What to Do If Prior Authorization Is Denied

Prior authorization is a process where health insurance plans require approval before covering certain medical services, medications, or procedures. This step helps insurers determine medical necessity and policy compliance. However, a prior authorization denial can cause frustration and delay care. This article outlines steps to navigate a prior authorization denial, from understanding the insurer’s decision to exploring alternative solutions.

Understanding the Denial Decision

After a prior authorization denial, thoroughly review the denial letter from the insurance company. The letter details denial reasons: lack of medical necessity, experimental treatment, incomplete information, or out-of-network provider. It also contains appeal process information, including instructions and deadlines.

Keep meticulous records of communications with insurers and providers: dates, times, representatives’ names, and discussion summaries. Maintain copies of all submitted documents—initial prior authorization request, medical records, and the denial letter. This approach helps throughout the appeals process.

Understanding the denial reason guides the next steps. If the denial cites incomplete information, coordinate with the healthcare provider to resubmit the request. If based on medical necessity, gather additional clinical evidence for an appeal.

Navigating the Internal Appeal

Once the denial reason is clear, initiate an internal appeal directly with the insurance company. This requires a well-prepared submission to advocate for the denied service. Comprehensive supporting documentation strengthens the appeal, including updated medical records, detailed physician notes, and relevant diagnostic test results.

A letter of medical necessity from the treating physician is a key component, explaining why the requested service is appropriate and medically necessary for the patient’s condition. Physicians can also include peer-reviewed literature or clinical guidelines supporting the treatment’s efficacy and necessity. This package addresses the insurer’s concerns and provides a clinical rationale for reconsideration.

The appeal letter should state the patient’s information, claim or prior authorization reference number, and the denied service. It should directly address the insurer’s reason for denial, explaining why the initial decision should be reversed based on provided evidence. The letter should maintain a professional, factual tone, focusing on medical justification.

Internal appeals must be submitted within a specific timeframe from the denial notice date. Submitting the appeal can be done via mail, fax, or the insurer’s online portal, as specified in the denial letter or plan documents. Insurance companies must respond within 30 days for services not yet received, and within 60 days for services already rendered. For urgent medical situations, an expedited appeal can be requested, requiring a decision within 72 hours.

Pursuing External Review

If the internal appeal is unsuccessful, pursue an external review. This process involves an independent third party, not affiliated with the insurer, reviewing the denial decision. External review is available when the denial is based on medical necessity, experimental treatment, or other clinical reasons.

Eligibility for an external review depends on state laws and requires the internal appeal process to be exhausted or an urgent medical need. To determine eligibility and requirements, contact your state’s Department of Insurance or equivalent regulatory body. This body oversees the external review process and provides forms and guidance.

Documentation for an external review includes the final adverse determination letter from the insurer, confirming the internal appeal denial. Other relevant medical records and supporting information from the internal appeal submission should also be included. Ensure all documentation is complete and accurately reflects the medical necessity of the denied service.

Initiate an external review by submitting a written request within four months after receiving the final internal appeal denial. Send this request to the state’s Department of Insurance or a designated independent review organization (IRO). Once received, an IRO is assigned to conduct the review. The IRO’s decision is issued within 45 days for standard review, or 72 hours for expedited cases. The external reviewer’s decision is binding on the insurance company.

Considering Alternatives

When appeal avenues are exhausted or not feasible, explore alternative options for care and coverage. Discuss different treatment options with the physician. Alternative medications, procedures, or treatment plans might be covered by existing insurance or be more affordable. Open communication with the healthcare provider about financial constraints can lead to viable alternatives.

Financial assistance programs support medical expenses. Many pharmaceutical companies offer patient assistance programs for specific medications, providing reduced costs or free drugs to eligible individuals. Non-profit organizations also offer grants and financial aid for patients, helping with copays, deductibles, or travel expenses. Hospitals and healthcare systems often have charity care programs or financial assistance policies, offering discounts or free care based on income and hardship.

For individuals without insurance or facing high out-of-pocket costs, negotiating self-pay rates with providers is common. Many healthcare providers offer discounts for services paid in cash or upfront. Inquire about the “cash price” before receiving services and get agreed-upon rates in writing. Establishing a payment plan with the provider can make large medical bills more manageable.