Pre-Authorization Rate is a key metric in healthcare revenue cycle management that measures the percentage of pre-authorization requests that are approved by insurance companies. Pre-authorization is the process of obtaining approval from an insurance company before providing a healthcare service or treatment to a patient. This is done to ensure that the service or treatment is covered by the patient's insurance plan and to avoid any potential denials or delays in payment.A high pre-authorization rate indicates that the healthcare organization is effectively communicating with insurance companies and obtaining the necessary approvals before providing services to patients. This can help to reduce the risk of denied claims and improve the overall revenue cycle management process.
On the other hand, a low pre-authorization rate may indicate that the healthcare organization is not effectively communicating with insurance companies or is not following the proper pre-authorization procedures. This can lead to denied claims, delayed payments, and increased administrative costs.
Overall, tracking pre-authorization rate is an important metric for healthcare organizations to monitor in order to ensure that they are effectively managing their revenue cycle and maximizing their revenue potential.
Pre-Authorization Rate is calculated by dividing the number of pre-authorization requests submitted by the total number of services or procedures performed during a specific period of time. The resulting percentage represents the rate at which pre-authorization was obtained prior to providing healthcare services to patients. This metric is important in healthcare revenue cycle management as it helps to ensure that services are authorized and reimbursed by insurance companies, reducing the risk of denied claims and revenue loss.
Best practices to improve Pre-Authorization Rate are:
1. Educate staff: It is essential to educate staff on the importance of pre-authorization and the impact it has on the revenue cycle. Staff should be trained on the pre-authorization process, including the necessary documentation and the importance of obtaining pre-authorization before services are rendered.
2. Verify insurance coverage: Before scheduling any services, it is important to verify insurance coverage and determine if pre-authorization is required. This can be done by contacting the insurance company or using an automated eligibility verification system.
3. Utilize technology: Technology can be used to streamline the pre-authorization process. Automated pre-authorization systems can help reduce errors and improve efficiency. These systems can also provide real-time updates on the status of pre-authorizations.
4. Develop a pre-authorization policy: A pre-authorization policy should be developed and communicated to all staff. The policy should outline the pre-authorization process, including the necessary documentation and timelines for obtaining pre-authorization.
5. Monitor and track pre-authorization rates: It is important to monitor and track pre-authorization rates to identify areas for improvement. Reports should be generated regularly to track pre-authorization rates and identify any trends or issues.
6. Follow up on denials: Denials should be followed up on promptly to determine the reason for the denial and to take corrective action. This can include appealing the denial or working with the insurance company to resolve any issues.By implementing these best practices, healthcare organizations can improve their pre-authorization rates, reduce denials, and improve their revenue cycle management.
The industry standard benchmark for Pre-Authorization Rate is typically set at 90%. This means that healthcare providers should aim to have 90% of their pre-authorization requests approved by payers. A Pre-Authorization Rate below 90% indicates that there may be issues with the provider's pre-authorization process, such as incomplete or inaccurate information being submitted to payers, or a lack of communication between the provider and payer.
A low Pre-Authorization Rate can have a significant impact on a healthcare provider's revenue cycle, as denied pre-authorization requests can result in delayed or denied payments for services rendered.
Revenue cycle software can significantly improve the Pre-Authorization Rate metric by automating the pre-authorization process. With the help of revenue cycle software, healthcare providers can easily verify patient insurance coverage and eligibility, check for pre-authorization requirements, and submit pre-authorization requests electronically. This automation reduces the chances of errors and delays in the pre-authorization process, resulting in a higher pre-authorization rate.
MD Clarity's revenue cycle software is designed to streamline the pre-authorization process and improve the Pre-Authorization Rate metric. Our software automates the pre-authorization process, allowing healthcare providers to quickly and accurately verify patient insurance coverage and eligibility, check for pre-authorization requirements, and submit pre-authorization requests electronically. With MD Clarity's revenue cycle software, healthcare providers can significantly improve their Pre-Authorization Rate metric, resulting in increased revenue and improved patient satisfaction.
If you're interested in seeing firsthand how MD Clarity's revenue cycle software can improve your Pre-Authorization Rate metric, we invite you to book a demo with us today. Our team of experts will walk you through our software and show you how it can help you streamline your revenue cycle management processes and improve your bottom line. Contact us today to book your demo!