Life Sciences

Prior authorization costs: What are they?

Medicare & Reimbursement Advisor Weekly, December 4, 2009

For those who are curious, prior authorizations (PA) may be a safety and utilization management tool but they come with a cost each plan must weigh, particularly for drugs that have high prescribing rates. Each PA can run a health plan anywhere from $40–$100, depending upon what the plan is reviewing, the level of medical information it has to reproduce, and other factors specific to the plan. For example, a plan may have greater efficiencies, therefore, lowering the overall cost. For a PA that Regence instituted for erythropoiesis-stimulating agent products (Aranesp, Procrit, and Epogen), the cost was in the mid-to-lower end of that scale because of a more in-depth review, said Lynn Nishida, RPh, a director in the clinical services department for Regence, a Medicare MA-PD plan.