New Brunswick, N.J.-based St. Peter’s Healthcare System CFO Garrick Stoldt said his health system is feeling ready for the new traditional Medicare prior authorization pilot that is set to begin Jan. 1.
“We’re a hybrid of employed physicians and community physicians,” Mr. Stoldt told Becker’s. “And whether it’s our employed or community physicians, the office practices for those physicians do the actual authorization. What we have done to address this is we have trained all our financial advisers and anyone involved in the administration process [to identify] those cases to make sure that we have that Medicare prior authorization. Even though it’s generally been described as the office practice responsibility, we’re the backup to make sure that we have an authorized procedure before we do it, and if we don’t get that authorized procedure, we don’t do the procedure.”
Mr. Stoldt said that has always been the case regarding prior authorization, “so this isn’t really new, it’s just a nuance to it because it’s just a select group of procedures that now have that.”
CMS unveiled the Wasteful and Inappropriate Service Reduction initiative in June, with six states, including New Jersey, selected for the pilot. Under the model, CMS will partner with companies specializing in AI and machine learning to test ways to provide an improved and expedited prior authorization process for certain Medicare services. The companies hired to manage the initiative will be paid based on how much money they save the federal government by stopping payment for unnecessary or noncovered services.
CMS said the 17 initial targeted services include those particularly vulnerable to fraud, waste and inappropriate use, including epidural steroid injections for pain management, cervical fusion, skin and tissue substitutes and arthroscopy for knee osteoarthritis.
“We’re prepared for it,” Mr. Stoldt said. “In revenue cycle, our trainers have been instructed on the new procedures. Our financial advisers — which do the checking on cases before they come in — are also informed on it and educated on it. And now we’re just getting the ‘cheat sheets’ in place to make sure, if you have a neurosurgery practice, that you know that ‘here’s the five codes or six procedures that we have to be worried about.’ When you get it down to the nitty gritty by the office, it makes it easier to manage.”
The “million-dollar question,” as Mr. Stoldt put it, is about denials.
“If we don’t get the prior auth, we’re not doing the procedure,” he said. “So we’re protecting ourselves from that standpoint. But the disruption to our patients is the bigger concern. If our patients are trusting in our doctors to do a procedure on them and then Medicare says, ‘Oh no, we’re not going to approve it’ — which is happening in the managed care world right now — that’s a huge disruption. If you talk to patients today, a lot of them say, ‘Well I had this denied. I had to fight to get it approved,’ and that is giving the whole industry a black eye.”
Mr. Stoldt said he is not expecting any significant problems for the new program.
“It’s just, how many cases do we have to fight? What other resources do we have to bring to bear?”
The pilot is scheduled to run through 2031.
