Retro Authorization: Medical billing companies strive to assist doctors in minimizing claim rejections and enhancing patient satisfaction through effective methods like insurance verification and preauthorization services. Prior authorization is used by health plans to decide if a prescribed treatment or service will be reimbursed.
Insurance verification experts aid healthcare providers in managing this lengthy and cumbersome procedure by confirming patient coverage prior to providing a service and obtaining approval from the health plan. This ensures patients receive prompt access to necessary care.
Retro authorization Approval
Getting approval for a patient’s services before providing them is known as prior or pre-authorization. Many insurance companies require this authorization either before or within 14 days of the services being rendered.
But what if the provider couldn’t obtain pre-authorization beforehand?
In rare cases, like emergencies, where preauthorization isn’t possible, they might need to seek retroactive authorization. This means requesting approval from the insurance company after the patient has been treated and the specified time has passed.
Retroactive authorizations are granted when the patient is unable to provide necessary medical information upfront, such as being unconscious. They may also be used when the healthcare provider didn’t have time to get prior authorization or if a claim is denied due to medical necessity.
Each insurance provider has its own rules regarding when retro-authorization requests must be submitted. For example, Beacon Health Options requires written requests within 45 days of the service date. Once the provider sends the retro authorization request, the payer will reimburse based on their guidelines.
However, there are concerns with retroactive authorizations:
- There’s no guarantee that the payer will approve retro authorization if preauthorization was missed.
Even if a denial is overturned on appeal, payer rules on retro-authorization may change, and they’re not obligated to pay if their guidelines weren’t followed. - Insurance verification and authorization companies keep abreast of these changes to assist practices in managing retro-authorization requests efficiently.
Valid Circumstances
To request retro-authorization, use standard channels like phone, fax, or the payer portal. Make it clear in your submission that you’re seeking retro-authorization.
Retroactive authorizations undergo a review to ensure the care was necessary and provided efficiently. When requesting retro-authorization:
Document the valid reasons for the retro request. Routine services usually aren’t retro-authorized without valid documentation.
Examples of valid circumstances include:
- Services initially authorized by another payer, but later found ineligible
- Member retroactively deemed eligible by Medicaid
- Services during a transition between Managed Care Organizations
- Member unable to provide insurance information due to incapacity
- Ensure correct coding of care according to CPT and ICD-10 guidelines on the submitted bill.
Adhere to the payer’s timely filing guidelines for retro-authorization-related claims.
Note: A retro-authorization request doesn’t guarantee approval. Denied requests can be appealed.
How Retro Authorization Affects Your Revenue Cycle Management
Implementing retro authorization can greatly affect how you manage your revenue cycle. Not having retro authorizations in place can lead to negative effects on your financial results, such as:
- Delayed Reimbursement
- Rising administrative expenses
- Decreased Cash Flow
Delayed Reimbursement
If a service isn’t authorized properly when it’s provided, and if a retro authorization request isn’t submitted or approved, you might not get paid for that service. This can lead to delayed reimbursement and harm your revenue management process.
Rising administrative expenses
The retro authorization process can be both time-consuming and intricate. It involves thorough examination of medical records, insurance policies, and other documents, as well as ongoing communication with insurance companies and patients. These supplementary administrative duties can elevate the expenses associated with your revenue cycle management.
Decreased Cash Flow
When reimbursement is delayed and administrative costs rise, it can lead to a decrease in cash flow for your practice. This can create difficulties in paying bills, investing in new equipment or technology, and expanding your practice.
Outsource Insurance Verification and Authorization
Dealing with the complexities of prior authorization and retro authorization can become much simpler with the assistance of an insurance verification company. Skilled specialists from these companies contact insurance providers to secure authorizations promptly and efficiently. They confirm whether a specific medical procedure is covered and secure prior approval from the payer to ensure prompt and accurate reimbursement.
Top insurance authorization firms possess extensive knowledge of both government and private insurance regulations, ensuring that claim submissions contain accurate information. Their goal is to streamline the prior authorization process, obtain swift approvals, and minimize the risk of errors and delays. By entrusting these challenging and time-consuming tasks to experts, healthcare providers can concentrate on delivering quality patient care.
