As of July 1, HMSA members have been burdened with a new authorization form for all lab tests. HMSA has partnered with Avalon, a corporation that can deny claims after lab tests have been performed, resulting in unexpected charges for patients. While HMSA claims this policy will save money, the reality is that the increased documentation load on clinics and the hefty fees paid to Avalon will cost the people of Hawaii both in dollars — and perhaps even in lives.
Most people have been affected by prior authorizations in health care. Health care providers often cannot order the tests, procedures or medications they believe are necessary for their patients until they prove to the insurance company they are indicated. This could be reasonable if it were limited to extreme procedures or medications. However, prior authorizations are often required for drugs as inexpensive as $20 and for procedures that are the standard of care.
Nationwide policymakers are acknowledging that this is the time to remove obstacles to care and provide more access to primary care by limiting prior authorizations. The addition of Avalon authorizations, however, takes us in the opposite direction.
The average clinic already spends 40 hours (about 1-1/2 days) a week performing prior authorizations, representing an enormous diversion of resources from patient care.
According to the Kaiser Family Foundation, only 6% of prior authorizations were denied in 2021. This means that 94% of the time, the patients were delayed care, which was deemed necessary, and that 94% of the time, no money was saved; only resources were wasted. Insurance companies can no longer pretend that the excessive use of prior authorizations and similar policies causes no cost or harm.
If the 3,510 primary care providers in Hawaii spend just one hour a week dealing with the new requirements added by Avalon, it effectively removes more than 80 prim- ary care providers from our already strained health care system. This program also affects specialists, pushing them to their limits. The hours spent on these requirements could be better used seeing patients and providing preventive care, highlighting the urgent need for change.
The Avalon implementation teams have minimized health providers’ concerns: Providers are told they can avoid denials by checking to see if their orders will be approved on the Avalon website. This takes time, not unlike the time needed for a traditional prior authorization.
Further, this process does not guarantee that the labs will be paid for, so the patient can still be stuck with the bill.
Lastly, and possibly the most aggravating, the providers cannot look up what documentation is needed to have the labs authorized because that information is “proprietary” and can be seen only by Avalon.
Your primary care physician or specialist can only log on and perform a meaningless virtual prior authorization or make their best guess, highlighting the lack of transparency in the system.
Despite concerns from physicians, executives at HMSA will not want to discontinue its relationship with Avalon even when faced with these issues because to end the contract, it will still have to spend millions of dollars.
The Hawaii Provider Shortage Crisis Task Force and its partners will introduce legislation next session to rein in these runaway policies.
People can support these efforts by contacting their politicians and organizations with political sway, such as unions and trade organizations. Legislation is necessary so health care providers can care for patients more and stare at computer screens less.
Dr. Esther Smith is a family physician, Hawaii Provider Shortage Crisis Task Force board member and West Hawaii Independent Physicians’ president.
