what is a prior authorization

Prior authorization is a process used by some health insurance companies in the United States to determine if they will cover a prescribed procedure, service, or medication. It is a utilization management process that checks if certain prescribed medications or medical procedures are covered by the insurance provider before they are delivered to the patient. Prior authorization is used for a number of reasons, including age, medical necessity, the availability of a generic alternative, or checking for drug interactions. The process to obtain prior authorization varies from insurer to insurer but typically involves the completion and faxing of a prior authorization form. The purpose of prior authorization checks is to provide cost savings to consumers by preventing unnecessary procedures as well as the prescribing of expensive brand name drugs when an appropriate generic is available. However, prior authorization can delay important care that patients need and can be a burden on physicians and their staff. The AMA believes that the overall volume of medical services and drugs requiring prior authorization should be greatly reduced.