Maine currently has no legislation pertaining to prior authorization.
This report summarizes the current state of the electronic prior authorization (ePA) industry. The intent is to quantify the impact of prior authorization (PA) to patients and providers, update the industry on the current ePA adoption and implementation rates by market leaders and outline the most important factors to consider when evaluating an ePA solution provider.
The ePA National Adoption Scorecard is written and published by CoverMyMeds with guidance from industry experts on the ePA National Adoption Scorecard Advisory Board:
Lee Ann Stember
President, National Council of Prescription Drug Programs
VP, Industry Relations, Cardinal Health
EVP & CEO, National Alliance of State Pharmacy Associations
Senior Strategist, Orders and Medication Strategist, Cerner Corporation
Dr. Lynne Nowak
Medical Director, Express Scripts
Executive Director, Virginia Association of Health Plans
Electronic prior authorization is the automated process of exchanging patient health and medication information required to help the patient’s prescription coverage plan make a coverage determination.
Today, many prior authorization requests are completed through a manual process that involves phone calls and faxes between the pharmacy, provider and health plan. This is an inefficient, time-consuming process that leads to the patient abandoning the prescription 40% of the time.1
Electronic prior authorization automates this process by allowing the provider to initiate the ePA prospectively within their E-Prescribing workflow. The most successful ePA strategies also connect the pharmacy to initiate an ePA that was missed at the point of prescribing, and allow the provider to complete a pharmacy-initiated PA electronically in their EHR or a designated ePA web portal.
The ePA process involves a four-part transaction established in the National Council for Prescription Drug Programs (NCPDP) SCRIPT Standard that enables patient and drug-specific PA criteria and a real-time approval process.
As ePA capabilities and adoption grow, particularly in the EHR space, there is often confusion as to the difference between ePA and electronic prescribing (E-Prescribing). A common misconception is that if a provider is E-Prescribing, they are also completing PA requests electronically. While E-Prescribing and ePA will ideally occur in the same workflow within an EHR, they are not the same service.
Electronic prescribing allows providers to write and submit prescriptions to pharmacies electronically through an EHR, rather than handwriting or calling it in to the pharmacy. It is beneficial to the patient in that they don’t have to worry about bringing a paper copy to the pharmacy because the doctor submitted it electronically.
Electronic prior authorization occurs after a prescription is prescribed when a pharmacist or provider is notified that the patient’s health plan requires prior authorization to ensure coverage. Electronic prior authorization transforms the existing paper PA process into a real-time exchange of information that determines insurance coverage for a prescribed medication.
While electronic fax is not directly connected to the payer, it allows providers to submit a PA request using the same electronic workflow, regardless of the ePA capabilities of the payer. The pharmacy or provider may still initiate the PA and complete it electronically. It is then delivered to the payer via fax for processing.
Medications are typically characterized as specialty based on high cost, special handling requirements and treatment of chronic, complex conditions. In many cases these drugs are curative, but also expensive for health plans to cover and typically require prior authorization.
In today’s landscape E-Prescribing can be challenging for providers due to the complexity of determining coverage and limited pharmacy distribution. The question is often asked if ePA can be used for a specialty medication, even when E-Prescribing does not offer the ideal solution. The answer is yes.
The ePA process was designed to accommodate retail and specialty drugs and is critical for these treatment plans when speed to therapy is important. According to CoverMyMeds data, most specialty pharmacies leverage ePA technology, and providers are increasingly initiating and completing PA requests electronically in a web portal or integrated EHR.
Specialty medications accounted for 37% of U.S. drug spend in 2015 and are projected to reach 50% by 2018.2 The high cost is rooted in lack of generic alternatives, complex delivery, the need to educate the patient on administration and patient monitoring. That said, a patient consistently adherent to therapy will gain maximum benefit, decreasing medical costs associated with the disease.3
By 2020, a projected 9 out of 10 top-selling drugs by revenue will be specialty.4 These medications are time intensive for providers and the pharmacy, requiring multiple phone calls, coverage investigation and prior authorization. Electronic prior authorization is a way to increase patient access, decrease waste and support a value-based pharmaceutical market.
Seventy percent of prescriptions rejected at the pharmacy require PA and 40% of those prescriptions are eventually abandoned due to the complex, paper-based PA process. The PA process impacts more than 185 million prescriptions each year, and results in nearly 75 million abandoned prescriptions. This increases the risk of future health problems or hospitalization for the patient. The utilization of an electronic solution may increase patient medication adherence by helping to ensure the patient leaves the pharmacy with a prescription in hand.5
Prior authorization has an immense effect on health care professionals of all types. Dealing with PA requests consumes a large number of hours for physicians, nurses and their staff, negatively impacting workflow and time spent with patients.
