If you are going in for medical treatment, surgery or diagnostic testing, it is important for you as the consumer to know about your health insurance policy’s requirements for a preauthorization. There are steps that you can follow to see whether a preauthorization is needed for your health insurance.
Network vs. Out of Network
Before receiving treatment, find out if the hospital or other medical facility that you will be seeking treatment is in network. You can find this out by calling the facility and asking if they are in network with your insurance company. Some insurance companies do not require preauthorizations for anything in network, while out-of-network care will not only be more expensive, but may also require a longer waiting period before you can receive services.
Outpatient Service Preauthorizations
Next, you may want to call your insurance company to see if a preauthorization is needed. Some insurance companies will not provide a confirmation to the patient because a patient may not have the codes necessary to look up a specific procedure. When speaking with someone from your insurance company, be sure to ask for their first name and last initial so that you can keep records of who you spoke with and note the time and date. If there is a problem with your claim later due to a preauthorization, this may help your case.
Most medical facilities will work with doctor’s offices to attain a preauthorization from the insurance company before you have a procedure. This is done because the hospital may not know your specific diagnosis, so the hospitals collaborate with one another to make sure that you have a preauthorization before you go in for your appointment. If a preauthorization is not received before your appointment, the hospital will most likely be responsible for the bill if it was their mistake. A hospital or facility should advise you if an authorization was not received. You do have the right to continue with receiving tests or treatment; however, in this case, you will be responsible for the bill if an authorization was necessary. Most hospitals will have you sign a waiver declaring that you will be responsible for the bill if the claim is denied by the insurance company.
If you have a federal insurance plan through a federal government agency, you normally do not need a preauthorization for outpatient services.
Preauthorization for Inpatient Services
Most insurance companies require that the hospital facility contact them within 24 to 48 business hours of hospital admission and require notification of observation stays. You may want to contact your insurance company to notify them of a hospital admission to ensure that the process has been started and that they are aware of the admission.
An insurance company may give you the approval or authorization number or even a reference number for the call, while others may refuse to give this to you. Insurance companies will often put a hospital admission under a case or utilization management review, where they attain medical records from the hospital’s case manager or UR department to ensure that the hospital stay was medically necessary. Many insurance companies will not give out any authorization number until this process is complete. You may call back after the utilization review is finished to receive an authorization number.
You should receive a letter in the mail from your insurance company within a few weeks of discharge stating whether the stay was approved and if additional information is needed. Such a letter is also sent to the hospital and physician that provided care for you during your hospitalization.
Getting a preauthorization does not mean that an insurance company will cover an entire bill. Be familiar with what your insurance co-pays and deductible amounts are before you seek medical treatment. This will help to alleviate some of the financial hardship that medical costs can often cause.