What is the purpose of prior authorization?

The purpose of prior authorization is to obtain approval for services before they are performed. This process involves the healthcare provider submitting a request to the insurance company to ensure that the proposed treatment or service is medically necessary and covered under the patient's insurance policy. Prior authorization is an essential step in managing the costs of healthcare and helps to prevent unexpected charges for patients. By requiring approval beforehand, insurance companies can manage which services they will cover and ensure that they are appropriate for the patient's condition. This process also helps to streamline care, as services that are not authorized may not be reimbursed, leading to financial implications for both the provider and the patient.