Which term describes insurer approval required before performing a service?

Which term describes insurer approval required before performing a service?

• A. Preauthorization
• B. Prior authorization
• C. Pre-certification
• D. Post-authorization

Answer: (A)

Preauthorization is the insurer’s formal approval obtained before performing a service to confirm it’s medically necessary and will be covered under the patient’s plan. The process involves submitting details about the planned procedure, the patient’s diagnosis, and justification for the service. When approval is granted, the service is authorized for coverage; if it’s denied, the provider may not be reimbursed or the patient could face higher costs. Some payers use the term prior authorization or precertification, but the essential idea remains the same: getting approval ahead of the service. Post-authorization would be approval after the service, which doesn’t help plan and pay for the procedure in advance.

Preauthorization is the insurer’s formal approval obtained before performing a service to confirm it’s medically necessary and will be covered under the patient’s plan. The process involves submitting details about the planned procedure, the patient’s diagnosis, and justification for the service. When approval is granted, the service is authorized for coverage; if it’s denied, the provider may not be reimbursed or the patient could face higher costs. Some payers use the term prior authorization or precertification, but the essential idea remains the same: getting approval ahead of the service. Post-authorization would be approval after the service, which doesn’t help plan and pay for the procedure in advance.