Insurance companies that do not currently take advantage of the benefits of pre-authorization are missing out on several significant advantages. Implementing pre-authorization processes on every single automobile no-fault claim has the potential to improve your overall retention rates as well as save your company significant dollars, both of which add up to help the bottom line.
Perhaps the clearest impact of pre-authorization can be seen within the topic of injury relatedness. In the case of insurance companies that aren’t applying pre-authorization to their claims, those companies are paying for unrelated physician prescribed services for their claimants in a number of claims. Generally, this payment of non-injury-related services occurs within claims where a claimant is already taking a prescription medication prior to being injured in an automobile accident. The dosage of the medication may be increased after the claim and the insurance company ends up paying for the entire prescription medicine rather than just the increase in dosage. Without pre-authorizing all physician prescribed services, it is highly likely that the insurance company will end up paying for the entire prescription unnecessarily which negatively impacts the bottom line.
Pre-authorization also allows for the most convenient claimant experience. Once a physician has prescribed a medication for your claimant and your company has implemented pre-authorization, your claimant will not pay out of pocket for his or her medication. They are simply able to pick up the prescribed medicine with no need to navigate through payments or the traditional reimbursement process. Naturally, this translates to a more satisfied claimant which helps sway their decision to keep their policies with your company when it comes time to renew.
Implementing pre-authorization for your automobile no-faults claims will provide benefits behind the scenes as well. The Healthcare Common Procedure Codes (HCPCS) system is a complex system and is often the source of inadvertent errors due to incorrect code usage. Having pre-authorization in place means that the correct HCPCS codes will be used on all physician prescribed services. The use of not otherwise classified (NOC) codes should also be eliminated through this process. Both of these changes combine to help reduce errors and ensure that your company is paying the appropriate amounts for physician prescribed services.
Northwood is an industry-leading third-party administrator (TPA) of automobile no-fault claims and a firm believer in implementing the pre-authorization process for all claims. It is critical that your company takes care of its claimants and Northwood has the experience to help delight your claimants, improve retention rates and help improve your bottom line.