Pharmacy Prior Authorization System Implementation for a Managed Care Organization

The Challenge

A Fortune 500 managed care organization that manages publicly funded health programs was utilizing an outdated client-server system to manage the prior authorization process for medical and pharmacy prescriptions. While the system automated portions of the prior authorization process and helped to reduce administrative costs, it had the following significant issues:

• Reliability — The system experienced frequent downtimes which impacted operations and regulatory/compliance turnaround times.
• Scalability — The system’s platform was not scalable and therefore not able to handle growth and increase in case volumes.
• Flexibility — The system was not able to accommodate minor changes in a timely manner. For instance, clinical rules, which were used by the system and its users to process prior authorizations, took weeks to be updated. This postponed updates that would create cost reductions.
• Future outlook — The vendor that developed and supported the system was unstable as it was going through leadership changes and was in the process of being acquired by another organization.

In order to address these issues, the managed care organization selected a new system. However, they had many challenges and delays with implementing the new system. A year into the implementation project, the business process management software product had not been implemented in any of the organization’s markets and had only a limited set of the organization’s business rules configured and developed. The organization’s leadership began to doubt the value of the project due to its increasing costs and were concerned that anticipated ROI for the implementation could not be met. Cumberland was engaged to take over the management of the overall implementation and provide business analysis support. The system was to be implemented for a pilot market within six months and was expected to be implemented throughout the organization’s entire Medicaid and Medicare lines of business within 15 months.

Cumberland’s Approach

Cumberland led an objective assessment of the current implementation in order to determine the challenges that were impacting its progress and causing increases in cost.

The assessment revealed the following factors:

• Communication regarding the status of the project, critical risks and issues were not being provided to project owners, stakeholders and key decision makers on a regular and timely basis.
• Key decision makers and subject matter experts were not involved in critical requirements and design sessions.
• The project’s focus and objectives were evolving on a regular basis. However, the impact of these changes on existing objectives was not being assessed and communicated to leadership.
• The scope of the project was continually evolving and increasing and a process to help manage the changes and assess their impact did not exist.
• The technical and operational teams impacted by the implementation were working toward different milestones and goals.

Based on the assessment, recommendations for addressing each of these issues were defined and provided to the organization. The organization’s executive team made a decision to move forward with Cumberland’s recommendations within the timeline and budget available for the project.

The following recommendations were implemented:

• Establish a project charter, project governance and overall project management plan for the implementation
• Implement the management and monitoring of project issues, risks, budget and milestones
• Define the current state process that the system is intended to enable and automate based on the technology available and the organization’s immediate objectives
• Manage the development effort to build a web application that automates the majority of the Medical and Pharmacy Prior Authorization Process
• Pilot the solution before implementing it across the entire organization
• Update the system based on feedback gathered from the pilot
• Implement the solution across the entire organization

Results

In the implementation phase of the project, Cumberland managed the development and testing of the system and conducted successful implementations across all of the organization’s Medicaid and Medicare markets. The system enabled the organization to reduce operational costs, reduce compliance and regulatory issues/fines, improve reporting and data analysis capabilities, and better manage pharmacy costs. The solution is an integrated workflow system that clinically automates nearly the entire pharmacy prior authorization process. The system enables users to quickly configure/update complex clinical rules, reduce turnaround times for gathering the information needed to process cases and integrate real-time eligibility, benefits, and formulary data with medical and pharmacy claims data. Providers are now able to submit Prior Authorizations to the organization via the web.

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