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  • Writer's pictureMuhammad Sair Khan

Prior authorization for addiction treatment facilities


Prior authorization is a requirement for medical providers to obtain approval from insurers before performing a specific health care service. Without prior authorization, the health insurer may not pay the medical claim, leaving you with few options to get paid.

Prior authorization was put into effect as a way for insurers to control costs and ensure that patients are receiving effective treatment. It is almost always necessary for mental health and addiction treatment services.


Typically, before a patient admits into your residential or outpatient treatment facility, a Utilization Review (UR) specialist on your team should call the patient’s insurance company to request an authorization for treatment. Your UR specialist should discuss the patient’s medical history and current condition with the case manager. Together, they will determine an appropriate level of care and approximate length of time that your patient should be seen. Following the call, you should receive an authorization number that you will use to bill insurance claims.

This helps eliminate confusion about what treatment the insurance company will allow and later, pay for.


If your UR specialist is not able to get an authorization before a patient starts treatment, they will need to request a retroactive authorization. Because insurance companies are not legally obligated to pay claims that don’t follow their guidelines, missing the prior authorization window may cause you problems with payment once you submit the insurance claim. In this case, you will most likely need to submit an appeal letter.

Click here to learn more about appeal letters


1. Keep Facility Licenses and Accreditations Accessible

Payors want to ensure you have the proper license and accreditations before they authorize treatment. This is especially true if you are a new facility and it’s your first time calling a particular payor. The quicker you get them the information, the sooner you will get paid.

2. Review The Client’s Chart

It’s important to understand the client's medical history before you contact the case manager. You should know the severity of the patient's symptoms, his/her mental status, current medications, previous family therapy notes, etc. The more you know, the more treatment you will get authorized. ASAM guidelines are also a great tool to use when calling for authorization.

3. Check for Typos

It is critical that all of the information you receive concerning the patient and the facility are input correctly. One small typo can cause huge problems down the road. File any papers you receive from the insurer in case you need to reference them later.

4. Call In The Case ASAP


f you miss the deadline, you are at risk for not getting paid for treatment that you provided.

5. Take Notes

Document everything. Note the date and time each time you call or talk to an insurance representative. Get the name of the case manager and the services and codes that they approve. Don’t forget the authorization number.

At Datapro, we have an experienced Utilization Review team who specializes in behavioral health and substance abuse. Contact us today for information on our process and how we can help improve your patient experience.

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