the requested medication is the only one that will treat the condition (and then only if FDA indicated and not "off label"). In addition, a pbm may require that you be prescribed and fail to respond to two other medications before the requested medication will be allowed. As you can see, this is not a simple request but requires going through your entire medical record. Because there is clinical reasoning involved it can only be completed at the highest level by the physician. The medication is then almost routinely denied. The most common denied medications in my practice are second generation antipsychotics, controlled release stimulants, and newer antidepressants.
While I and my staff are always wiling to advocate for the best possible care for my patients, advocacy is not without cost. Insurance companies do not reimburse the physician or physician staff for the time, effort, and clinical judgement involved in completing a pa. The insurance company pays only for direct face to face medical care delivered at the time of the clinic visit. Therefore, if you wish the office to complete an pa and advocate with your pbm on your behalf you will be charged for the service.
Philosophically, I am a capitalist and do not begrudge companies realizing the profits they can generate. I also have to deal with my own personal physician and pharmacy benefits and purchase insurance coverage for my family and employees. In my roles above I have advocated for my fellow physicians and our patients with insurance executives and government officials. I believe that transparency and sunlight are essential for good working agreements, such as those between you, me, your insurance company, pharmacy and pbm (my guess is you didn't know there were so many people involved in our transaction). I hope this post has gone some small distance in making the pharmacy benefits coverage provided by your insurance company a little more transparent and enlightened.