Know Your Payer Requirements.
When it comes to preauthorization, it is important to know what your payers require. Some prior authorization programs may require test registration and/or genetic counseling and may limit or discontinue retro-authorization options. The latest payers to adopt such programs are Anthem Blue Cross and UnitedHealthcare.
Define Your Lab’s Financial Goals.
Before you can determine the best strategy for managing pre-test authorization, you need to define your lab’s financial goals and establish your lab’s identity, including the willingness to trade reimbursement for market share and volume. Start by analyzing your historic revenue data. Analytics will help you understand and anticipate what the new pre-test requirements will cost your lab. A good revenue cycle system can help you identify which of your tests, patient populations, providers, and payers perform best financially and which do not. Investigate under-performing product-market segments. Is it a volume issue, a cost issue, or both? Are the right tests being ordered and performed? Engage in a low-cost, high-impact educational campaign targeting providers and patients as well as your own sales team and back-office support.
To Test or Not To Test – Things to Consider.
When you are sure the right tests are being properly ordered, you need to decide whether or not your lab should perform the tests. Delivering rapid turnaround in the midst of rigorous payer pre-test requirements adds complexity and cost to your lab’s operations. What level of calculated risk to reimbursement is your lab willing to accept in order to maintain market share and deliver rapid turnaround? Here are some things to consider during your decision-making process.
With certain exceptions, Medicare defines Date of Service (DOS) as the date the specimen is collected, making it virtually impossible for the laboratory to obtain prior authorization after the specimen has been received. Some commercial and Medicare Advantage plans may allow the DOS to be the date the test report is signed. It is in the lab’s best interest to have all pre-test requirements before starting the test. Pre-test requirements include not only payer prior authorization, but also basic coverage determination. In the event the test is not a covered benefit, the payer may require patient consent through the use of an Advance Beneficiary Notice (ABN) form in order to bill for the test. How will the need for prior authorization and ABN impact your accession process? Consider deploying a client-facing ordering portal that will include the payer pre-test requirements so that the ordering physician has the necessary information at the time of ordering.
Another strategy is to revisit your payer contracts. If during payer negotiations your lab cannot eliminate a payer’s requirement for prior authorization, then you may want to attempt to negotiate the terms. Some labs have been successful in negotiating a 2-week window from specimen collection in which to secure pre-test requirements. If granted, it would be the lab’s decision whether or not to go to testing during this time, tailoring accession operations based on product-market segment performance. Specimens from high-performing segments would move to testing immediately, while specimens from other segments could be held until all pre-testing requirements are met.
Consider the demands of proper specimen handling. Many biological specimens (blood, urine, bone marrow) do not have long viability. Define your lab’s specimen handling requirements to ensure the integrity of your test results. Identify these procedures and protocols in your negotiations with payers stating the adverse effects of testing delays. Plan for these operations in your accession workflow strategies.
Choose Your Next Move.
The choices you make for how your lab moves forward in the midst of today’s rigorous pre-testing requirements depends on your lab’s ability to optimize its revenue cycle while delivering quality test results. Achieve operational success and maximize reimbursement efforts by understanding the payer’s requirements and then deploying an optimized, prioritized workflow.