The healthcare payment lifecycle for laboratories begins with prior authorization (PA). Providers rely on laboratories to provide them with accurate and vital information often critical to determining a course of treatment for their patients. To further complicate things operationally, tests must be performed promptly, and results returned to the ordering physicians as quickly as possible.

The ongoing payment lifecycle problem for laboratories is how to effectively determine which tests are going to need prior authorization and which ones can be performed immediately. There is often limited time to carefully assess whether a prior authorization is required and thus avoid a lengthy denial process.

Automation in the Laboratory Revenue Cycle

Receiving insurance payer approval for prior authorization after performing a lab test has become less likely, with most payers rejecting those requests outright and again during the appeals process. This places a significant burden on the providing laboratories–do you perform the test swiftly and risk rejection by the insurance payer or do you process, often manually, the prior authorization and run the risk of negatively impacting patient care or jeopardizing referring provider relationships?

One solution that would increase efficiency for the lab as well as for ordering providers are automating alerts in the computerized physician order entry (CPOE) system, electronic health records (EHR) system, or scheduling system. By integrating PA requirements on a test-by-test basis, provider clinical staff and laboratory staff would both be alerted to potential issues as soon as the tests were ordered so that approvals could be initiated and denials from insurance payers avoided.

Improving the Prior Authorization Process

As automation and the use of Artificial Intelligence (AI) and machine learning advance, integrating multiple clinical, archival, and financial electronic systems into one comprehensive solution are possible. With a strong PA component, automated alerts would activate the process of submitting PA information to the insurance payer, monitoring results, and providing follow-ups electronically.

The number of insurance payers and their individualized PA programs, with various rules and guidelines, creates a complex and often frustrating course to navigate. This impacts denial and rejection rates and laboratory bottom lines. The benefits recognized by AI, predictive analysis, and machine learning-based automation include real-time absorption of insurance payer changes and updates, as well as the ability to shift existing PAs being processed to meet those updates.

For the future, laboratories need to be armed with innovative and scalable payment lifecycle solutions that combine intelligent, cloud-based platforms supported by highly-trained specialists that address outliers and exceptions. With a comprehensive alert system incorporated in CPOE and EHR, this system would be seamless and complementary to your customer base–referring providers.

Contact us to schedule a demo to reduce denials in your lab revenue cycle.