There is a direct correlation between the perceived burden of PA and clinical responsibilities attached to the individual working on the request. A health care provider whose main focus should be on patient care and the prescribing of medication, perceives PA to be more of a burden than a PA specialist who has dedicated resources in assisting them with their workload.
Fortunately, ePA can ease the burden for providers across the board. The burden of PA is significantly lower for providers exclusively using an electronic method for PA versus those using fax and phone, or a combination of fax, phone and electronic channels.
Those who report using an electronic method to submit PA, on average spend 2.5 fewer hours on PA per week.
As it stands, few providers exclusively use an ePA solution. Data indicates 76 percent of providers use more than one channel to complete PA requests. 6
Use of phone and fax channels to complete PA requests result in delays to therapy and additional administrative waste. There is the opportunity today for providers to exclusively use an electronic channel through utilization of an all-payer, all-medication ePA web portal.
Across the board, providers agree that ePA can increase speed to therapy, positively impact their organization and decrease the likelihood of prescription abandonment. Ninety-five percent of providers indicate they are likely to learn a new technology, such as ePA, if they agree with these benefits.
By leveraging ePA, providers eliminate paperwork, ensure PA requests are submitted in a secure environment and receive faster (often immediate) determinations. These benefits relieve the burden associated with the PA process, which is necessary to ensure patients receive access to appropriate therapy. Beyond the benefit to providers, health care professionals believe ePA will increase speed to therapy and decrease prescription abandonment, ensuring patients receive the medication they need to live healthy lives.
Prior authorization legislation has been in consideration—and in some cases in effect—since 2013. The intent of legislation is to make the PA submission process faster and easier for providers to prevent the delay of patient treatment. Unfortunately, with no federal direction, each state is on its own path. In many cases, that path leads to legislation that simply updates how paper forms are used, or provides an option for electronic submission, rather than legislating a mandate for ePA.
Calls for the use of an electronic method for submitting medication prior authorization in compliance with the NCPDP SCRIPT Standard.
Calls for the use of an electronic method for submitting medication prior authorization, but names no standard.
Calls for the use of a universal or standard form for medication prior authorization approved by the state’s Department of Insurance.
Calls for the use of a universal or standard form as well as the use of an electronic method for submitting medication prior authorization.
7- CoverMyMeds Government Affairs Team
The increase in legislation around PA and ePA has become more prevalent at the state level. The mandates range from use of a standardized form for submission to mandating the use of the NCPDP SCRIPT Standard for ePA. Select your state from the dropdown to learn where legislation stands.
Alabama currently has no legislation pertaining to prior authorization.
Alaska currently has no legislation pertaining to prior authorization.
Arizona currently has no legislation pertaining to prior authorization.
A health care insurer must utilize only a single standardized PA and nonmedical review form for obtaining approval in written or electronic form for prescription drug benefits. The form must be accessible through multiple computer systems. The required form must not exceed two pages and be designed to be submitted electronically from a prescribing provider to a health care insurer.
The Department of Managed Health Care and the Department of Insurance are jointly creating a standard PA form. On and after July 1, 2017, or 6 months after the form is completed, every prescribing provider must use that uniform PA form, or an ePA process to request PA.
Every health insurer should accept that form or electronic process as sufficient to request PA for prescription drugs. A prescribing provider may use an ePA system utilizing the standardized form or an electronic process developed specifically for transmitting PA information that meets the NCPDP SCRIPT Standard for ePA transactions.
All carriers must utilize the uniform PA process established by the regulation. A PA process for a drug benefit must allow for electronic submission but is not required. The carrier must make available on their website the standard form for PA for a drug benefit.
Connecticut currently has no legislation pertaining to prior authorization.
The insurer must accept and respond to PA requests through secure electronic transmission using the NCPDP SCRIPT Standard for ePA transaction. Faxes, proprietary payer portals and electronic forms are not considered electronic transmissions.
A health insurer or a PBM on behalf of the insurer, which does not have an electronic PA process for its contracted providers must use only the PA form approved by the Financial Services Commission.
Electronic prior authorization requests must be accessible and submitted by providers to PBMs and health plans through secure electronic transmissions utilizing the current NCPDP SCRIPT Standard for ePA.
