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Prior Authorization Request Case Study: The Power of Operational Analytics and Process Automation in Healthcare

Tony Lazar, DocuStream and Rajib Ghosh, Health Roads

May 2018

Our client, a Medi-Cal community Managed Care Organization (MCO) in California, saw their managed care membership grow by more than 60% between 2013 and 2014 due to Medi-Cal expansion as part of Affordable Care Act (ACA). The organization wasn’t prepared for such rapid growth. Demand for medical services grew and all costs related to the managed care operations spiraled out of control. Staff struggled to keep up with the increased volume of work under strict regulatory requirements of turnaround times. The plan’s COO identified utilization management (UM) as one of the highest cost functions since it employs registered nurses and physicians to review the medical necessity of requested services. Even though the UM department was rapidly increasing its workforce to keep up with demand for its services, it still could not meet state-mandated turnaround times for service requests. The COO called in a team from Health Roads and DocuStream to observe the UM workflow and do a time study, workflow shadowing, and analysis of the production data to optimize business processes. The team quickly observed that faxed authorization request documents were at the core of the problem.

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