What best describes prior authorization?

• A. Restrictions on the use of a medication placed on the drug by the payer or insurance company to determine if they should or should not pay for the claim
• B. The process to automatically approve all prescriptions
• C. A listing of alternative drugs
• D. A cap on monthly copay

Answer: (A)

Prior authorization is a process used by payers to require clinical justification before they will cover a prescription. The prescriber or pharmacy must provide information showing why the drug is medically necessary for the patient. The insurer then decides whether to approve the claim, deny it, or suggest an alternative treatment. This can delay dispensing until approval is obtained. It is not automatic approval for all prescriptions, not simply a listing of alternative drugs, and not a cap on copays.