Get the facts: Why is prior authorization needed?

Open a newspaper, turn on the nightly news, or scroll through your social feed, and you’re likely to come across conversations about the challenges facing our health care system. These conversations are important, but they’ve also revealed there’s a lot of confusion about health care, and for good reason – it’s very complex.

In this series of articles, we’re setting out to debunk some of the most common myths and misconceptions about health care and health insurance. Our goal is to clear up the confusion and provide the facts about how the health care system works so we can identify solutions to make it better.

What is prior authorization?

Prior authorization is an important checkpoint that helps minimize the chances you’ll receive an unexpected medical bill, but it’s not required for most types of care.

Why is prior authorization used?

Checkpoints exist throughout the American health care system. They ensure people receive appropriate care and avoid preventable errors in treatment or diagnoses. While doctors and hospitals manage most of these checkpoints, health insurers also play a role. The most familiar example is prior authorization, a process through which health plans verify that health care services are covered by the member’s health plan and meet the standards for quality and safety before the member undergoes a procedure or surgery. This also makes it an important tool to ensure bills don’t come as a surprise to patients.

Prior authorization is one of the few tools available to help prevent losses from wasteful overtreatment and low-value care, which are far too common in our health care system, resulting in $76 billion to $101 billion in unnecessary costs every year.¹

How often is prior authorization used?

For all the recent noise around prior authorization, the reality is it’s rarely used.

When our members seek care, prior authorization is not needed 98% of the time.²
Only 26% of the provider groups we work with submitted more than one prior authorization request of any kind per year over the last two years.
For the 2% of our members' medical claims that required prior authorization, 91.7% were approved.
Very few of our members (less than 2%) are impacted by denied prior authorization requests.

When is prior authorization used in the insurance process?

UnitedHealthcare most frequently uses prior authorization in the following scenarios:

A diagnosis presents multiple treatment options that vary in quality, outcomes and cost: For example, many procedures that used to require inpatient stays in hospitals can now take place in outpatient facilities where operating costs are lower, quality outcomes are as good or better than at inpatient facilities, stays are shorter, and risks of hospital-acquired infections are reduced. In addition, some conditions that can be treated with surgery may also be effectively treated with physical therapy, potentially saving the patient hundreds of dollars in out-of-pocket costs. In these cases, UnitedHealthcare relies on the latest clinical literature and evidence-based recommendations. The process is open and transparent, with all of our guidelines posted online and available to the public. Over time, when clinical guidelines become the standard of care for certain services and treatments, and variation in care is reduced, prior authorization may no longer be needed to ensure patient safety, quality and affordability.
Generally accepted care guidelines have evolved: This scenario could occur when new treatment guidelines for chronic conditions are released, when the FDA approves the use of existing drugs to address new conditions, or when updated recommendations on the appropriate use of imaging, such as X-rays and CT scans, are issued. In these situations, UnitedHealthcare focuses on helping providers understand what’s changed and the additional information they may need to submit when they order an imaging test, for example. This additional support for providers typically leads to higher prior authorization approval rates and a decrease in appeal rates.
A procedure or medication comes with a high price tag and could lead to high out-of-pocket costs for the member: The purpose of prior authorization in this scenario is to ensure the member is receiving the safest and most appropriate treatment or service, according to widely accepted clinical guidelines, and that everyone is clear on what’s covered before treatment begins.

What is UnitedHealthcare doing to make the prior authorization process better for patients and providers?

The vast majority of our members don’t receive care that requires prior authorization, and for those that do, we approve nine out of 10 prior authorization requests. But regardless, we know prior authorizations are frustrating for patients and providers and can feel like an unnecessary complication in their care journey. That’s why we’re committed to making the process faster, simpler and more transparent.

As part of an industry-wide effort, we signed on to six commitments to streamline, standardize and modernize the process, including reducing the number of services subject to prior authorization, accelerating response times, improving transparency and expanding real-time, electronic processes.
We’re focused on responsible use of prior authorization, as shown by our performance in CMS’s most recent program audit of our utilization management practices in September 2024. CMS found no areas in need of corrective actions.³
In 2023, we took the significant step of eliminating the requirements for nearly 20% of our prior authorization volume, particularly in cases where there was minimal variation in care across the more than 7,000 hospitals in our network.
We continued that effort in 2024 by removing prior authorization requirements representing nearly 10% of our total prior authorization volume.
Since 2016, we’ve reduced the number of services subject to prior authorization for our Medicare Advantage members by 40%.
We will continue to regularly evaluate codes requiring prior authorization to identify instances where it is no longer needed to promote patient safety, quality and affordability.
We introduced a first-of-its-kind national Gold Card Program in 2024, which recognizes provider groups who consistently follow evidence-based care guidelines by exempting them from prior authorization requirements for many procedures. In 2026, we’ve seen a more than 40% increase in the number of provider groups that have qualified for the program. In a survey of the provider groups most active in the program, 94% reported being satisfied with it, and that same percentage agreed that the program has reduced administrative tasks.
As part of our efforts to simplify and streamline the consumer and provider experience, we are increasing the use of electronic submission of prior authorization requests, which enables a much faster response to the provider. As a result of this transition to electronic processing of prior authorization requests, we now approve nearly half of all requests in real-time, and almost all decisions are made within 24 hours.

Together, these efforts reflect our commitment to improving the experience for physicians and patients, while supporting safe, appropriate and affordable care. As these initiatives progress, patients and providers alike can expect an even smoother, more efficient and more transparent experience that brings the focus where it belongs: delivering the high-quality care patients deserve.

Learn more about the UnitedHealthcare Gold Card Program.