The U.S. healthcare system is grappling with a surge in claim denials and prior authorization requirements, creating significant challenges for both providers and patients. To shed light on this pressing issue, we spoke with Oron Afek, CEO of Vim, a company that assists over 20,000 providers and 80% of the largest U.S. payers with prior authorizations.
In this interview, Oron Afek provides valuable insights into the challenges and potential solutions related to claim denials and prior authorizations. He emphasizes the importance of collaboration between providers and payers, the adoption of automation and AI, and the need for ongoing education and training. His insights offer practical guidance for healthcare providers seeking to improve efficiency, reduce administrative burden, and enhance patient care.
How significant is the problem of rising claim denials and prior authorization requirements in the U.S. healthcare system?
Oron Afek, CEO of Vim: The escalating rate of claim denials and prior authorization demands is a serious barrier to healthcare access and affordability. Prior authorization challenges, such as unclear requirements, result in denials impacting patient care. For example, when a prior authorization is not approved, patients may forgo treatment since they cannot afford essential treatments outside of insurance coverage. Additionally, given the high rate of denied or delayed claims, particularly for high-cost services, patients and providers bear the financial and logistical burdens of navigating these complexities.
As patients defer treatment due to these systemic bottlenecks, public health worsens, impacting communities across socioeconomic lines. This dynamic leads to poorer long-term health outcomes and rising chronic conditions.
As issues compound, providers are met with overcoming administrative challenges such as navigating payer-specific rulesets and documentation requirements that are often unclear. These administrative hurdles translate to time-consuming processes that drain resources and diminish the focus on patient care.
What are the key factors contributing to this rising trend?
Oron Afek: Several primary drivers fuel this trend:
- Interoperability Issues: Fragmented systems—particularly among electronic health records (EHRs), payer databases, and other health tech solutions—create data gaps, resulting in incomplete submissions or outdated policy adherence.
- Complex Payer Rules: Constantly shifting policies among insurers require ongoing adaptation, making it difficult for providers to keep pace.
- Pharmacy Benefit Managers (PBMs): PBMs influence drug pricing and access, with frequent shifts in coverage tiers and prior authorization requirements impacting care continuity.
- Frequent Contract and Formulary Changes: Constant updates in payer-provider contracts and drug formularies create confusion, leading to denials based on updated criteria that are not universally communicated.
- Inefficient Workflows: Payer and prior authorization submission portals and other processes that disrupt providers’ workflows require separate logins and additional screen time. Overall, this contributes to a significant administrative burden.
How can healthcare providers relieve the administrative burden associated with claim denials and prior authorizations, especially given the current staffing shortages?
Oron Afek: Healthcare providers can’t tackle these challenges in a silo. They must challenge payers to support and sponsor technology and AI-backed automation that fits within their day-to-day workflows—no more separate out-of-workflow portals or manual submissions.
In creating a transparent conversation between payers and providers, solutions will emerge:
- Adopting Automation: Automating prior authorization submissions and claim status checks within existing systems of record, such as EHRs, reduces manual processing time. AI can instantly populate necessary data from EHRs, checking for errors before submission.
- Streamlining EHR Integration: Integrating EHRs with payer requirements through novel mechanisms such as overlays and notifications allows seamless transmission of medical necessity data, minimizing discrepancies that trigger denials.
- Collaborative Solutions: Providers can work closely with payers to standardize prior authorization protocols and revise policies. For example, focusing prior auth only on high-cost or high-risk treatments would reduce the number of services requiring prior authorization. This cooperation can streamline approval processes, further alleviating administrative loads.
Given the strain from staffing shortages, these technology-driven efficiencies enable healthcare professionals to redirect time and energy to direct patient care rather than on extensive documentation and administrative tasks.
What role can AI and automation play in streamlining these processes and freeing up clinicians’ time for patient care?
