In health plan utilization management, what is preauthorization?

• A. Approval before certain services are delivered.
• B. Preauthorization is the process of obtaining approvals after services are delivered.
• C. Preauthorization applies only to emergency care.
• D. Preauthorization determines eligibility for retirement contributions.

Answer: (A)

Preauthorization is the process of getting approval from a health plan before a specific service is provided to confirm that it will be covered and considered medically necessary. This step is part of utilization management, helping ensure that planned care is appropriate and aligns with the member’s benefits, so clinicians and patients know what will be covered ahead of time. For example, many plans require preauthorization for procedures, certain imaging tests, or expensive therapies. If the plan approves, the service is typically covered (assuming other plan rules are met); if not, the service may not be covered or may require an alternative, cost-sharing arrangement. This concept is different from approvals after care is delivered, which is retrospective authorization; it’s not limited to emergencies, since many non-urgent procedures also require preauthorization; and it has nothing to do with retirement contributions or eligibility.