The health care provider is not required by adopted code to participate in ePA in order to obtain the necessary authorization for patient care; however, faxes are not considered an electronic submission except in the event that such ePA is temporarily unavailable due to system failure or outage.
Hawaii currently has no legislation pertaining to prior authorization.
Idaho currently has no legislation pertaining to prior authorization.
Illinois currently has no legislation pertaining to prior authorization.
Effective Jan. 1, 2018, the bill requires a health plan to accept and respond to a PA from a prescriber or a pharmacist through an electronic transmission using the NCPDP SCRIPT Standard. Encourages all entities to use a common form for PA but no standard form created or mandated.
Law: ARC 2348C
The regulation requires each insurer to create a PA form unique to that insurer, not to exceed two pages and to be approved by the Commissioner of Insurance. The form must be made available electronically by the carrier or PBM. The form to be submitted by the health carrier must take into consideration forms developed by CMS or U.S. Department of Health and Human Services and any national standards to include the NCPDP SCRIPT Standard.
The division recognized the importance of technology to the industry and modified the proposed rule to emphasize that the statutory language requiring a form does not preclude the use of or compliance with NCPDP SCRIPT Standards.
Kansas currently has no legislation pertaining to prior authorization.
Law: SB144; KRS 217.211
NCPDP adopted ePA standards in 2013. Within 24 months of the NCPDP developing and making available national standards for ePA, each governmental unit of the Commonwealth communicating administrative regulations relating to electronic prescribing must consider E-Prescribing and ePA standards in its implementation of health information technology improvements as required by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 and the Health Information Technology for Economic and Clinical Health Act, enacted as part of the American Recovery and Reinvestment Act of 2009.
Insurers were required to create their own standard PA form, no more than 2 pages in length and made it accessible through multiple computer operating systems. The forms must be filed with the Department of Insurance.
Maine currently has no legislation pertaining to prior authorization.
Online, web-based process required by payers and PBMs. Providers are required to use payer web portal OR standard transaction that has been established and adopted by the health care industry via EMR. Additional requirements regarding Step Therapy we also added.
Nothing should prohibit a payer or any entity acting for a payer under contract from using a PA methodology that utilizes an internet webpage, internet web portal or similar electronic, internet and web-based system in lieu of a paper form, provided that it is consistent with the paper form.
A payer or any entity acting for a payer under contract, when requiring PA, must use and accept only he PA forms designated for the specific type of services and benefits.
If an insurer uses a PA methodology that utilizes an internet webpage, internet web portal or similar electronic, internet and web-based system, they will not be required to utilize the standard form adopted by the Department of Financial Services, Community Health or Insurance. The form approved by the Department of Insurance and Financial services must be used in requesting PA for prescription drugs.
Drug PA requests must be accessible and submitted by health care providers, and accepted by group purchasers, electronically through secure electronic transmissions. Fax should not be considered an electronic transmission.
The Minnesota Prescription Drug Companion Guide v1.1, names the NCPDP SCRIPT Standard for ePA transactions as the methodology for secure electronic transmissions. All health care providers must submit requests for formulary exceptions using the uniform form, and all payers must accept this form from health care providers.
A health insurance issuer must use only a single, standardized PA form for obtaining any PA for prescription drug benefits. The form must also be made available electronically and the prescribing provider may submit the completed form electronically to the health benefit plan.
Missouri currently has no legislation pertaining to prior authorization.
Montana currently has no legislation pertaining to prior authorization.
Nebraska currently has no legislation pertaining to prior authorization.
Nevada currently has no legislation pertaining to prior authorization.
Requires the Commissioner of Insurance to create a universal PA form to be accepted and used by insurers when requiring PA for medications or use of the NCPDP SCRIPT Standard for ePA.
Electronic prior authorization is not required if a pharmacist or prescriber lacks broadband Internet; or has low patient volume; or has opted-out for a certain medical condition or for a patient request; or lacks an EMR system; or the ePA interface does not provide for the prepopulating of prescriber and patient information; or the ePA interface requires an additional cost to the prescriber. Does not apply to Medicaid.
Rule INS 2705, passed March 8, 2017, Department of Insurance adopted PA universal form as required by HB1608.
PROPOSED: Repeating bill. Would require the Commissioner of Banking and Insurance to develop a standard PA form for prescription drugs for use by network providers. Must be available in paper and electronic form.
Requires a uniform PA form to be used by all plans. A health insurer must exchange PA requests with providers who have E-Prescribing capability.
Requires the Department of Health and Financial Services to develop standards for PA, taking into consideration the NCPDP SCRIPT Standard.