Oron Afek: AI and automation are critical components for digitizing prior authorization approval processes and driving novel solutions and programs at the point of care. One example is an AI-backed solution for automating “gold carding” or other payer-led initiatives to mitigate prior authorization burden. In this example, the solution could leverage machine learning algorithms to streamline the review and approval process for recurring medical services and identify clinics that consistently meet high-quality standards.
An AI system could offer:
- Data Analysis: Continuously analyze claims history, clinical notes, and outcomes to assess whether providers meet a pre-set standard for gold carding. Scores can be assigned to clinics based on key metrics such as clinical outcomes, patient satisfaction, cost-efficiency, adherence to evidence-based guidelines, and low rates of denials for prior authorizations.
- Pattern Recognition: Use machine learning to recognize patterns of consistent, compliant, and cost-effective care from providers. This helps differentiate providers who deliver reliable and efficient services without unnecessary utilization of resources.
- Automated Approval: Once a provider meets the requirements for gold carding, the AI system can automatically approve routine procedures or services, reducing the need for manual intervention.
- Anomaly Detection: The AI can monitor ongoing performance to identify deviations from the gold standard, ensuring that only those who continue to meet high standards maintain their gold carding privileges.
AI and automation are crucial in reducing the manual labor involved in claims and prior authorizations. When coupled with point-of-care technology, they enable:
- Data Aggregation: Automatically collating relevant medical necessity data from EHRs ensures that necessary information is complete and organized. This step reduces human error and expedites payer review.
- Error Detection: Automated systems identify potential errors or incomplete submissions before they’re sent, significantly lowering the risk of denials due to minor inconsistencies.
- Real-Time Updates: AI tools can scan payer policy updates and rulesets and adjust requirements in real time, ensuring that submissions meet the latest standards and avoid rejections based on outdated criteria.
These advancements in automation not only streamline the prior authorization process but also minimize clinician burnout by reducing their involvement in repetitive tasks, ultimately allowing more time for patient-focused activities.
How can providers ensure the accuracy of patient data and stay up-to-date with constantly changing payer policies to minimize denials?
Oron Afek: Providers can reduce the risk of denials by:
- Implementing Real-Time Policy Check Systems: Leveraging tools that directly access payer portals and rulesets enables constant updates to payer policies, so every prior authorization aligns with the latest criteria.
- Routine Data Audits: Automated checks for missing or outdated information ensure accuracy. Systems can flag incomplete submissions and, where possible, auto-fill missing details or reroute them for human review.
- Centralized Information Systems: Integrating payer policy updates into EHRs provides clinicians and administrative staff with an updated, single source of truth. This approach reduces misinformation and helps maintain compliance with payer requirements.
What advice would you give to healthcare providers who are struggling to navigate the complexities of claim denials and prior authorizations?
Oron Afek: Healthcare providers facing these challenges must consider the following:
- Advocating for additional technology resources and innovations sponsored by payers that automate repetitive tasks and keep their staff in-workflow to reduce time spent on required processes.
- Investing in Automation: According to a study from the American Medical Association, providers spend, on average, 35% of their time on prior authorizations. Automation can reduce time spent on authorizations, reducing unnecessary delays and improving workflow efficiency.
- Tracking Metrics: Monitoring denial rates, average time spent on authorizations, and common rejection reasons provides valuable insights. This data can drive targeted improvements and highlight areas where further automation or training might help.
- Prioritizing Education and Training: Regular updates on payer policies and robust training on automation tools empower staff to handle authorizations more effectively and efficiently.
Adopting a proactive approach relieves administrative burdens, reduces denial rates, and ultimately enables healthcare providers to focus more on patient care.
About Oron Afek
Oron Afek is a recognized leader in the healthcare technology space, with extensive experience in developing solutions to streamline prior authorization processes and improve healthcare access. As CEO of Vim, he has a deep understanding of the complexities and challenges associated with claim denials and prior authorizations. Prior to Vim, Afek founded and led business development for four companies in telecommunications, gaming, real estate and education.