What does "prior authorization" mean in healthcare services?

"Prior authorization" refers to the requirement imposed by health insurance companies for providers to obtain approval before certain medical services or medications are provided to patients. This process is designed to ensure that the services requested are medically necessary and covered under the patient's insurance plan. By requiring this approval in advance, insurers can manage their costs and ensure that patients receive appropriate care based on established guidelines and protocols.

In the context of healthcare, this means that a healthcare provider must submit a request detailing the proposed service or medication to the insurer, who will then review the information and decide whether to authorize it. If the prior authorization is granted, it allows the service to proceed, and if it is denied, the provider may need to explore alternative options or appeal the denial.

Understanding this concept is crucial, as it can significantly impact patient care and the healthcare delivery process. Patients may experience delays in receiving necessary treatments if prior authorization is required and not processed in a timely manner, highlighting its importance in the healthcare system.