Prospective Prior Authorization Study
Prior authorizations (PA) of tests, medications and other clinical services have become a time-consuming and uncompensated requirement for primary care practices in recent years. Through Life Laboratory’s “living laboratory” model, a PA study was conducted to determine how much time primary care practices actually spend on PA activities. Life Laboratory collaborated with researchers at SUNY Upstate Medical University, Syracuse, NY, who also performed a prospective PA study.
During the studies, the physicians and office staff from 12 primary care offices in northeastern United States recorded request type, reporter role and time spent for each PA event at the time of the PA activity. Resource consumption time was tabulated as well as costs, which were based on salary data from the U.S. Bureau of Labor Statistics and from Salary.com.
The mean annual projected cost per full-time equivalent physician for PA activities ranged from $2,161 to $3,430 in the two studies. Using self-reporting at the time of the event, Life Laboratory found that preauthorization is a measurable burden on physician and staff time, while not improving healthcare quality and value.
As a result of these two studies, we concluded that further studies that include cost-benefit analyses, estimates of opportunity costs and costs of delayed testing and treatment, as well as the substantial “hassle factor” for patients and physicians are warranted.