Insurance eligibility verification is the process by which medical practices confirm the status of a client’s insurance policy. It helps ascertain if
(a) will the insurance policy of the patient cover a medical service/ procedure
(b) up to what value?
It tells the practice staff the health plan status (active/ inactive), the co-payments, coverage, deductibles, and coinsurance.
A defunct eligibility verification process will significantly increase claim denials and decrease a medical practice’s chances of getting paid.
If insurance eligibility verification indicates coverage, prior authorization throws light on the specific conditions under which the claim will be honored by the payer for a medical prescription, service, tests, treatment, or procedure.
While a prior authorization does not guarantee payment of a claim, obtaining the approval improves the chances of the claim being met. The prior authorization conditions can be as follows:
- The period within which the medical service should be performed.
- The number of physician visits approved for the medical condition in a specified period.
- Other requirements are specific to the prior authorization issued by the payer.