North Carolina currently has no legislation pertaining to prior authorization.
A drug PA request must be accessible to a health care provider with the provider's E-Prescribing software system and must be accepted electronically, through a secure electronic transmission, by the payer, insurance company or the PBM responsible for implementing or adjudicating the authorization or denial of the PA request. For purposes of this section, a fax is not an electronic transmission.
Effective Jan. 1, 2018, insurers must permit health care providers to access the PA form through applicable electronic software. Insurers and PBMs must also accept PA requests through a secure electronic transmission using the NCPDP SCRIPT Standard.
Faxes are not considered secure electronic transmissions and proprietary payer portals are not considered secure transactions unless they use the NCPDP SCRIPT standard. Prescribers and insurers can enter into contractual agreements foregoing this process if is an undue hardship.
A health benefit plan must utilize PA forms for obtaining any PA for prescription drug benefits. A form shall not exceed three pages. The form may be customizable to a specific drug. A health benefit plan may make the form accessible through multiple computer operating systems.
Plans must accept the requested universal PA form through any reasonable means of transmission, including but not limited to paper, electronic or another mutually agreeable accessible method of transmission or using an internet or web-based system.
Pennsylvania currently has no legislation pertaining to prior authorization.
Rhode Island currently has no legislation pertaining to prior authorization.
South Carolina currently has no legislation pertaining to prior authorization.
South Dakota currently has no legislation pertaining to prior authorization.
Tennessee currently has no legislation pertaining to prior authorization.
Standard state adopted PA form required for PA requests. Mandate requires acceptance of NCPDP SCRIPT Standard of ePA.
Utah currently has no legislation pertaining to prior authorization.
When requiring PA for prescription drugs, a health plan must accept for each PA request either the national standard transaction information or a uniform PA form. A health plan must have the capability to accept both the national standard transaction information and the uniform PA form.
Requires carriers to accept phone, fax or electronic submission of PA requests that are delivered from E-Prescribing systems, EHRs and health information exchange platforms that utilize the NCPDP SCRIPT Standard.
Requires all PA forms accepted by the carrier be made available through one central location on the carrier's website and that information be updated by the carrier within seven days of approved changes.
Law: CR102 Proposed PA
In addition to other methods to process PA requests, a carrier or its designated or contracted representative that requires PA for services must have an electronic process that is browser-based for a participating provider or facility to upload documentation and complete a PA request.
PROPOSED: Any provider contract between an insurer and a participating health care provider, or its contracting agent, pursuant to which the insurer has the right or obligation to require PA for a drug benefit, must contain specific provisions that:
(1) Accept universal PA forms;
(2) Permit the electronic submission of PA requests using methods and systems that are interoperable with E-Prescribing systems, EHRs and health information exchange platforms. Permitted electronic submission formats must conform to the NCPDP SCRIPT Standard.
Wisconsin currently has no legislation pertaining to prior authorization.
Wyoming currently has no legislation pertaining to prior authorization.
Twenty-eight states have legislation pertaining to PA, with pending legislation in West Virginia, Washington, New Jersey and New Hampshire. Many states still require the use of a standard, “universal” form for PA. While this is a step in the right direction, the legislation merely replaces existing forms, rather than improving the PA process. More states should consider implementing legislation that favors the use of an electronic standard, with particular emphasis on the existing NCPDP SCRIPT Standard.
The integration of ePA within EHR systems is potentially transformative to providers and their staff by providing decision support at the point of prescribing and a method for completing PA in workflow. Realizing this potential is largely dependent on vendors supporting retrospective, prospective and all-payer capabilities.
Electronic prior authorization integrations that incorporate these capabilities essentially eliminate the need for paper PA forms. Integrations that are missing one or more of these capabilities will still require providers and their staff to use multiple methods for completing PA requests.
Current percentage of the EHR market, representing the majority of market share, committed to an ePA solution.
EHRs representing 73% of market share are committed to implementing ePA. With the right ePA partner, an electronic solution can be a significant revenue opportunity for EHRs and time-saver for health systems, while benefiting the provider and their patient. Additionally, ePA in EHRs is the best way to add ePA legislative compliance to the E-Prescribing experience.
Payer integration of ePA functionality ensures all PA requests may be reviewed and determined electronically. For payers, ePA eliminates manual entry of faxed or phoned PA requests, enables payers to receive complete information on initial submission and can facilitate real-time determinations based on payer-specific criteria.
Auto-determination functionality helps payers auto-review requests and provide real-time determinations based on preset criteria. In many cases, providers receive the outcome within moments of submission.
