Last Updated: Aug 22, 2018
The Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma recently announced the goal of eliminating the fax machine in provider offices by 2020. She shared this news during the Office of the National Coordinator for Health IT (ONC) 2nd Interoperability Forum held in Washington, D.C. on Aug. 6-8, 2018.
Although this announcement seems alarming, this could be one of the steps needed to streamline the prior authorization process.
Studies Show Costs for Manual Prior Authorizations Are Higher than for Electronic
Recent studies by Council for Affordable Quality Healthcare (CAQH) indicate that 90 percent of communications between a provider and payer continue to be completed by phone or fax.
The CAQH Index assesses industry progress to reduce the use of manual transactions and eliminate cost. According to the 2017 CAQH Index 35 percent of prior authorization is fully manual (e.g. Telephone, Fax, Email), 57 percent is partially electronic (web portal or IVR), and 8 percent is fully electronic (ASC X12 278). A provider cost for a fully manual prior authorization transaction is $5.75, and for an electronic transaction is $2.55. That is a cost savings of $3.20 per transaction per provider.
Streamline Prior Authorization for Electronic Transactions, Says PAMED Physician
In May 2018, the Pennsylvania Medical Society (PAMED) was asked to provide testimony during a CIO Forum before the National Committee on Vital and Health Statistics (NCVHS) Subcommittee on Standards. The purpose of the Forum was to discuss the updates to HIPAA administrative standards and operating rules.
Prior authorization – one of PAMED’s advocacy priority issues – was the focus of testimony shared by PAMED member and Past President James Goodyear, MD, FACS during the Forum.
To reduce paperwork and streamline provider billing and administrative functions, CMS and HIPAA established standards for electronic transactions. These standards and operating rules include electronic transactions such as claims and claim status, electronic remittance and payment advice, eligibility, prior authorization, referrals, coordination of benefits, and claims attachments. Although most of the standards have been adopted, they have not been updated since 2009.
Dr. Goodyear shared this testimony:
Authorization requests are where our practice and physician practices on a national level would like to see more innovation. This is an issue of high priority for both PAMED and the American Medical Association (AMA). We need to see a more efficient approach for prior authorization of procedural care. In an age where we can attach consolidated clinical document architecture (C-CDA) to a direct secure message for a referral to another provider, how can we integrate this with our payers? Large and small physician groups hire additional staff to work on prior authorizations, and most requests continue to be fulfilled via fax, telephone, and even mail. I understand electronic prior authorization can be initiated by an electronic request or through a provider portal – for example, Navinet – but most follow up occurs by telephone or fax. This is an administrative burden and we ask that payers be held to the same standard as providers. The workload is unsustainable and interrupts patient care. Processes need to be streamlined and accountability shared equally between the two entities.
The prior authorization transaction, otherwise known as Accredited Standards Committee (ASC) X12 278 is mandated in the HIPAA Transaction and Code Set rule, but it is slow to be adopted. Eliminating the fax machine, may be considered a step in the right direction to bring all parties together to follow the same set of standards with regard to prior authorization.
No Fax Friday on Oct. 12, 2018
In an effort to reduce the use of the fax machine, ONC’s Steve Posnack encouraged organizations to participate in “No Fax Friday” on October 12, 2018. Eliminating the fax is one of the ways providers leverage the EHR using the HIPAA 278 transaction exchanging necessary information initiating a prior authorization quickly and efficiently.
PAMED encouraged practices to take the ONC's challenge and then complete our brief survey to strengthen our advocacy efforts in Washington D.C.
More information regarding the 2017 CAQH Index Report can be found at: https://www.caqh.org/sites/default/files/explorations/index/report/2017-caqh-index-report.pdf
Dr. Goodyear’s complete written testimony can be found here.
To learn more about PAMED’s current advocacy priorities, including prior authorization, visit www.pamedsoc.org/advocacy.