What is preauthorization or precertification approval?

Preauthorization, or precertification approval, is a process used by health insurance companies to determine whether a specific medical procedure, service, or medication is necessary and covered under a patient's policy before it is performed or prescribed. This approval is typically required for certain high-cost services, ensuring that the treatment aligns with the insurer's guidelines for medical necessity. Obtaining preauthorization can help avoid unexpected medical bills and ensure that the patient receives the appropriate care as deemed necessary by their healthcare provider.