Which term describes authorization or approval for payment from a third-party payer requested in advance of a specific procedure?

Which term describes authorization or approval for payment from a third-party payer requested in advance of a specific procedure?

• A. Pre-certification
• B. Pre-authorization
• C. Deductible
• D. Pre-approval

Answer: (B)

Pre-authorization is the process of obtaining insurer approval to pay for a procedure before it is performed. This ensures the third-party payer has reviewed the medical necessity and agrees to cover the service under the patient’s plan, preventing unexpected out-of-pocket costs and confirming coverage in advance. A deductible is just the amount the patient must pay before the insurer contributes, not an approval process. Pre-certification is a similar concept used by some plans, focusing on documenting medical necessity for certain services, while pre-approval is sometimes used interchangeably but isn’t as specific to the pre-service payment determination. In this context, the term that describes authorization for payment requested in advance is pre-authorization.

Pre-authorization is the process of obtaining insurer approval to pay for a procedure before it is performed. This ensures the third-party payer has reviewed the medical necessity and agrees to cover the service under the patient’s plan, preventing unexpected out-of-pocket costs and confirming coverage in advance. A deductible is just the amount the patient must pay before the insurer contributes, not an approval process. Pre-certification is a similar concept used by some plans, focusing on documenting medical necessity for certain services, while pre-approval is sometimes used interchangeably but isn’t as specific to the pre-service payment determination. In this context, the term that describes authorization for payment requested in advance is pre-authorization.