Plan sponsors may benefit from using electronic drug prior authorization

While prior authorization can be a great tool for plan sponsors, it comes with its own set of challenges, said Tara Liu, director of drug strategy at Canada Life, during Benefits Canada’s Face to Face Drug Plan Management Forum on Dec. 9, 2020.

The pharmaceutical pipeline is focused on high-cost specialty drugs, which are being used in more chronic, highly prevalent conditions, Liu said, noting this volume is growing quickly with an aging population. Many of these reviews require health-professional involvement by the payers as well, she added, and the complexity of criteria is expected to increase in the future. “We also have work created by missing information, incomplete and ineligible forms, which creates a back-and-forth between plan sponsors, members and doctors.”

By having a manual “stop” in the process of adjudication and dispensing at the pharmacy level, she added, payers can take extra steps to mitigate the risk of paying for inappropriately high-cost claims, said Liu.

When it comes to electronic prior authorization, there are a host of different models and views, said Jason Kennedy, director of health business consulting at Telus Health, who also spoke during the forum session. As a paper-based process for payers and reviews, prior authorization is essentially a swivel-chair process, meaning information is provided and reviewed in a form and there’s a decision made, he added, and then there’s another process that happens to add to that exception or trigger a communication to the member. Conceivably, digitizing this process could remove a step from the payers’ review and the time associated, speed up the process and reduce data entry errors.

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Converting the paper-based process for prior authorization into data points will unlock richer analytics and insights for a carrier, said Liu. With digital submission, all the key information is present and there’s opportunity to integrate with adjudication and make an end-to-end digital process, she added. “More data allows payers to inform future plan design options around prior authorization and formulary management.”

Digitizing this process improves the plan member experience by decreasing the time to a decision, said Liu, noting it also removes some of the administrative work on drugs that are more straightforward, allowing payers to focus deeper reviews on more complex cases.

“By simplifying the process and making it digital, payers and plans can broaden the scope of prior authorization to lower-cost, higher-volume drugs that have more cost-effective alternatives and clear step therapy guidelines that recommend certain drugs be tried first.”

Decisions on what drugs are added to prior authorization are complex, and some of the factors are administrative burdens, Liu noted. “With digitization, those factors are less of an influence and allow payers and sponsors to go to areas where we can’t administratively today. Digitizing the process has benefits for all stakeholders, including plan members, plan sponsors payers and physicians.”

Other markets with electronic prior authorization, in some cases, are more than 10 years ahead of Canada, which is significant, said Kennedy. However, an advantage of having other jurisdictions go first is that we can apply their learnings to the Canadian landscape, he added. “Multiple players exist and they each have their own ideas on what a digited ePA process looks like, resulting in different trigger points.”

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Divergence has created complexity, noted Kennedy, which has resulted in challenges getting complete adoption of electronic prior authorization between the number of family physicians, multiple portals and several sets of criteria. “This has resulted in a situation where even in areas where ePA exists, there’s data that says only 35 per cent of the forms are transmitted online. So how do we increase this?”

Canada still doesn’t have real electronic prior authorization, but the landscape around it has changed, Kennedy said, noting there are specialty modules currently predominating the prior authorization process, but also the intricacy of that criteria. “We have complexity for the treatment of the patient and the cost, which has resulted in the emergence of patient support programs that have embedded themselves in the patient journey in a way they weren’t 10 years ago.”

Read more stories from the 2020 Face to Face Drug Plan Management Forum.