Prior Authorizations and the Adverse Impact on Continuity of Care

ABSTRACT

This commentary discusses the current prior authorization (PA) process and the negative impacts it can have on patient care. According to the American Medical Association, 94% of patients experience delays in care and 78% abandon treatment altogether. These delays in care are often for lifesaving treatments and can result in adverse events. Additionally, PAs place an extensive administrative and financial burden on both patients and providers, often requiring several hours of seeking approval from insurance companies or requiring patients to try one or more other therapeutic avenues before an insurance company will approve the original course of treatment. This is all while insurance companies are making record profits each year. Frustrations with this system are leading to a rise in the number of physician practices switching to a cash-only business model, which increases autonomy, enables price transparency, and benefits both physicians and patients.

Am J Manag Care. 2025;31(5):In Press

Takeaway Points

• Insurance companies are engaging in cost-cutting measures, such as requiring prior authorizations for prescriptions and other medical procedures.
• Prior authorizations result in 94% of patients experiencing delays in care and 78% abandoning treatment altogether.
• Prior authorizations create extensive time and financial burdens for physicians and patients, disrupting continuity of care and often leading to adverse events.

Health insurance is supposed to increase access to care1 and help contain rising medical costs.2 Instead, it appears the opposite is happening,3,4 with health care costs continuing to rise, forcing insurance companies to engage in cost-cutting measures. The success of managed care programs in cutting costs is largely due to the fact that they negotiate lower provider reimbursement rates, provide narrow network offerings, and reduce or eliminate services offered.4,5 This is often achieved through denying claims or requiring prior authorizations (PAs) on selected procedures and prescription drugs.6

Prior Authorizations

According to the American Medical Association (AMA), PA “is a health plan cost-control process that requires health care professionals to obtain advance approval from the health plan before a prescription medication or medical service qualifies for payment and can be delivered to the patient.”7 Some claim denials occur because a PA for a specific procedure code is granted but the hospital or physician bills for a different one,8 and other denials may be the result of erroneous information received from the insurance company during the approval process. Although, in theory, the PA process can reduce waste and limit unnecessary services, which would have a potential downstream effect of lowering premiums and other out-of-pocket costs for beneficiaries, it can present substantial administrative, time, and financial burdens on clinicians.4,9-13

The process for getting PAs approved can often result in time delays in patients receiving adequate care,13,14 with the AMA reporting that 94% of patients experience care delays and 78% report the abandonment of treatment.7 The argument could also be made that in some cases, PAs end up costing the health insurance plan and the patient more by requiring the patient to try several other methods of therapy before the insurance company ultimately ends up approving what was prescribed in the first place.

Continuity of Care

The delays in care as a result of these PAs and approval processes can have detrimental effects on both patients and providers. According to the AMA, 24% of physicians reported that in 2023, a PA led to a serious adverse event for patients.7 Providers are already facing immense pressure to see more patients in less time.15 Yet physicians and their office staff complete approximately 43 PAs per physician per week, averaging around 12 hours per week.7 Additionally, at least 35% of physicians have hired staff to work on nothing but PAs, and 53% of physicians report that PAs have negatively affected their job performance.7

One of the aspects that providers find the most frustrating about the PA process is that there is no clear road map to approval.13,16 Obtaining approvals often takes multiple attempts, with the process sometimes taking days, weeks, or months and often requiring some type of peer-to-peer (P2P) review with a specialist from the insurance company.11,17 These P2P reviews, as described by prior researchers, are often “formulaic or may be conducted by nonpracticing clinicians or those with inadequate clinical expertise in the specific domain.”9 Additionally, 82% of providers report that PA requirements from payers are increasing.7,18

Overwhelmingly, physicians who were surveyed reported that PAs interfere with continuity of care and can destabilize patients whose conditions were previously stable.7 Numerous studies have explored the impact of PAs on patient care for specific conditions and specific medical specialties as well as the administrative and financial burdens they create.19-24 Because of this, we are beginning to see a rise in the number of physician practices transitioning to a cash-only business model, which allows physicians to have more autonomy over their practices, reduces billing and administrative requirements, eliminates the need to deal with insurance companies directly, offers price transparency, provides flexibility in practice offerings, and offers physicians a more predictable revenue stream.25-27 Furthermore, consumers benefit from cost predictability (the lack of which is often a deterrent for those who are uninsured or underinsured), making it much more likely that they will get the care they need.28 Additionally, physicians have more time to spend with patients without the administrative burdens of dealing with health insurance companies.

Conclusions

Ultimately, something has to give with regard to the current state of health insurance in the United States. Social media platforms including TikTok are full of physicians and patients telling their stories of how vital medical interventions for conditions such as diabetes or cancer were delayed for weeks or months by their insurance providers through PAs. As insurance premiums and deductibles rise each year, it feels as if the insurance companies are paying for less, leaving patients to pay more out of pocket or to forgo treatment altogether. This feels especially sinister when these health insurance companies made more than $41 billion in profit in 2022 and have made more than $371 billion in profit since the Affordable Care Act was passed.29,30 Consumers don’t appreciate paying high out-of-pocket costs for things like health insurance while feeling like they get nothing of value in return. As cash-only practices continue to grow in popularity and number, if insurance companies aren’t careful, in the not too distant future, they could find themselves on the outside looking in. 

Author Affiliation: Department of Political Science, Auburn University, Auburn, AL.

Source of Funding: None.

Author Disclosures: The author reports no relationship or financial interest with any entity that would pose a conflict of interest with the subject matter of this article.

Authorship Information: Concept and design; analysis and interpretation of data; drafting of the manuscript.

Address Correspondence to: Jay S. Pickern, DBA, Department of Political Science, Auburn University, 7080 Haley Center, Auburn, AL 36849. Email: jsp0086@auburn.edu.

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