Indicating a payer is live with ePA does not mean all medications or plans—in the case of a PBM—use ePA functionality. The majority of payers initially activate ePA for a select number of medications or plans that they service while they work toward electronic incorporation of all criteria, which differs by plan and medication.
Percentage of the payer market, representing the majority of market share, committed to an ePA solution.
Nearly the entire payer industry with leading market share is committed to ePA and are bringing additional lines of business onto their electronic solution. By doing so payers are creating greater access for providers and decreasing turn-around time; however, there is still work to be done for each payer to get every line of business on ePA and increase usage of auto-determination functionality.
The majority of PA requests are still initiated at the pharmacy, causing an administrative burden for pharmacists trying to fill prescriptions for their patients and often causing the patients to have to leave the pharmacy without their prescription in hand. Integrating ePA functionality into pharmacy systems gives pharmacists the ability to create a PA, auto-fill patient and medication information and electronically send it to the provider in one or two keystrokes.
Percentage of the pharmacy market, representing the majority of market share, committed to ePA.
There exists a wide range of functionality available from ePA vendors. A comprehensive solution meets the needs of all stakeholders while creating an efficient, in workflow solution for providers and pharmacists. The wrong solution could create administrative waste, varying workflows based on the health plan associated with a PA request, cause confusion between stakeholders and hinder a patient getting the medication they need to be healthy.
One hundred percent of pharmacies are committed to implementing ePA. Pharmacies across the country are seeing consolidations, which temporarily could inhibit the use of ePA, and if not handled well could have a negative impact on the pharmacist’s workflow. Many independent pharmacies have access to ePA functionality through pharmacy systems, most of which have live, integrated ePA capabilities.
It is important to understand how an ePA vendor will accomplish key goals needed to successfully complete PA requests. While it’s important to clarify pricing and ease of implementation, these are not the only factors to consider when selecting who to work with. The wrong solution could create administrative waste, cause confusion between stakeholders (payer; pharmacy; provider) and hinder a patient getting the medication they need to be healthy.
It is important that PA requests can be submitted to any plan in the same ePA solution and workflow. Ideally, the ePA vendor will have a direct, electronic connection with payers representing the vast majority of prescription volume, and the ability to facilitate auto-determinations.
It is equally important to facilitate an electronic workflow for providers that connects with health plans who are not ePA enabled. While the majority of the payer market is working toward ePA availability, there remain lines of business, regional plans and Medicaid and Medicare Part D plans that are not yet live with ePA functionality.
A prospective ePA occurs when a provider initiates the request before a rejection occurs at the pharmacy. With the right vendor, it is possible to proactively begin a request at the point of prescribing, directly within the EHR system.
Retrospective ePA occurs when a pharmacy is alerted that PA is needed when they bill insurance for the medication. The pharmacist can initiate the PA directly in their pharmacy system, which triggers a notification to the provider. Retrospective PA accounts for the majority of PA volume today.
A preferred vendor provides both capabilities. Good questions to ask are: How many pharmacies currently leverage your ePA functionality? How many pharmacy-initiated requests are generated through your system?
Auto-determination functionality enables payers to set criteria for PA determinations to eliminate manual review. The result is a more efficient process for payers and faster determinations for providers. Electronic prior authorization vendors who offer this functionality should allow full customization of the criteria used to make an auto-determination.
Implementation costs will be similar for each ePA provider, and while it is important to find out how much it will cost to integrate a solution into an EHR, it is also important there be full disclosure in subscription fees and any other costs that may be accrued or assessed. Health systems often cite cost as a barrier for not implementing an electronic solution, so it’s important to get this information in advance.
Electronic prior authorization should always be free to use for providers, pharmacists and their staff.
The market stands to save billions of dollars when all stakeholders, especially providers, adopt ePA solutions at scale. Financial models that are free for providers and pharmacists encourage ubiquity and are therefore in the best interest of all stakeholders.
The technology for ePA solution will grow and change with the industry; therefore, API support makes it easier for technology teams at EHR, payer and pharmacy systems to quickly implement new and optimized ePA solutions. Documented, standards-based ePA APIs will be a key to driving adoption in the market.
Providers will have questions as they adopt an ePA solution, so it’s important that your vendor provides direct, user support. The support staff should be easily reachable by phone, email and chat and be subject matter experts on the ePA solution. Electronic prior authorization, as with any new IT solution, does require a change in workflow; therefore, it’s important to support providers and their staff.